Community Services Block Grant: Better Alignment of Outcome Measures with Program Goals Could Help Assess National Effectiveness

CSBG is one of the key federal programs focused on reducing poverty in the United States. In fiscal year 2019, CSBG provided about $700 million in block grants to states. In turn, states provided grants to more than 1,000 local agencies, which used the funding to provide housing and other services to program participants. HHS is responsible for overseeing states' use of this funding, and states have oversight responsibility for local agencies. GAO was asked to review CSBG program management.

This report examines (1) how HHS and selected states conduct their oversight responsibilities and (2) how HHS assesses the effectiveness of the CSBG program. GAO reviewed files for six of the 12 states where HHS conducted onsite compliance evaluations during fiscal years 2016 and 2017, and six states where HHS conducted routine monitoring—five of which were randomly selected. GAO visited three states, selected based on their CSBG funding amount and other factors, to conduct in-depth reviews of their monitoring activities. GAO also reviewed agency documents and interviewed HHS and selected state and local officials.

The Department of Health and Human Services (HHS) and the selected states GAO reviewed provided oversight of the Community Services Block Grant (CSBG) program through onsite visits and other oversight activities to assess grant recipients' use of funds against program requirements. Specifically, GAO found:

HHS and the selected states conducted required oversight activities. The Community Services Block Grant Act requires HHS to conduct compliance evaluations for several states each year and requires states to conduct onsite visits to local CSBG recipients at least once every 3 years to evaluate whether recipients met various goals.

During fiscal years 2016 and 2017, HHS conducted onsite compliance evaluations for 12 states that it deemed most at risk of not meeting CSBG requirements.

GAO's visits to three states found that all three had conducted onsite visits to local grantees during the same fiscal years.

HHS and the selected states also conducted additional oversight activities. This included routine reviews and quarterly calls.

HHS and state monitoring activities primarily identified administrative errors, instances of non-compliance and other issues, which grant recipients took steps to address. For example, a HHS fiscal year 2017 compliance evaluation found that in fiscal year 2015 one state neither implemented procedures to monitor and track findings from a state audit, nor monitored eligible entities as required.

HHS uses state outcome data to report on CSBG's national effectiveness, but these data are not aligned with the national program goals to reduce poverty, promote self-sufficiency, and revitalize low-income communities. HHS recently redesigned its' performance management approach to improve its ability to assess whether the CSBG program is meeting these three goals, but several elements of the approach do not align with leading practices in federal performance management. GAO found that HHS's redesigned approach does not demonstrate:

How the agency's newly developed national performance measure—intended to provide a count of the number of individuals who achieved at least one positive outcome through CSBG funds—will assess the program in meeting national program goals.

How the state outcome data, consisting of more than 100 state and local program measures, relate to CSBG's three national goals.

How data collected from state and local agencies will be assessed for accuracy and reliability.

Without aligning its redesigned performance management approach with leading practices, OCS cannot properly assess its' progress in meeting CSBG's three national goals.

GAO is recommending that HHS's new performance management approach include information on how its performance measure and state outcome measures align with program goals and how it will assess data reliability. HHS agreed with GAO's recommendation.

In fiscal year 2019, the Community Services Block Grant (CSBG)  program provided about $700 million to fight poverty in the United  States—funding that went to each of the states and supported over 1,000  local antipoverty agencies. These local agencies, predominantly  community action agencies, use CSBG funding to aid them in providing a  variety of programs and services such as employment, education,  financial management, housing, nutrition, and emergency services to help  program participants achieve economic self-sufficiency.  They also often  use CSBG funds to strengthen their institutional frameworks for providing  services, including staff and facilities. The Office of Community Services  (OCS) within the Department of Health and Human Services (HHS) is  primarily responsible for overseeing states that receive the block grant,  and states are responsible for overseeing local agencies that receive the  grant funding.

Past GAO reports and other reviews have identified deficiencies in federal  oversight efforts to ensure that OCS is meeting legal requirements for  overseeing states and internal controls for the CSBG program.  Specifically, in a February 2006 letter and June 2006 report, we found  that OCS lacked effective policies, procedures, and controls to help  ensure that it fully met legal requirements for overseeing states and  internal control standards, and recommended actions to address these  issues, which OCS took steps to address. Nonetheless, almost a decade  later, a 2014 HHS Office of Inspector General (OIG) review found that  many of the issues we identified had resurfaced. You asked that we  review the efforts that OCS and states have undertaken to oversee the  use of CSBG funds. This report examines (1) the activities that HHS and  states conduct to oversee the state and local agencies that receive CSBG  funds, and (2) the extent to which HHS assesses the outcomes of the  CSBG program.

