The federal government’s Recovery Board has a lesson for every federal agency that distributes taxpayer money – stay transparent and make sure that recipients do, too.
The Recovery Board, which oversees the $840 billion economic stimulus program and $276 billion in federal contracts, has figured out how to get compliance from companies and state and local government agencies that fail to file their required reporting showing where taxpayer money is going every three months.
It’s simple: Make their names public.
When the board first started publishing the names of delinquents on its “Wall of Shame” in September 2009, there were 4,359 recipients that failed to file. In the latest filing released last week, there were just 303 delinquents out of 140,000 spending reports for the first quarter of 2012.
In a recent blog post, the board explained its disclosure policy: “The board decided that if recipients would thumb their noses, then it made sense to point the figure at them. We established a quarterly posting of non-compliers on Recovery.gov.”
And it’s shown there is no free federal handout.
“Clearly, the ‘Wall of Shame’ has been an effective oversight tool,” said board spokesman Edward Pound. “It’s pretty clear it has brought broad compliance. There are very few recipients now not reporting.”
Pound said a major component of the oversight effort is to make sure recipients comply with the law and report quarterly to taxpayers on how they have used Recovery funds.
The non-partisan OMB Watch gives the board high marks for its disclosure policies and for tracking spending on the 2009 economic stimulus package.
“The board can be seen as a model of how to get things done,” Craig Jennings, OMB Watch director of federal fiscal policy, told Breaking Gov.
“The goal would be for every agency to do this,” Jennings said.
Washington good government group POGO (Project on Government Oversight) said the public shaming has had remarkable results.
“We think it should be replicated for all federal spending. There’s been a low incidence of fraud and a lot of attention paid to transparency which has led to more accountability,” Angela Canterbury, director of POGO’s public policy, told Breaking Gov.
The board has credited its system of requiring public reporting from funding recipients — and calling out those who don’t comply — with contributing to the less than 1 percent rate of fraud in the stimulus spending program. And the Recovery Board has become the road map for government transparency for the future.
In 2010, President Obama turned up the heat on non-compliant recipients, issuing a get-tough directive to agencies that distribute Recovery funds. Agencies were directed to terminate awards and initiate suspension and debarment procedures against violators.
Legislation now moving through Congress – the Digital Accountability and Government Transparency Act or DATA Act – takes the Recovery Board’s work a step further.
It would require agencies and federal grant and contract recipients to file receipts and detailed reports on spending to an independent commission. The reports would be posted on a public website similar to Recovery.gov.
And they can take a few lessons from the board. For example, nearly half – 139 – of those who failed to file reports during the first quarter of 2012 were cities, counties, police departments, sheriff’s offices and others who received grants from the Department of Justice, according to Michael Wood, the board’s executive director.
Some recipients said they did not have the personnel available to fill out reports and submit them. Others experienced technical difficulties, and some simply said their failure was unintentional, Wood wrote in a recent blog post.
Here’s a glimpse from Wood’s blog of some recipients that failed to report how they used stimulus money in the latest report:
· Northrop Grumman Systems Corp. failed to submit a report on a $3.1 million contract issued by the Social Security Administration. The SSA said that “the individual [in Northrop Grumman] responsible for reporting on behalf of the recipient indicated he forgot the due date for the report.”
· The office of the Arizona Attorney General did not submit a report on a $2.9 million grant from the Justice Department. The recipient said its failure was unintentional.
· The Milwaukee County Transit System said it forgot to submit a report on its use of a $26 million grant, according to the Federal Transit Administration, which plans to suspend the grant payments if the transit system fails to file a report in the next quarter.