FINDINGS AND RECOMMENDATIONS
I. PROGRESS TOWARDS GOAL OF 100,000 NEW POLICE OFFICERS
The first objective of our audit was to assess COPS' progress in achieving its stated goal. We found that COPS has not been consistent with respect to when the 100,000 additional officers funded by the Crime Act will be "on the street." During the course of this audit, COPS officials informed us that their goal is to fund i.e., to have approved grant applications for 100,000 new officers by the end of FY 2000. COPS disclaimed a goal of having the 100,000 new officers hired and actually deployed to the streets by the end of FY 2000, even though this goal has been stated by COPS Office publications and Department reports, and in speeches by Administration officials as shown below.
These statements have the tendency to confuse the public as to what to expect from the Crime Act and when it will be delivered. Moreover, some claims of achievement in the COPS program have been inaccurate and could mislead the public into believing more progress had been made than was supportable.
Clearly, the COPS grants will not result in 100,000 additional officers on the streets by the end of FY 2000. Based on projections by the COPS Office, only 59,765 of the additional officers will be deployed by the end of FY 2000.
We are also not certain that the COPS Office will be able to "fund" 100,000 officers by the end of FY 2000, as that term is commonly understood. COPS counts an officer as funded when it approves the grantees' application for award of the grant, instead of when the grantee actually accepts the grant. While COPS projects in its FY 2000 budget that it will fund 107,019 additional officers by that time, our audit findings raise serious questions about whether several thousands of these "funded" officers that are currently counted toward COPS' goal will in fact be hired by the end of FY 2000. As is explained further in the text on the following pages, we reached these conclusions because:
According to COPS' records, as of February 11, 1999, COPS and OJP had awarded about $5 billion in grants for hiring or redeploying approximately 92,300 officers. Any significant problems COPS encounters in awarding or maintaining the grants could keep COPS from not only funding 100,000 officers by the end of FY 2000, but also putting the officers on the street by the end of FY 2000. As detailed below, COPS' records may overstate the number of funded officer positions that will be hired or redeployed, and many of the positions that have been funded may not be retained through FY 2000.
Unaccepted Grants. COPS counts officers toward the funding goal when it accepts a grantee's application and decides to award the grant, even though: (1) the award document has not been mailed to the grantees, and (2) the grantee is given 45 days to accept the grant after the grant is mailed.8 As of February 11, 1999, COPS' records indicated that 2,851 grants had not been accepted by agencies, even though they had been counted towards the goal to add 100,000 officers to the streets. These grants account for approximately $668.9 million and 13,196 officers funded. Of these 2,851 grants:
In our judgment, COPS should not count officers towards the goal until the grantee agencies formally accept the grants and commit to hiring the officers. While COPS does not agree with our recommendation, COPS officials have begun making several procedural changes to identify unaccepted grants and to ensure the grants are either accepted more promptly, or the funds associated with the grant are deobligated more promptly when grantees do not accept the grants.10 COPS plans to change the acceptance period from 45 days to 90 days, because, according to COPS, historical data shows the grantees need more than 45 days. COPS also plans to mail the grantees a reminder 30 days before the acceptance period expires to remind the grantees of the acceptance award policy. When the 90-day acceptance period expires, COPS plans to send the grantees a "last chance" letter to determine if the grantee will accept the grant. If the grantee still does not mail back the signed award document, COPS has said it will withdraw the grant and deobligate the funds.
Redeployment Under MORE Grants. We found that most of the grantees that we individually audited or that we reviewed during this audit could not demonstrate they had or would redeploy officers from administrative duties to the streets. MORE grants fund technologies, equipment, civilian employees, and overtime to redeploy officers from administrative work to the streets. COPS requires grantees to track the redeployment of officers into community policing. According to COPS, as of February 11, 1999, it had awarded approximately $967 million to redeploy approximately 35,850 officers under the MORE program. Thus, over one-third of COPS police officer deployment achievements depends on the success or failure of the MORE grants.
Our audits of grantees from October 1996 through September 1998 found that 52 (78 percent) of 67 grantees receiving MORE grants either did not have a system to track the redeployment of officers into community policing or, if they had such a system, it could not show adequate officer redeployment. Moreover, during our audit of the COPS program, a random sample of 38 MORE grantees found that none had developed a plan to track redeployment. COPS has done its own review that substantiates the existence of this problem. According to COPS, it reviewed 18 MORE grantees in 1997 and found the grantees had redeployed 63 percent of the officers funded. These grantees expected to redeploy another 14 percent of the officers funded, bringing the total expected redeployment to 77 percent, short of its goal by almost one-quarter.