To address both of our objectives, we reviewed relevant federal laws,  federal grants management guidance, and agency documents that  describe the federal requirements and responsibilities for overseeing  states’ CSBG programs and assessing program outcomes. We scoped  our review of the CSBG program to include the 50 states, American  Samoa, the District of Columbia, Guam, Northern Mariana Islands, Puerto  Rico and the United States Virgin Islands, which are defined as states  under the CSBG Act.

For our first objective, we obtained and reviewed available information on  OCS’s policies and procedures, including the risk assessment criteria  OCS uses to select states for onsite compliance evaluations, and  interviewed OCS officials about their oversight efforts. We selected 12  states for an in-depth review of OCS’s oversight activities. These included  six states (Indiana, Louisiana, Michigan, New York, North Carolina, and  Texas) of the 12 states for which OCS conducted onsite compliance  evaluations during fiscal years 2016 and 2017. In fiscal year 2016 and  2017, OCS also conducted onsite reviews of: Alabama, Arkansas,  Connecticut, South Carolina, Florida, and Tennessee. For our review, we  selected states that OCS had prioritized as the top three states to visit  during each of the two fiscal years. We used a random number generator  to randomly select five of the six of the remaining states (Alaska,  Colorado, Kentucky, Mississippi, and Rhode Island) where OCS did not  conduct onsite compliance evaluations, but conducted a routine review,  which it does yearly for all states. We also selected a sixth state—North  Dakota—because OCS had not visited the state in several years. We  reviewed OCS’s file documentation for both sets of selected states  including a review of OCS’s comments on each section of state program  documents such as state plans and annual reports, actions states took to  address OCS comments, state fiscal controls, and financial and program  oversight documents. We compared the results to identify whether there  were any notable differences between the two sets. While our findings are  non-generalizable, they provide insight into the different levels of review  OCS conducts and examples of OCS oversight actions.

We visited three of the 12 states in our review: two states (New York and  Texas) for which OCS conducted onsite compliance evaluations and one  (North Dakota) for which OCS conducted a routine review. We selected  these three states based on a range of considerations including  recommendations from OCS officials and experts about states with  promising practices. To ensure some variation in our sample, we also  considered the amount of CSBG funding states received, the year of  OCS’s last onsite compliance evaluation since 2008, and the number of  local agencies receiving CSBG funds within the state. For each of these  three states, we obtained and reviewed documentation of oversight  activities from the CSBG state agency and reviewed organization-wide  audits of the state and local agencies conducted during fiscal years 2016  and 2017. During our visits, we interviewed officials with CSBG state and  state audit agencies about oversight issues, including promising practices  and challenges. We also interviewed officials from two local agencies that  received CSBG funds in each of the three states. Table 1 summarizes  OCS and GAO reviews of the states selected for review.

To address our second objective, we reviewed the program performance  indicators OCS uses to measure program outcomes in relation to the  stated goals of the CSBG program. We also reviewed OCS’s design and  implementation plans for a new performance management approach,  including revised performance measures for assessing program  outcomes. We interviewed OCS officials about the goal of, and changes  to, the performance management approach and reporting requirements.  Additionally, we interviewed state officials on their experience with CSBG  program performance and reviewed leading practices in grant  performance management as identified in federal guidance and GAO  reports. For additional information on our scope and methodology, see  appendix I.

We conducted this performance audit from to May 2018 to November  2019 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.

The CSBG program is intended to focus on three overall (national) goals:  reducing poverty, empowering low-income families and individuals to  become self-sufficient, and revitalizing low-income communities. The  program is administered by OCS within the Administration for Children  and Families (ACF) at HHS. CSBG was an outgrowth of the War on  Poverty of the 1960s and 1970s, which established the Community Action  program under which the nationwide network of local community action  agencies was developed. The federal government had direct oversight of  local agencies until 1981, when the CSBG program was established and  states were designated as the grant recipients. OCS and states now  share responsibility for oversight of CSBG grantees. In fiscal year 2019,  states received approximately $700 million of the total $725 million CSBG  appropriation. Appendix II provides the funding amounts for each state.

