The federal government supports state, local, tribal, and territorial governments, as well as domestic private and nonprofit organizations, through a suite of nearly 2,300 grants and other financial assistance. These grants, totaling $624.4 billion in fiscal year 2015, help fund nearly every facet of public services, including economic support, research, infrastructure, and many other programs. Yet the federal government has difficulty tracking and accounting for this spending, in part because the more than 28 federal departments and agencies administering grants do not collect information from grantees in a standardized way.
These differences also substantially increase the reporting burden for grantees, primarily state and local governments, who must complete a multitude of forms and reports, each asking for information in its own way. Local governments are under continuous pressure to do more with less, and onerous reporting requirements can be an obstacle in applying for federal grants. The difficulty of complying with reporting requirements and restrictive spend-down timelines has left many cities and towns unable to use the grant money they need.
The Digital Accountability and Transparency Act of 2014 (DATA Act) took a step toward addressing this challenge. The DATA Act directed the Office of Management and Budget (OMB) to develop a standardized electronic version of all federal grant reporting requirements. OMB delegated this task to the Department of Health and Human Services (HHS), which developed a data dictionary of more than 11,000 data elements used in grant reports, known as the Common Data Element Repository Library. HHS is currently testing whether this taxonomy will enable grantees to reduce administrative effort and costs by submitting their grant reports electronically. HHS plans to evaluate the taxonomy’s effectiveness by August 2017.
If the Common Data Element Repository Library reduces reporting burden, OMB should mandate its use across the federal government for grant reporting beginning in fiscal year 2019. To accomplish this goal, all grant-awarding federal agencies, along with key actors from state, local, and tribal governments, will need to participate in developing a plan for national implementation. They should produce this implementation plan by January 2018. The plan should include full government-wide implementation, including a necessary adjustment period. Additional efforts to reduce burden could include using the same collection mechanism for the single audit program, a largely duplicative review required for larger grantees.
By replacing document-based grant reporting with standardized, open data, the government can improve the management, transparency, and outcomes of all grants. Implementing the Common Data Element Repository Library across the federal government is the first step toward making this transformation. Additional standardization across grant reporting, particularly with respect to the tracking and reporting of unspent funds, will also be necessary. Even more importantly, streamlined grant procedures across all federal agencies could make the federal grant process much simpler for grantees and can serve as a cornerstone for engendering greater transparency—opening federal grant data for citizens and other stakeholders in expanded and meaningful ways.