Retention of Officer Positions After Grants Expire. Grantees may fail to retain as many as 31,091 officer positions through FY 2000. COPS and OJP started awarding the community policing grants in FY 1994. Most grants provide funding for three years. As such, grants awarded in the earlier years of the program have started to end and many more grants will end each year. Accordingly, if COPS is to reach 100,000 officers on the street by the end of FY 2000, the grantees will have to retain the positions for up to three years after federal funding ends. However, many grantees may not retain the positions for two reasons. First, according to COPS, the grants awarded under the PHS and Phase I programs did not require the grantees to retain the funded officers. Since the grantees are not required to retain these positions, many of the 4,573 officer positions funded by these grants may not be retained through FY 2000. Second, in August 1998, COPS established a retention policy for the remaining four grant programs that would require grantees to retain the officer positions for a minimum of one local budget cycle after the local budget cycle in which the grants expire. COPS obtained approval for the policy from the Attorney General. This policy will further reduce the likelihood that COPS will have 100,000 new officers on the street by the end of FY 2000. According to records provided by COPS during our audit, accepted grants under the remaining four programs involving approximately 41,800 officers were expected to end before the end of FY 1999. If these grantees retain these officer positions, or maintain the funded redeployment levels, for only the minimum required time, at least 26,518 officers would not be on the streets at the end of FY 2000.
To determine if grantees were likely to retain grant funded positions, we asked a sample of grantees if they planned to retain the officer positions and if they had developed a good-faith plan to retain the positions. We randomly selected 200 grants and surveyed the grantees about their retention plans. One hundred ninety-one grantees responded to our retention questions. While 183 (96 percent) of the 191 grantees stated they would retain the positions, 79 (43 percent) of the 183 grantees said they had not developed a good-faith plan to retain the positions. These results are similar to the results of our individual audits of COPS grantees from October 1996 through September 1998. For the 144 audits in which we tested retention, 13 grantees (9 percent) indicated they would not retain the positions. Of the remaining 131 grantees, 70 (53 percent) had not developed a good-faith plan to retain the positions. These results indicate that a significant percentage of grantees either do not plan to retain the grant funded officer positions, or have not made preparations to retain them.
Terminated Grants. Grantees had terminated some or all
of their grants and additional grants may be terminated throughout the remainder of the
program. According to records provided by COPS during our audit, 500 grants that had been
obligated were terminated because, among other reasons, the grantees could not retain the
officers, could not provide the local matching funds, or no longer needed the additional
officers. These grants totaled approximately $79.7 million in obligations for about 1,300
officers. As shown in the following tables, our detailed analyses of these 500 grants
found that: (1) some of the grants and associated officers were still being counted
towards the 100,000 goal, and (2) the funds associated with many of the grants were either
not deobligated or were not deobligated promptly.
STATUS OF TERMINATED GRANTS
|Status In COPS' Automated System||Number of Grants||Number of Officers||Amount Awarded||Counted Towards Goal|
DEOBLIGATION OF TERMINATED GRANTS
WITH "ACCEPTED" STATUS
|Number of Grants||Amount Not Deobligated||Average Days From Withdrawal To Deobligation||Average Days From Withdrawal To Date of Review|
DEOBLIGATION OF TERMINATED GRANTS
WITH "WITHDREW" STATUS
|Number of Grants||Amount Not Deobligated||Average Days From Withdrawal To Deobligation||Average Days From Withdrawal To Date of Review|
Hence, we found average delays ranging from six months to over one year before COPS corrected its record keeping and funding obligations regarding grants that had been terminated by the grantees. Unless terminated grants are deobligated promptly, unexpended appropriations will be incorrectly reported to Congress. As previously stated, COPS plans to award grants for 107,019 officers through FY 2000. If COPS does not: (1) change the status in its database from "ACCEPTED" to "WITHDREW" for withdrawn grants, and (2) promptly deobligate the funds associated with the withdrawn grants, it will appear that COPS is further towards meeting the 100,000 goal than in fact is the case.
Supplanting of Local Funds. Some grantees appeared to be using federal grant dollars to fund existing police operations, instead of using grant funds to increase officers on the streets. This practice is called supplanting and is expressly prohibited. For the 147 local audits in which we tested for supplanting, we found indications that 60 grantees (41 percent) may have used federal funds to supplant local funds. For example, we found: (1) budgets for local positions were decreased after grantees received COPS grants, (2) COPS funds paid for local officers already on board, (3) local vacancies were left unfilled too long, and (4) requirements for matching contributions by grantees were not met.13 When grantees use grant funds to supplant local funds, additional officers are not added to the nation's streets.