OCS distributes CSBG funding to states and they, in turn, distribute funds  to over 1,000 local agencies. Most of these local agencies receive funding  from a variety of federal, state, and private sources. In fiscal year 2017,  the latest data available, local agencies received about $9 billion from all  federal sources, including about $700 million from CSBG. Other federal  programs providing funding include Head Start, the Low Income Home  Energy Assistance Program (LIHEAP), the Community Development  Block Grant (CDBG), the Child Care and Development Block Grant,  Temporary Assistance for Needy Families, and the Social Services Block  Grant (see fig. 1). Programs administered by ACF contributed about $6.6  billion of the funds provided to local agencies.

CSBG funding can be used broadly, allowing state and local agencies  flexibility to provide services tailored to organizational and community  needs. CSBG funds can be used by local agencies to provide services to  participants in their programs and fill gaps in the funding provided by  other means. For example, local agencies may use CSBG funds to  support a position for a staff member who determines the service needs  of potential participants and connects them with the appropriate  services—a position that would not be an allowable expense under the  funding rules of other federal programs, according to a local agency  official we interviewed. Local agencies have also used CSBG funding to  leverage other public and private resources to support a variety of  initiatives, such as Head Start programs, low-income energy assistance  programs, and low-income housing.

OCS monitors all states receiving grant funds to ensure that they are  meeting the standards for federal grant programs set by the Office of  Management and Budget (OMB) and the specific expenditure  requirements for the program. The CSBG Act requires that states submit  plans to OCS describing how they intend to use the funds to address the  needs of the local community and annual reports detailing the actual use  of funds, including information on state performance results and  populations served. OCS is required by the CSBG Act to conduct  compliance evaluations of several states each fiscal year to review the  states’ use of CSBG funds, report to states on the results of these  evaluations, and make recommendations for improvements. However,  the CSBG Act does not specify the number of states subjected to an  evaluation each year or the timeframe each state must undergo such  evaluations. Following a compliance evaluation, states are required to  submit a plan of action in response to any OCS recommendations. In  addition to conducting compliance evaluations to assess states’ use of  CSBG funds, OCS is required to submit an annual report to Congress.  This annual report must include a summary of how states and local  agencies had planned to use CSBG funds; how funds were actually  spent, data on the number and demographics of those served by local  agencies, and other information.

The CSBG Act requires OCS to provide training and technical assistance  to states and to assist them in carrying out corrective action activities and  monitoring. OCS must reserve 1.5 percent of annual appropriations (in  fiscal year 2019, this percentage totaled about $11 million of the total  appropriation) for many activities, including training and technical  assistance; planning, evaluation, and performance management;  assisting states with carrying out corrective action activities; and oversight  including reporting and data collection activities.

The CSBG Act also requires that states complete several steps before  terminating an underperforming entity. The state agency is required,  among other things, to provide training and technical assistance, if  appropriate, to help the agency correct identified deficiencies, review the  local agency’s quality improvement plan, and provide an opportunity for a  hearing. The entity can request a federal review of the state’s decision to  reduce or terminate funding, which must be completed within 90 days of  OCS’s receipt. During this period, the state is required to continue funding  the entity until OCS responds to the request.

The CSBG Act requires each state to designate a lead state agency to  administer CSBG funds and provide oversight of local agencies that  receive funds. States are required to award at least 90 percent of their  federal block grant allotments to eligible local agencies, and to determine  how CSBG funds are distributed among local agencies. States may use  up to $55,000 or 5 percent of their CSBG allotment, whichever is higher,  for administrative costs. States may use remaining funds for the provision  of training and technical assistance, and other activities. In addition,  states and local agencies that expend $750,000 or more in total federal  awards are required to undergo an audit annually and submit a report to  the Federal Audit Clearinghouse.

The CSBG Act requires states to determine if local agencies meet the  performance goals, administrative standards, and financial management  requirements for the CSBG program. For each local agency, the CSBG  Act requires the state to conduct: a full onsite review at least once during each 3-year period; an onsite review of each new local agency following the completion of  the first year receiving CSBG funds;  followup reviews including prompt return visits to local agencies that  fail to meet goals, standards, and requirements established by the  state; and other reviews as appropriate, including reviews of local agencies  found to have had other grants terminated for cause.

