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U. S. Department of Justice
Office of Community Oriented Policing Services (COPS) |
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| To: |
Guy K. Zimmerman
Assistant Inspector General for Audit
Office of the Inspector General |
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| From: |
Carl R. Peed
Director
Office of Community Oriented Policing Services (COPS) |
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| Date: |
November 27, 2006 |
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| Subject: |
Draft Audit Report on the Department of Justice’s Grant Closeout Process |
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This memorandum is in response to the Office of the Inspector General’s (OIG) above-referenced draft audit report dated November 3, 2006, as it relates to the COPS Office.
The COPS Office has always recognized the importance of closing grant awards in a timely manner and has made grant closeout an office-wide priority, successfully closing more than 24,000 grants to date. In accordance with the need to set forth policy, provide procedural guidance, and delineate responsibilities across the agency for closing COPS grant awards, the Grants Administration Division established a Closeout Team in 1998, with grant closeouts as its primary focus. A substantive “Closeout Policy and Procedures Manual” was also developed by the agency in 2000, and has since been updated and revised twice (in 2002 and 2004) in order to streamline our closeout processes and enhance efficiency.
Despite our efforts to aggressively move the closeout process forward, COPS has faced a number of inherent challenges that have impeded our ability to close many of those earliest grants within a shorter span of time. Bearing in mind that the COPS Office did not begin to make grants until 1995, the bulk of those grants were to communities to hire law enforcement officers for a period of three years. That meant that, at best, the COPS Office could not begin to initiate any grant closure until at least 1998-1999. In addition, to allow the communities the time they needed to successfully complete their grants by hiring officers for the entire three years, communities requested and received grant extensions averaging approximately 18 months from the original end date, to allow time for recruitment, hiring, training, deployment and backfilling vacancies. That meant the COPS Office could not begin to initiate closeout on those grants until approximately 2000-2001. In addition to these hiring grants, our technology and equipment awards required extensions from their original award end dates in order to allow grantees sufficient time to successfully complete the awards. In most cases, the COPS Office was not able to initiate the closeout process for these grants until after the extended award end date.
Unanticipated delays in initiating closeout on the earliest hiring grants were also caused by the “supplemental” award system used by the COPS Office until June 2000. Under that system, agencies receiving a hiring award for the first time were granted what was known as an “original” award, with a specific grant number corresponding to that award. Any subsequent UHP funding received by an agency was known as a “supplemental” award (e.g., Supplement #1, #2, etc.), and although these supplemental awards had unique start and end dates, they kept the same grant number as the original award, regardless of how many supplements were awarded. Many hiring grantees received three, four, or even five supplemental awards. Although this supplemental award system won the Attorney General’s “JustWorks” award in 1997 for its innovative streamlining and ease of grantee use, it also severely limited the ability of the COPS Office to close grants in a timely manner, as thousands of grants with one or more supplements could not be closed until the expiration of the final supplement awarded under the original grant number. In many cases, the period of time between the expiration of a grantee’s initial hiring award and the expiration of their final supplement was five years or more.
In June 2000, the COPS Office ended the use of the supplemental award system, and each new hiring grant awarded thereafter received its own unique grant number. This change in the grant award process has allowed the Grants Administration Division to initiate the closeout of each individual grant award shortly after its end date. As a result, the COPS Office is now able to financially and programmatically close expired hiring awards in a more timely and efficient manner than was possible under the supplemental system. The COPS Office continues to seek ways to improve our grant administration processes in order to ensure timeliness and accuracy in the closure of all grant awards, and appreciates the recommendations offered by the OIG for additional areas of improvement and enhancement.
For ease of review, the draft audit recommendations pertaining to the COPS Office are stated in bold and underlined, followed by the COPS Office’s response to each recommendation.
Recommendation 1: Revise and fully implement grant closeout policies and procedures to ensure that expired grants are closed within 6 months after the end date.
The COPS Office concurs.
The COPS Closeout/Withdrawal team is currently in the process of initiating an agency-wide review of the COPS Closeout Policy and Procedures Manual, which was last revised in August 2004. This review process will encompass a comprehensive and complete review of all current closeout policies and practices. An emphasis will be placed on adding specific language that clearly directs the efficient processing of eligible grants through the establishment of a processing timeline that ensures the final closure of all eligible grants within six months of the end date. The COPS Office will fully implement this new six-month processing timeline once the backlog of currently expired grants has been addressed.
Recommendation 2: Ensure that grant closeout policies and procedures include timeframes within which specific actions should be completed, including a requirement that grants must be closed within 6 months after the grant end date.
The COPS Office concurs that the Closeout Policy and Procedures Manual should include specific timeframes for completing closeout actions once a grant has expired. When the COPS Office updates the current Closeout Policy and Procedures Manual (see response to Recommendation #1), specific timeframes for closure milestones will be developed and incorporated into the manual. As noted above, one such milestone to be included within the processing timeframe is the closure of all expired grants within six months of the grant end date.
Recommendation 3: Establish a system to track progress towards eliminating the backlog within the established timeframe.
The COPS Office concurs.
