As a commendable first step towards ensuring better transparency, Rep. John Tierney (D-MA), with bipartisan support from Members of Congress, POGO, and other organizations, sent a letter on May 11 to OMB Director Peter Orszag urging him to require reporting from contractors and subcontractors who receive stimulus funds that are funneled through states and localities. Currently, the reporting guidelines for sub-awards are seriously inadequate, with no reporting required below local governments or organizations, ripening these funds for fraud and abuse.
As the system currently stands, a federal agency, say the Department of Education, would give a grant to Pennsylvania to be distributed through its education system. Pennsylvania would then disperse those funds to say, 14 different school districts. Part of that dispersal would then include hiring 20-30 contractors to complete the work needed, such as building a new roof. However, those contractors would not be required to report how the money was spent to build the roofs; only the school district would be required to report the hiring of the contractor (without naming specifically who it was) to Pennsylvania, who would then report back to the Department of Education. For all intents and purposes, there is no actual reporting at the ground level.
Earl Devaney, chair of the Recovery Accountability and Transparency Board, stated in a May 5 hearing titled "Follow the Money Part II: Government and Public Resources for Recovery Act Oversight" that he would like to be able to track stimulus spending on the ground level: "If I could wave a magic wand, I would want to follow a dollar from cradle to grave." And POGO, along with 37 other groups in the Coalition for an Accountable Recovery (CAR), sent a number of suggestions and comments to OMB for improving stimulus oversight, including that “all recipients and sub-recipients, regardless of how many layers removed from the initial federal disbursal should be required to report to the system for any Recovery Act money over $25,000.”
Of course, such an unprecedented level of reporting requirements has been a huge cause of concern for states whose offices simply lack both the manpower and financial ability to fulfill their duties. In an effort to assist these states, the White House released a memo on Wednesday announcing that the federal government will provide funding to states to cover the costs of hiring auditors and accountants to keep track of stimulus spending. OMB Director Peter Orszag added that instead of the usual reimbursement for these costs after the fact, funds will be provided pre-spending, a huge relief to these struggling states.
We applaud the recent memo by the White House ensuring states have the resources to fulfill their oversight duties, and we hope it will contribute to a groundbreaking new level of openness and transparency in government spending.
-- Gracie Bowden
no matter what corruption you uncover it will not matter because the voters and major main stream media don't care.
Posted by: d duck | May 16, 2009 at 11:18 AM