We recommend the Director of COPS:
II. CONTROLS OVER MONITORING OF GRANTEES
COPS and OJP need to improve monitoring of grantees to ensure that grantees: (1) submit grant progress reports to COPS as required, (2) submit timely financial reports to OJP, and (3) correct problems identified during COPS' and OJP's site visits.
Federal grant management entails both program management and financial management. For all COPS grants, these two responsibilities are split between the COPS Office, which is responsible for program management, and OJP, which is responsible for financial management.
The Public Safety Partnership and Community Policing Act of 1994 and other federal regulations require that recipients of federal financial assistance be monitored to ensure that funds are used properly. To this end, COPS and OJP each require grantees to complete and file periodic progress reports. COPS requires grantees to file a Department Initial Report, annual Officer Progress Reports, a MORE Progress Report, and a Department Annual Report. Additionally, OJP requires grantees to submit quarterly Financial Status Reports (FSRs) detailing information on grant obligations and expenditures. The monitoring reports are important to help COPS and OJP monitor the grantees' compliance with grant conditions. For example, the Department Initial Report identifies the number of officers authorized by the grantee for the FY prior to the beginning of any COPS grants. The subsequent Department Annual Reports show whether the grantees decreased the number of locally funded positions after receiving the COPS grants. By reviewing these reports, COPS can identify potential supplanting issues needing further investigation. The FSRs are essential for OJP to monitor key grant conditions, especially the condition that grantees reduce the federal share percentage claimed each year of the grant. This grant condition exists so grantees will absorb more of the costs each year, preparing them to fund retention of the officers after the grants expire.
According to COPS, all grants are monitored to some degree. Approaches to monitoring grants include: (1) site visits conducted by COPS and OJP, (2) financial reviews conducted by OJP, and (3) grant audits conducted by the OIG.
Program Management By COPS
COPS Progress Reports. We determined that many grantees did not submit the
required monitoring reports to COPS. We reviewed the grant files and COPS' automated
tracking system for 200 randomly selected grants.14
Of the 200 grants, 159 were hiring grants under PHASE I, AHEAD, FAST, and UHP; 3 were
hiring grants under PHS; and 38 were redeployment grants under MORE. Our review showed the
following progress reports were not submitted to COPS or OJP at the time of our review.15
PROGRESS REPORT ANALYSIS
|ANNUAL DEPARTMENT||159||62||39 %|
|OFFICER PROGRESS||159||64||40 %|
|MORE PROGRESS||38||16||42 %|
|PHS PROGRESS||3||0||0 %|
The progress reports are critical for COPS to monitor key grant conditions such as supplanting and retention. Given the significant number of grantees that had not submitted the required reports, COPS needs to increase its monitoring efforts to ensure the reports are submitted.
COPS Site Reviews. While COPS had increased its efforts to monitor grantees by creating a Grant Monitoring Division which conducts site visit reviews, we found the reviews: (1) did not consistently cover all grant conditions and (2) were not adequately followed by action to ensure identified deficiencies were corrected. During our audit, COPS provided us a list of all 163 site reviews that it had completed of COPS grantees. We randomly selected 31 of the reviews to evaluate the thoroughness of the reviews and the adequacy of the follow up on identified deficiencies. We found that the reviews were usually conducted in one or two days, and primarily concentrated on community policing activities. Other critical grant conditions--such as supplanting, retention, allowability of costs, and matching funds--were often either not reviewed or not discussed in the site review reports that we reviewed. Moreover, we found little documentation that COPS followed up on the identified deficiencies in the reports to ensure that grantees took corrective actions. According to a COPS official, for reviews subsequent to the 163 reviews provided us during the audit, COPS developed new site visit procedures that include the: (1) systematic review of grants to determine compliance with critical grant requirements including non-supplanting, retention, program and financial reporting, grant expenditures, redeployment tracking under MORE grants, and community policing implementation; (2) preparation of site visit reports covering all the areas above; (3) referral of deficiencies found during the site visits to the appropriate COPS division offices for ensuring corrective actions; and (4) development of a standardized database to track the identified deficiencies until corrective action is completed. A COPS official also stated that a Financial Officer has been hired to improve the financial controls over the grants.
