	Background

Postsecondary institutions that serve large proportions of low-income and  minority students are eligible to receive grants from Education through  programs authorized under Title III and Title V of the Higher Education  Act, as amended. Long-Standing Deficiencies in Grant Monitoring and Technical Assistance Limit Education’s Ability to Ensure That Funds Are Used Properly and Grantees Are Supported

		Education Has Made Limited Progress toward Implementing a Systematic Approach to Monitoring and Technical Assistance

GAO and Education’s Inspector General have recommended multiple  times that Education implement a systematic monitoring approach to  better assess the fiscal and programmatic performance of Title III and V  grantees. In our 2009 report, however,  we found that while Education had taken some steps to better target its  monitoring in response to our previous recommendation, many of its  initiatives had yet to be fully realized. Accordingly, we recommended that  the Secretary of Education develop a comprehensive, risk-based approach  to target grant monitoring and technical assistance based on the needs of  grantees. At this time, however, Education  is still in the process of modifying its monitoring approach and it is too  early to determine the effectiveness of its efforts. Annual Monitoring Plans

Our 2009 report found that Education still lacked a coordinated approach  to guide its monitoring efforts. The plan for Title III and V  programs outlines Education’s monitoring approach and describes various  monitoring tools and activities—such as the monitoring index and site visits;  how they are to be used to target limited monitoring resources to grantees  that need it most; and an increased focus on staff training. Site Visits

With the implementation of an electronic monitoring system and risk-based  monitoring index, Education now has tools to enhance its ability to select  grantees for site visits, a critical component of an effective grants  management program. In our 2009 report,  however, we found that overall site visits to Title III and V grantees had  declined substantially in recent years (see table 3), and Education was not  making full use of its risk-based criteria to select grantees for visits. In response to our 2009  report, Education officials said that they would use the revised monitoring  index to select half of the schools chosen for site visits. However, none of  the five site visits completed so far in fiscal year 2010 was selected based  on the monitoring index. For  example, Education had developed courses on internal control and grants  monitoring, but these courses were attended by less than half of the  program staff. Education agreed with the recommendation and has developed additional  training in key areas. Technical Assistance

While Education provides technical assistance for prospective and current  Title III and V grantees through preapplication workshops and routine  interaction between program officers and grant administrators at the  institutions, our 2009 report found that it had not made progress in  developing a systemic approach that targeted the needs of grantees. To improve the provision of technical assistance, our 2009 report  recommended that Education disseminate information to grantees about  common implementation challenges and successful projects and develop  appropriate mechanisms to collect and use grantee feedback. Education Lacks Assurance That Grant Funds Are Used Appropriately

Without a comprehensive approach to target its monitoring, Education  lacks assurance that grantees appropriately manage federal funds,  increasing the potential for fraud, waste, or abuse. At one institution—Grantee D—we identified significant internal control  weaknesses and $105,117 in questionable expenditures. Targeting monitoring and assistance to grantees with the greatest risk and  needs is critical to ensuring that grant funds are appropriately spent and  are used to improve institutional capacity and student outcomes.
Why GAO Did This Study

Higher education has become more accessible than ever before, although students from some demographic groups still face challenges in attending college. To help improve access to higher education for minority and low-income students, Titles III and V of the Higher Education Act, as amended, provide grants to strengthen and support institutions that enroll large proportions of these students. GAO was asked to testify on the Department of Education's (Education) oversight of institutions receiving Title III or V grants and progress Education has made in monitoring the financial and programmatic performance of Title III and V grantees. GAO's testimony is based primarily on its recent report, Low-Income and Minority Serving Institutions: Management Attention to Long-standing Concerns Needed to Improve Education's Oversight of Grant Programs ( GAO-09-309 , August 2009) and updated information provided by Education. In that report, GAO recommended that Education, among other things, (1) develop a comprehensive, risk-based approach to target monitoring and technical assistance; (2) ensure staff training needs are fully met; (3) disseminate information about implementation challenges and successful projects; and (4) develop appropriate feedback mechanisms. No new recommendations are being made in this testimony.

What GAO Found

GAO's 2009 report found that Education had taken steps in response to previous GAO recommendations to improve its monitoring of Title III and V grants, but many of its initiatives had yet to be fully realized. A coordinated, risk-based approach, targeting monitoring and assistance to grantees with the greatest risk and needs is critical, especially as Education's oversight responsibilities are expanding. Education agreed with GAO's 2009 recommendations and has begun taking steps to implement them, but it is too early to determine the effectiveness of these efforts, described below. (1) Risk-based monitoring criteria: At the time of the 2009 report, Education had developed a monitoring index to identify high-risk institutions, but was not using it to target schools for site visits. Education committed to use the index to select half of its fiscal year 2010 site visits, but none of the visits completed to date were based on the monitoring index. (2) Annual monitoring plan: Because it stopped developing annual monitoring plans for Title III and V programs in 2006, GAO determined that Education lacked a coordinated approach to guide its monitoring efforts. Since then, Education has developed a 2010 monitoring plan, but some of the monitoring activities lack realistic and measurable performance goals. (3) Site visits and staff training: The 2009 report found that site visits to Title III and V grantees, a key component of an effective grants management program, had declined substantially in recent years and that staff lacked the skills to conduct financial site visits. Since then, site visits have remained limited, but Education has developed training courses to address the skill deficits identified that about half the program staff have attended. (4) Technical assistance: The 2009 report found Education had not made progress in developing a systemic approach to target the needs of grantees. In response to GAO's recommendations, Education has taken some steps to encourage grantee feedback and information sharing among grantees. Without a comprehensive approach to target its monitoring, GAO previously found that Education lacked assurance that grantees appropriately manage federal funds, increasing the potential for fraud, waste, or abuse. For example, GAO identified $105,117 in questionable expenditures at one school, including student trips to amusement parks and an airplane global positioning system.