For states to receive CSBG funding, they must submit an application and  state plan at least biennially describing, among other things, how they will  use CSBG funds to accomplish various things such as helping families  and individuals to achieve self-sufficiency, find and retain meaningful  employment, and obtain adequate housing. Within their state plan,  states must attest that (1) funds will be used to address the needs of  youth in low-income communities; (2) funds will be used to coordinate  with related programs; and (3) local agencies will provide emergency  food-related services. States must also complete annual reports that  include fiscal, demographic, and performance data.

In their state plans, states must provide an assurance that all local  agencies will submit a community action plan that includes a community  needs assessment for the community served. In addition, local agencies  must administer the CSBG program through a three-part board,  consisting of one-third elected public officials and at least one-third  representatives of the low-income community, with the balance drawn  from officials or members of the private sector, labor, religious, law  enforcement, education or other groups in the community served.

The Government Performance and Results Act of 1993 (GPRA) as  enhanced by the GPRA Modernization Act of 2010 (GPRAMA) focuses  federal agencies on performance by, among other things, requiring  agencies (including HHS) to develop outcome-oriented goals and a  balanced set of performance indicators, including output and outcome  indicators as appropriate, to assist agencies in measuring or assessing  their progress toward goals. OMB provides guidance to federal  executive branch agencies on how to prepare their strategic plans in  accordance with GPRA requirements. We have reported that strategic  planning requirements established under GPRA and GPRAMA can also  serve as leading practices for strategic planning at lower levels within  federal agencies.

Federal standards for internal control help to ensure efficient and effective  operations, reliable financial reporting, and compliance with federal  laws. Internal controls help government program managers achieve  desired results through effective stewardship of public resources. Such  interrelated controls comprise the plans, methods, and procedures used  to meet missions, goals, and objectives. Internal controls support  performance-based management and should provide reasonable  assurance that an organization achieve its objectives of (1) effective and  efficient operations, (2) reliable reporting, and (3) compliance with  applicable laws and regulations.

With regard to performance measurement for state and local agencies,  the CSBG Act requires OCS, in collaboration with states and local  agencies, to facilitate the development of one or more model performance  measurement systems which may be used by states and local agencies  to measure their performance in fulfilling CSBG requirements. Each  state receiving CSBG funds is required to participate in and ensure that  all local agencies in the state participate in either a performance  measurement system whose development was facilitated by OCS or in an  alternative system approved by OCS. OCS developed the Results  Oriented Management and Accountability (ROMA) performance  management approach that states and local agencies follow when  overseeing programs and measuring their performance in achieving their  CSBG goals. In 2012, OCS began four initiatives to update how it  oversees the performance of the CSBG program, and as of April 30 2019,  OCS had implemented all four of the initiatives, which include: an updated ROMA process for program management,

58 organizational management standards for local agencies, new federal and state accountability measures, and an updated annual report format where oversight and performance  information from states is collected in an automated online data  system.

In addition, OCS developed the CSBG Theory of Change which illustrates  how the core principles of the CSBG program, the performance  management framework, and services and strategies offered with CSBG  funds relate. The three national goals established under the CSBG  Theory of Change are similar to the three national goals identified in the  CSBG Act, but are not identical. The three goals under the CSBG Theory  of Change are:  1.  individuals and families are stable and achieve economic security,  2.  communities where low-income people live are healthy and offer  3.  people with low incomes are active in their community.

OCS and Selected States Conducted Onsite and Routine Oversight Activities and Provided Training and Technical Assistance to CSBG Grant Recipients

OCS and states are responsible for conducting oversight activities to  ensure that CSBG recipients use the funds in accordance with the CSBG  Act, which includes ensuring that the funds are used in line with the  grant’s three national goals related to addressing the causes and  conditions of poverty. Our review of oversight efforts during fiscal years  2016 and 2017 for the select states showed that OCS and states  conducted required oversight activities, as well as additional oversight  activities, and provided training and technical assistance to help CSBG  recipients meet CSBG program requirements. Our review of file  documentation for six selected states where OCS conducted compliance  evaluations during fiscal years 2016 and 2017, and six selected states  where OCS conducted routine oversight, showed that OCS identified  primarily administrative issues, but in some instances identified non- compliance and other more serious issues that required corrective actions  that states took action to resolve. We largely found similar results in our  review of the selected states’ onsite and routine oversight activities for  local CSBG funds recipients for the same time period. Beyond findings of  an administrative nature, a fiscal year 2017 OCS compliance evaluation  found that one state did not conduct required monitoring of its eligible  entities during fiscal year 2015. Also, one state identified financial  mismanagement, which resulted in termination of a local grantee from the  CSBG program. Additionally, we found that OCS and states provided  training and technical assistance to help CSBG recipients meet  requirements.