The COPS Grants Administration Division will increase the amount of current vetting cycles performed in order to expedite the identification of eligible grants for closure. A four-fold process of identifying specific grants will continue to be implemented. This process includes direct input from program managers, COPS Finance Staff, the COPS Department Annual Progress Report (DAPR), and through the established vetting process. The continual implementation of this identification process should eliminate the current backlog of eligible grants by the end of calendar year 2007. The COPS Office will utilize existing tracking methods, such as proactive database queries and management reports, to monitor the progress of eliminating the closeout backlog. Concurrently, while completing the milestone of eliminating the expired grant backlog, the COPS Office will update the tracking system, as necessary, to ensure the closure of grants on a regular basis within six months of the end date.
Recommendation 8: Ensure that grantees are not allowed to draw down funds more than 90 days after the grant end date without requesting and receiving an extension not to exceed 90 days.
The COPS Office concurs and, as appropriate, will take appropriate action to ensure that grantees are not allowed to draw down funds more than 90 days after the grant end date. The COPS Office will develop and implement a practice for allowing grantees to request and receive, under specific and limited circumstances, additional time solely for the purpose of drawing down grant funds after the 90-day liquidation period has passed.
Recommendation 9: Work with the Office of Justice Programs Office of the Comptroller to add a control to the current grant payment system that will prohibit grantees from drawing down funds after the end of the 90-day liquidation period.
The COPS Office concurs and will request that the Office of Justice Programs Office of the Comptroller (OJP-OC) add a control to their grant payment system prohibiting grantees from drawing down funds after the end of the 90-day liquidation period. [As the OIG has noted in the audit report, the grant payment system is administered by the OJP-OC, and not by the COPS Office.]
Recommendation 10: Remedy the $226,856,849 in questioned costs related to drawdowns occurring more than 90 days past the grant end date.
The COPS Office concurs, and will review the grants in question and take appropriate steps to address the $226,856,849 in questioned costs.
Recommendation 11: Work with the Office of Justice Programs Office of the Comptroller to ensure that the current grant payment system includes a control to prohibit negative award balances, e.g., total payments in excess of the net award amount.
The COPS Office concurs and will request that OJP-OC ensure the current grant payment system includes a control to prohibit negative award balances, such as total payments in excess of the net award amount.
Recommendation 12: Remedy the questioned costs totaling $45,688 related to grants for which the drawdowns exceeded the total award amount.
The COPS Office concurs, and will review the grants in question and take appropriate steps to address the $45,688 in questioned costs related to grants for which the drawdowns exceeded the total award amount.
Recommendation 13: Ensure that grantees are not allowed to draw down funds for unallowable expenditures obligated after the grant end date.
The COPS Office concurs that grantees should not be allowed to draw down funds for unallowable expenditures obligated after the grant end date and will take the appropriate steps as required by the Expired Grants Policy.
Recommendation 14: Ensure that grantees are not allowed to draw down excess funds for unsupported expenditures.
The COPS Office concurs that grantees should not be allowed to draw down excess funds for unsupported expenditures and will take appropriate action.
Recommendation 15: Immediately discontinue the practice of allowing grantees to draw down unliquidated obligations beyond the 90-day liquidation period without an extension.
The COPS Office concurs and will take appropriate action to discontinue the practice of allowing grantees to draw down unliquidated obligations beyond the 90-day liquidation period without an extension.
Recommendation 32: Ensure that all funds remaining on grants are deobligated within 180 days after the expiration of the grant and regranted, or returned to the general fund.
The COPS Office concurs and will take the appropriate steps to ensure that all funds remaining on grants that have been expired for more than 90 days are deobligated and regranted, or returned to the general fund as necessary, within 180 days after the expiration of the grant.
Recommendation 33: Deobligate and put to better use the $88,587,211 in remaining funds related to expired grants that are more than 90 days past the grant end date.
The COPS Office concurs and will review the grants in question and take appropriate steps to address the $88,587,211 in remaining funds related to expired grants that are more than 90 days past the grant end date.
Recommendation 34: Ensure that remaining grant funds are deobligated prior to closure.
The COPS Office concurs and will take the necessary steps to ensure that remaining grant funds are deobligated prior to closure.
Recommendation 35: Deobligate and put to better use the $2,849,825 in remaining funds related to grants that were reported as closed.
The COPS Office concurs and will review the grants reported as closed with a balance of $2,849,825, and take appropriate action as necessary.
Recommendation 36: Remedy the $147,862 in questioned costs related to drawdowns occurring after the grant was reported as closed.
The COPS Office concurs and will review the grant in question and take appropriate steps to address the $147,862 in questioned costs related to drawdowns occurring after the grant was reported as closed.
The COPS Office thanks the Office of the Inspector General for the opportunity to review and respond to the draft audit report. If you have any questions, please contact Cynthia Bowie, Assistant Director, Audit Liaison Division at (202) 616-3645; or Martha Viterito, Program Audit Liaison, at (202) 514-6244.
| cc: |
Robert A. Phillips
Deputy Director for Operations
COPS Office
Richard P. Theis
Acting Director
DOJ/JMD Audit Liaison Office
Mary T. Myers
Audit Liaison Specialist
DOJ/JMD Audit Liaison Office
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