OIG Audit Report 07-05

In September 2005,the Office of Justice Programs completed a review of its grant closeout process.⁴² The goal of this review was to evaluate the closeout process it identified as “burdensome and problematic” in order to design a new streamlined closeout process that would bring standardization, efficiency and automation to OJP. In its analysis OJP identified the following areas of concern related to its grant closeout process:

Inconsistencies exist between OJP and DOJ Closeout Guidelines. According to OJP, the closeout process does not conform to DOJ closeout guidelines documented in 28 C.F.R. §66.50; OMB Circular A‑102; or OMB Circular A-110. OJP found that it was not in compliance with documentation and timeline requirements as set forth in these documents. OJP program offices were not consistently collecting required final reports and timeframes for closeout deadlines that were documented in OJP policies and procedures were not consistent. Also, communications to grantees were up to twice as long as the deadlines set forth by DOJ regulations.
Insufficient and inconsistent policies and procedures exist to govern the closeout process. OJP found that its program offices lacked a clear, concise, and accurate set of policies and procedures for the grant closeout process. OJP policies and procedures provided conflicting information regarding documentation, timeliness, and roles and responsibilities. Additionally, the OJP Financial Guide, Grant Manager’s Manual, and OJP Office of the Comptroller (OC) policy statement lack sufficient guidance for rules and regulations concerning administrative closeouts for uncooperative grantees.
Resources to support the process do not exist to ensure accuracy and completeness. OJP found that its staff did not have access to the correct tools and information needed to accurately complete the grant closeout process. Information regarding closeout procedures was provided to grantees, but was not easily accessible, nor was it presented at the correct point during the life of the award and was not easily understood. Additionally, grantees and grant managers alike were not consistently provided with data regarding end dates of awards and, similarly, the OC monitoring data was not appropriately disseminated within OJP program offices.
Lack of grantee and OJP program office coordination. OJP found that its program offices were only able to determine that a grantee completed the closeout requirements by directly contacting the grantee for information. There was no single, comprehensive source for a grantee's full programmatic and financial history. According to OJP, the reactive nature of this process, e.g., contacting grantees and requesting they provide missing documents, created difficulty for a variety of reasons, including: (1) grantees were not fully aware of closeout requirements and were thus, non-responsive to grant manager requests, (2) appropriate grantee contacts could be difficult to reach if the project has experienced turnover in key staff members, (3) communication deficiencies exist between programmatic and financial contacts for a particular grant, and (4) certain grantees abandon entire projects and cannot be located.
Handoffs between OJP program offices and the OC. OJP found that its program offices had no means to determine where a closeout was in the process once it had been submitted to the OC, which became an issue when a closeout package was rejected and returned to the grant manager. Additionally, closeout packages can be placed on hold by the OC with no communication to the program office. This became an issue when the program office reviews reports that track the number of closeouts performed and those that remained outstanding. Finally, program offices that manage large numbers of grants lack the appropriate tools to adequately track closeout packages that have been completed and submitted to the OC, which leads to multiple submissions for a single grant.
Lack of an audit trail. The lack of visibility also relates back to the issue of lack of audit trail information. Program offices, with the exception of the National Institute of Justice (NIJ), which uses the NIJ Pipeline System, do not have tools in place to track grant closeout packages. Program offices currently rely on the OC Systems Branch to provide reports with upcoming closeout dates and closeouts that are past due. The OC utilizes several tools for tracking closeout information. However, the information captured is differentiated and does not provide a complete picture of the closeout package status.
Non-standard business processes are the rule, rather than the exception. Each program office conducts the closeouts process differently and often have undefined and undocumented “workarounds” that have evolved over time. In addition, roles and responsibilities vary by program office.
Performance measures are not established or enforced to ensure timely completion of the closeout process. OJP does not currently track whether grant closeouts were completed correctly, the length of time it took to complete the full closeout process, or how many administrative closeouts were processed.
System tools are not in place to effectively support the process. A variety of systems are in place to track grant closeout data. However, these systems do not interact or interface with each other, do not cover all aspects of the grant closeout process, and collect disaggregate information that does not add value to the overall grant closeout process. In addition, the manual nature of the closeout process causes the following:

Issue	Implication
Manual process is too lengthy or involved for grant managers’ volume of closeouts	A combination of the lengthy and cumbersome current process, along with lack of prioritization of closeouts by management, results in closeouts not being completed within established timeframes.
No standard method of communication between the grantee and OJP program office, OJP program office and the OC, and the OC and grantee	Consistent language, timeframes, and requirements are not communicated to grantees across OJP program offices and the OC, and even across grant managers within a particular OJP program office. This results in inconsistent customer services and confusion for grantees who work with multiple OJP offices. Workload is increased in the OC by having to check for different forms, signatures, and notations on closeout packages from each of the different OJP program offices.
Inability to accommodate workforce changes (grant managers) in a timely manner	Grants are left unattended and unsupervised when a grant manager leaves and a new grant manager is not immediately assigned. This lapse in grant management has numerous implications for OJP and makes these grants especially difficult to close at the end of the grant because of the loss of familiarity with the grant and grant staff.
No dissemination of monitoring data in OJP program offices	Grant managers who do not have adequate access to the OC monitoring list will submit closeout packages to the OC where they will be placed on hold until monitoring issues are resolved and holds are released. OJP program offices are not always aware when a closeout package is placed on hold in the OC.
Inconsistent system and methods for completing closeout packages	Each OJP program office complies and processes closeout packages differently. This non-standard approach does not facilitate a shared knowledge base for closeout across OJP, results in inconsistencies for grantees who work with multiple OJP program offices, and creates additional work for the OC during review of closeout packages.

Upon completing its review, OJP identified the following areas and recommendation for improvement. Specifically:

Revise policies and procedures for the OJP-wide manual grant closeout process. Communicate to, and train all relevant OJP staff on the new policies and procedures.
Develop new OJP closeout forms to facilitate the manual process.
A streamlined and standard OJP-wide grant closeout process should be adopted.
Grantees should be held accountable for timely and consistent completion of closeout requirements.
Grantees and OJP staff should have better access to closeout information.
The new closeout process should be flexible enough to meet OJP’s needs.
Formal, OJP‑wide policies and procedures should be established to support the automated closeout process.
The OJP Office of the Assistant Attorney General should be the formal owner of the grant closeout process.
Formal, OJP-wide roles and responsibilities should be established to support the improved closeout process.
Establish performance measures to monitor efficiency and compliance with the OJP-wide closeout process.
The grant closeout process should be fully automated.

Footnotes

All findings listed were identified by OJP in its report entitled, Grant Closeout: Business Improvement Recommendations, Final Version, September 15, 2005.
This review was conducted by OJP Business Process Improvement (BPI) Design Group, which was comprised of representatives from OJP program and support offices. The BPI is an OJP Executive Steering Committee initiative that supports the OJP Management Plan goal of improving OJP’s core business processes.