OCS and Selected States Conducted Onsite and Routine Oversight Activities, and Identified Issues Requiring Corrective Actions

OCS officials conducted onsite compliance evaluations, in addition to  other oversight activities, for 12 states using a risk assessment and  prioritization process during fiscal years 2016 and 2017. We reviewed  six of these 12 states and found that a majority of errors identified by  OCS were administrative. The CSBG Act requires OCS to conduct  compliance evaluations for several states each year. Since fiscal year  2009, OCS has conducted onsite compliance evaluations in five to seven  selected states each year, in addition to the routine oversight it conducts  for all the states. According to OCS officials, the number of states visited  each year depends upon available resources. OCS primarily bases its  selection of states for onsite compliance evaluations on a risk  assessment conducted using a scoring tool. The scoring tool generates a  risk score of 1 to 5 for each state using a number of measures, as shown  in figure 2. The various factors used in developing the total risk score are  weighted to ensure the most significant risk indicators and prioritization  factors have the most impact on the selection of states for onsite  monitoring. The list of risk factors was developed by OCS in response to  a recommendation from our 2006 report in which we found that OCS did  not systematically use available information to assess risk to focus its  monitoring resources on states with the highest risk.

According to OCS officials, OCS rarely visits states that they identify as  low risk or states that have very few local agencies as grantees, and they  try to not visit the same state within 3 years of their last visit. OCS officials  told us that monitoring resources limit their ability to reach all of the states  for onsite review. We found that, since fiscal year 2008, eight states have  not received an onsite evaluation and 10 had been visited twice.  According to agency officials, the risk assessment is part of a larger risk  assessment and prioritization process designed to direct monitoring  resources over multiple years. After determining risk under the scoring  tool, OCS considers several other factors and may place a higher priority  on states with lower risk scores when selecting states for onsite  compliance evaluations. Agency officials said such factors include:  size of the CSBG award,  findings from single audits,  the rate at which the state spends its CSBG funds,  time since the last OCS visit, and  feedback from the OCS program manager using information gathered  from the quarterly calls with the states.

For states selected for onsite compliance evaluations, we found that OCS  conducts a comprehensive review of each of the state’s plan and annual  reports and examines the state’s supporting documents to determine if  that state is meeting the requirements of the CSBG program. Although  OCS reviews the plans for all 56 states as part of its routine oversight  efforts, during the onsite visit the agency also conducts interviews with  staff and examines state statutes or regulations and supportive  information, such as financial ledgers and oversight procedural manuals.  OCS also reviews the state’s grant funding to determine if the state  allocated the funds in accordance with the requirements of the CSBG  program. Additionally, OCS reviews each state’s fiscal controls and  accounting procedures and associated documents to assess the financial  integrity of the state’s process for drawing down federal funds, providing  funds to local agencies, and reporting financial information. For example,  OCS officials may review the state agency’s bookkeeping system and  accounting software.

In our review of OCS’s file documentation for the six selected states, we  found OCS generally identified administrative errors, but in some  instances identified issues of non-compliance and other issues that the  states took action to resolve. For example, during its fiscal year 2017  onsite visit to Louisiana, OCS found that Louisiana did not implement  procedures to monitor and track prior year single audit findings for  corrective action and issue management decisions as required. To  address this concern, the state assigned a member of its staff to execute  these duties and submitted a copy of the Single Audit Process and audit  log to OCS. Additionally, OCS found that Louisiana did not visit any of its  42 local agencies in fiscal year 2015 because of limited capacity such as  staffing shortages, among other non-compliance issues. OCS determined  that Louisiana addressed this issue by visiting all of the local agencies  before the end of fiscal year 2017. Also, in a fiscal year 2016 onsite visit  to Indiana, OCS found that the state agency did not submit a required  financial report to account for CSBG expenditures within established  timeframes in two consecutive fiscal years—2014 and 2015—due to the  lack of a process to ensure the timely submission of the report. OCS also  found that the financial report for fiscal year 2014 contained incorrect  amounts for certain expenditures. The Indiana state agency responded to  the issues by developing formal written procedures regarding the  preparation and submission of financial reports. In addition, for the six  selected states, we found that OCS had assessed state plans and annual  reports to ensure that the states were complying with the programmatic,  financial, and administrative requirements of the CSBG program, as  outlined in the CSBG Act.