Financial Management By OJP
OJP Financial Status Reports. We determined that many grantees either did not submit the required financial reports to OJP or submitted them late. We reviewed the grant files and a printout from OJP's financial tracking system for 200 randomly selected grants.16 For the 200 grants, 2,074 quarterly financial reports should have been submitted to OJP from the beginning of the grants through the quarter ended December 31, 1997. However, the grantees had not submitted 649 (31 percent) of the required reports. Moreover, the grantees submitted 493 (35 percent) of the remaining 1,425 reports late. Due to the significant number of missing reports, we could not determine if the grantees were meeting the grant condition to reduce the federal share of grant funds claimed each year. Accordingly, OJP needs to increase its monitoring efforts to ensure the reports are submitted on time. An OJP official stated that its policy is to withhold payment to grantees if the grantee is delinquent in submitting financial reports at the time of the payment request. Once the grantee has filed the required financial report, payment is released. For the 200 randomly selected grants that we reviewed during this audit, we found no indication that OJP paid grantees when the grantees were delinquent in submitting the financial reports.
OJP Site Reviews. OJP also made site visits to monitor the financial activities of COPS grantees, but the site reviews were not adequately followed by action to correct identified deficiencies. During our audit, OJP provided us a list of all 101 site reviews that it had completed of COPS grantees. We randomly selected 13 of the reviews to evaluate the thoroughness of the reviews and the adequacy of the follow up on identified deficiencies. Like COPS, OJP usually conducted the reviews in one or two days. OJP consistently evaluated the adequacy of cash management, audit compliance, accounting system operation, procurement practices, and financial status reporting. However, also like COPS, we found little documentation that OJP pursued identified deficiencies to ensure grantees took corrective actions.
We recommend the Director of COPS:
We recommend the Assistant Attorney General, OJP:
III. GUIDANCE TO GRANTEES
From October 1996 through September 1998, we performed 149 individual audits of police hiring and/or redeployment grants awarded by COPS/OJP. Our findings suggest that, in addition to better monitoring by both COPS and OJP, COPS' guidance to grantees could be improved to ensure that critical grant requirements are understood and met. Specifically, COPS needs to better define its requirements for non-supplanting, allowable and unallowable costs, redeployment, officer retention, community policing, and progress reporting. COPS recognizes this weakness and has engaged a contractor to enhance its guidance to grantees in these critical areas.
COPS developed an "Owners Manual" for each type of COPS hiring and redeployment grant. The applicable manuals are: (1) provided to each grantee receiving a COPS grant, (2) posted on COPS' internet site, and (3) contain guidance for the grantees to follow to meet the terms and conditions of their grants. While the manuals contained the basic requirements applicable to the grants, the manuals usually did not provide adequate details or examples on how to implement the requirements. Our audits of individual grantees showed that many grantees experienced problems implementing the same grant conditions, an indication that grantees could benefit from better guidance.
From October 1996 through September 1998, we conducted 149 audits of grantees awarded police hiring and/or redeployment grants from COPS/OJP. These audits covered grants totaling $511 million, or 10 percent of the funds COPS has obligated for hiring and redeployment grants for the program. Appendix III to this report is a matrix summarizing our audit findings by type and by grantee. We grouped findings together by subject area and grouped auditees together by size and type. All findings were not of the same magnitude; therefore, we coded each finding to show whether it was serious, moderate, or minor. Our audits identified approximately $52 million in questioned costs and approximately $71 million in funds that could be better used.17 Our dollar-related findings amount to 24 percent of the total funds awarded to the 149 grantees.
In considering our audit results, it should be kept in mind that they:
Notwithstanding the above, our findings indicate that significant numbers of jurisdictions that we audited are not meeting critical grant requirements. The lack of clear guidance from COPS/OJP may be a contributing factor. The following weaknesses appear to cut across all types of grantees regardless of size or location.20
In August 1998, we met with COPS and informed them of the areas where we believed they should strengthen guidance to grantees in light of our findings. Subsequent to our meeting, COPS contracted with KPMG Peat Marwick LLP, Certified Public Accountants, to provide better guidance to grantees. On November 18, 1998, COPS provided us a draft of KPMG's report. The draft report contained strengthened guidance, including examples of situations grantees might encounter in each of the areas where grantees had common problems. Specifically, the draft report included increased guidance on: (1) community policing, (2) redeployment, (3) retention, (4) allowable costs, (5) matching funds, (6) non-supplanting, (7) training, and (8) reporting.
We recommend the Director of COPS:
STATEMENT ON MANAGEMENT CONTROLS
In planning and performing our audit of COPS' and OJP's management and administration of the COPS program, we considered both organizations' management controls for the purpose of determining our auditing procedures. This evaluation was not made for the purpose of providing assurance on the organizations' management controls as a whole. However, we noted certain matters that we consider to be reportable conditions under Government Auditing Standards.
Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the management controls that, in our judgment, could adversely affect COPS' and OJP's ability to effectively manage the COPS program. As discussed in the Findings and Recommendations section of this report, we identified weaknesses in the following areas: (1) acceptance of grants, (2) redeployment under MORE grants, (3) retention of positions after grants expire, (4) termination of grants, (5) supplanting local funds with grants funds, (6) submission of program monitoring reports, (7) follow up on deficiencies identified during COPS site visits, (8) submission of financial monitoring reports, and (9) follow up on deficiencies identified during OJP site visits.
Because we are not expressing an opinion on COPS' or OJP's management controls as a whole, this statement is intended solely for the information and use of COPS and OJP in managing the COPS program. This restriction is not intended to limit the distribution of this report, which is a matter of public record.
STATEMENT ON COMPLIANCE WITH LAWS AND REGULATIONS
We have audited COPS' and OJP's management of the COPS program. The period covered by the audit was from program inception through February 11, 1999, and included a review of selected activities and transactions.
In connection with the audit and as required by the standards, we tested transactions and records to obtain reasonable assurance about COPS' and OJP's compliance with laws and regulations that, if not complied with, we believe could have a material effect on program operations. Compliance with laws and regulations applicable to the COPS program is the responsibility of COPS and OJP management.
An audit includes examining, on a test basis, evidence about laws and regulations. The specific laws and regulations for which we conducted tests are contained in:
Except for instances of non-compliance identified in the Findings and Recommendations section of this report, COPS and OJP complied with laws and regulations cited above. With respect to those transactions not tested, nothing came to our attention that caused us to believe that COPS and OJP management were not in compliance with referenced laws and regulations.
8 In addition to being a program weakness, this issue is a financial weakness that we identified in our FY 1997 Audit Report of Offices, Boards and Divisions Annual Financial Statement, Report No. 98-25. We also noted this issue continued to be a weakness during our audit of the Office, Boards and Divisions FY 1998 financial statements.
9 While presumably COPS could waive the 45-day period or allow the grantee to reapply, the considerable passage of time that we found appears to suggest indecision or abandonment on the grantee's part.
10 COPS is also comparing its records with OJP's to identify grant acceptances that were returned by the grantees to OJP instead of COPS.
11 This average was based on 342 of the 346 grants because the COPS database did not contain a withdrawal date for the other 4 grants.
12 This average was based on 83 of the 115 grants because the COPS database did not contain a withdrawal date for the other 32 grants.
13 While decreasing the budgets for local positions, using COPS funds to pay for officers already on board, and leaving local positions vacant for too long all result in fewer officers added to the streets, providing only part of the matching funds does not necessarily result in fewer officers added to the streets. Of the 60 grantees that had indications of supplanting, 5 provided only part of the matching funds.
14 In addition to reviewing program reporting for 200 grants during this audit, we routinely review grantees' compliance with the program reporting requirements during our individual audits of grantees. See Finding III for the results of our individual grant audits through September 1998.
15 These progress reports were required to be submitted to COPS, except for the PHS progress reports. Since OJP administered the PHS grants, the PHS progress reports were submitted to OJP instead of COPS.
16 In addition to reviewing financial reporting for 200 grants during this audit, we routinely review grantees' compliance with the financial reporting requirements during our individual audits of grantees. See Finding III for the results of our individual grant audits through September 1998.
17 Questioned costs are monies spent that at the time of our audit do not comply with legal requirements, or are unsupported, or are unnecessary or unreasonable. These costs can be recoverable or non-recoverable. "Funds to better use" are unspent monies that could be more efficiently used in the future if management acts on our findings.
18 Of the 149 audits we performed through September 30, 1998, 103 of the grantees were referred to us by COPS or OJP.
19 It should be noted that although we selected only 46 of the 149 audits summarized in this report ourselves, our results to date do not differ markedly from the results in the COPS/OJP referred audits.
20 We did not test each attribute for all grantees because several of our audits were either limited scope special requests, the grantee's records were not auditable, or the test was not applicable because of the type of grant being audited. Therefore, our universe of potential weaknesses was not always 149 audits.
21 The numbers in parentheses exceed 60 because several grantees had multiple findings relating to supplanting. Also, it should be noted that grantees that met part, but not all, of the matching requirements of the grant would not necessarily have supplanted local funds. Our results include five grantees in this category.
22 Because COPS grant criteria on retention has been vague (see footnote 6), we applied the following test for retention. We reviewed documentation, when available, and asked grantees what efforts they had made to retain the positions. If we concluded the grantee was not making a good-faith effort to retain the officer positions, we made a recommendation to develop a written retention plan although it was not always a formal grant requirement.