$400 Million Wasteland

A Washington Post investigation released this year found 700 projects awarded $400 million that have been idling for years or just plain abandoned. The U.S. Department of Housing and Urban Development (HUD) is supposed to oversee the housing funds but has failed to track projects or identify failing ones. The result has been failed projects all over the country. The yearlong investigation into a database of 5,100 projects uncovered “a dysfunctional system that delivers billions of dollars to local housing agencies with few rules, safeguards or even a reliable way to track projects.” The investigation also found that funds were being given to troubled developers, fledgling nonprofits and even groups accused of fraud.

Here are just a few of the projects that the Washington Post investigation found:

- “In Inglewood, Calif., a sprawling, overgrown lot two blocks from city hall frustrates senior citizens who were promised a state-of-the-art housing complex more than four years ago. Although the city invested $2 million in HUD funds, the developer doesn’t have the financing to move forward.”

-”In Newark, two partially completed duplexes sit empty in a neighborhood blighted by boarded-up homes lost to foreclosure. The city paid nearly $400,000 to build the houses, but after a decade of delays, the developer folded and never finished. The money has not been repaid.”

-”The D.C. region has a particularly troubled track record. In Prince George’s County, the nonprofit Kairos Development Corp., received $750,000 in 2005 to build dozens of homes. Six years later, Kairos has not built a single house.”

Just another example of government waste and zero accountability.

View the full report here.

$125 billion in improper federal grant payments made in 2010

Last June the Government Accountability Office (GAO) released a report which found that in 2010 alone $125 billion in improper federal grant payments were made. Federal Grants have become an increasingly popular way to achieve national objectives – from 1990 to 2010 the federal grant program has grown from $135 billion to $600 billion. The improper payments in 2010 account for over 20% of the annual budget!

So how do improper grants happen–the GAO report goes on, “Our audits found that agencies awarded grants without adequately documenting the grantee selection process. In some instances,we found agencies did not perform preaward reviews until after the grants had been awarded.“

“Through our work, we found weaknesses in grant oversight and accountability issues that span the government. Specifically, we identified long-standing challenges in oversight of undisbursed grant award balances, and significant levels of improper payments in grant programs…In August 2008,we reported that during calendar year 2006 about $1 billion in undisbursed funding remained in expired grant accounts…We recommended in August 2008 that the Director of OMB instruct executive departments and independent agencies to annually track the amount of undisbursed grant funding remaining in expired grant accounts and report on the status and resolution of such funding in their annual performance plans and Performance and Accountability Reports. As of April 2011, OMB had not issued governmentwide guidance regarding undisbursed balances in expired grant accounts.”

The GAO has issued multiple reports over the years on Federal Grant programs and has consistently come up with the same deficiencies – the grants are being made improperly or not made at all. Their reports always contain recommendations on how to remediate the deficiencies and subsequent reports show these recomendations go unimplemented.

What is the point of the GAO if no one will ever be held accountable?

View the full report here