In our review of the selected states, we found that during fiscal years  2016 and 2017, OCS conducted routine reviews and other oversight  activities to assess states’ use of CSBG funds. We selected six states  (Alaska, Colorado, Kentucky, Mississippi, North Dakota, and Rhode  Island) for our review of file documentation of OCS’s routine reviews.  We found that for these six states, the routine reviews consisted of OCS  reviewing all state plans and annual reports to determine if the state  completed all sections of the plan and provided information about how it  would achieve the goals of the program. In our review of file  documentation for the six states, we found that OCS requested states to  provide additional details about their plans; however, like the issues  identified in the onsite compliance evaluations, the issues on which OCS  commented were primarily administrative. For example, in fiscal year  2016, OCS reviewed Colorado’s 2016 annual plan and requested that the  state provide additional details on plans to modify its organizational  standards. Also, in its fiscal year 2017 review, OCS requested that Alaska  provide additional information in its annual plan to explain how the state  would prioritize providing services to individuals based on their income.  We found that the states addressed OCS’s comments.

OCS officials told us that they used quarterly calls as a part of their  routine oversight. Agency officials told us that they generally use quarterly  calls to discuss the state plans and the CSBG program broadly, and  review the annual reports. OCS officials also told us that OCS uses these  calls to update states on issues that have significant impact or importance  on the successful operation of the CSBG grantees. In some cases, OCS  program specialists may use the quarterly calls to identify areas where  the state may be struggling and to discuss ways to address those issues.  In addition, OCS officials stated that OCS program specialists will work  with states to assist with developing work plans or reviewing corrective  action procedures for high-risk local agencies.

All three states we visited (New York, North Dakota, and Texas)  conducted onsite visits to local agencies at least once every 3 years as  required by the CSBG Act, and conducted routine oversight activities. In  response to our June 2006 recommendation, OCS issued guidance  clarifying that states must conduct an onsite review of each local agency  at least once every 3 years. Besides the triennial onsite reviews, the law  requires states to conduct: (1) follow up reviews including prompt return  visits to local agencies that fail to meet state goals, standards, and  requirements, (2) an onsite review of new local agencies following the  completion of the first year receiving CSBG funds, and (3) other reviews  as appropriate, including reviews of local agencies found to have had  other grants terminated for cause.

Each of the states we visited had developed oversight policies and  procedures that included information on how often CSBG programs  should be reviewed onsite and what program operations should be  covered during onsite visits; two states provided sample forms or  instructions on what forms to use to record findings. For example, each  state’s policies and procedures established the frequency of onsite visits:  New York and Texas conduct the visits at least once every 3 years and  North Dakota conducts them once every 2 years (see table 2). The  selected states’ policies and procedures also specified that state officials  assess local agency financial controls, review financial records and client  files, and review local agency governance. They also described  information about actions state officials were required to take when they  identified deficiencies in a local agency’s operations. For example, in all  three of the states we visited the policies and procedures required state  officials to notify local agencies of deficiencies in writing.

Our findings from the two local agencies we visited in each of the three  states showed that state officials identified a variety of issues during their  reviews, but none that required those local agencies to lose their CSBG  funding (see table 3). Generally, we found that the issues identified could  be characterized as fiscal, governance, or administrative. Fiscal issues  included improper use of funds. For example, state officials in one  selected state found that a local agency had improperly used a small  amount of CSBG funds to purchase a grill for agency activities.  Governance-related findings included issues with both the composition  and manner of selecting the local agency’s CSBG Board of Directors  members. For example, in Texas, state officials cited one local agency for  not complying with the CSBG Act’s requirement regarding the structure of  its Board. Also, North Dakota cited a local agency for not having the  required representation of low-income individuals on its Board.  Administrative issues included recordkeeping of information on  participants. For example, Texas cited a local agency for inaccurately  reporting a program participant as having transitioned out of poverty. The  state agency found that the participant’s file did not contain all of the  required documentation needed to show that the participant had  maintained a certain income level for a 90-day period.

The state agency officials we spoke with told us that their reviews  sometimes identified more serious issues that resulted in local agencies  being terminated from the program. For example, Texas terminated two  local agencies’ CSBG funding due to financial mismanagement that was  uncovered during state monitoring of the local agencies. Texas officials  noted that the process for terminating local agencies with deficiencies  was, for them, a prolonged process, in part because of the steps they  took to provide technical assistance and work with agencies in an attempt  to resolve issues before terminating them from the program. They told us  they found it difficult to establish sufficient grounds for termination and, for  one of the terminations, Texas officials continued to work with the agency  for two years while also working with OCS. Texas officials told us that  they found the guidance on terminations to be unclear. OCS officials  acknowledged that the information memorandum they have developed on  terminations provides broad guidance that covers a range of issues states  might encounter, and may not have detailed guidance covering each  situation. However, they noted that they work with states on a case by  case basis, as they did with Texas, to provide guidance that is specific to  each situation.

State officials in the selected states told us that local agencies identified  as having deficiencies are notified of those deficiencies and provided  information on how to correct them. Further, our review of corrective  actions required of selected local agencies by the states we visited  showed that the local agencies addressed the concerns raised by the  states. For example, Texas required a local agency that it found did not  comply with CSBG Board requirements concerning membership to fill the  vacancies on the Board and to provide the state a timeline for completing  the required corrective actions. In addition to taking corrective actions,  local agencies may be required to submit fiscal and programmatic reports  more frequently when monitoring uncovers problems. For example, North  Dakota’s policies and procedures indicate that monthly reports may be  required of local agencies that have been found to have financial  recordkeeping problems.

We also found that state agency officials in our three selected states  conducted onsite reviews more frequently than the once every 3 years  requirement, as well as routine offsite reviews. For example, New York  conducted quarterly onsite visits to all local agencies, where each  quarterly visit involved a targeted review of a specific aspect of a local  agency’s CSBG program. For example, during the third quarterly visit of  the year, state officials focused on local agency planning efforts for the  next funding year, including the community needs assessment, while  during the last quarterly visit of the year, state officials focused on grant  closeout activities. New York, like North Dakota and Texas, also  conducted routine offsite reviews of local agencies’ activities and  finances. In our three selected states, these reviews included examining  fiscal and program reports periodically submitted by local agencies to  state officials, periodic meetings and conference calls between state and  local agency staff, and reviewing audit reports. These oversight activities  also included fiscal audits conducted by the state auditor or independent  auditors when a local agency’s funding met the threshold for such review.

Our review of single audits and interviews with each state’s auditor’s  office in the three states we visited showed that none of the state audit  agencies focused specifically on CSBG funding during the period of our  review. Texas last conducted an audit focusing on CSBG in 2014 and  North Dakota did so in 2011; neither state reported findings as a result of  those audits. Officials from the state auditor offices in North Dakota and  Texas said CSBG funding levels are below the federally-established  threshold for programs that must be audited. New York state audit  officials told us that they had not conducted any audits focused on CSBG.

OCS and States Provided Training and Technical Assistance to CSBG Recipients

OCS and states provided training and technical assistance through a  variety of methods to help CSBG recipients meet program requirements.  In fiscal years 2016 and 2017, OCS designated nearly $14 million over  the 2-year period for such efforts. OCS officials told us that they  determine what training is needed through input from OCS program  specialists, information obtained through a data task force, and requests  from state and local agencies. OCS officials stated that the OCS’s  program specialists use the quarterly calls to identify the types of support  that states need. For example, a specialist may notice that the states  need additional guidance on using their customer survey results. In  response, the specialist may share a guide on how states can use the  survey results to set reasonable performance improvement goals. In  addition, OCS sponsors a CSBG Data Task Force to recommend  strategies for building network capacity for collecting, analyzing, reporting  and using performance data as well as identifying on-going training and  technical assistance needs. OCS officials told us that they also  conducted focus groups in 2016 to gather states’ perspectives on their  training and technical assistance needs. From these focus groups, OCS  issued guidance stating its technical assistance priorities and strategy for  meeting identified needs for training and technical assistance in areas  including: performance management, governance, effective state  oversight, and results-oriented services and strategies.

In 2017, OCS issued guidance laying out the agency’s 3-year training and  technical assistance strategy to guide the development and delivery of  training and technical assistance for the CSBG network. OCS officials  said that once they establish the standards for the training and technical  assistance and identify specific training needs, the agency awards  cooperative agreements to organizations that focus on developing and  providing training to build upon guidance already provided. During the  period of our review, we found that each agreement focused on a specific  type of training. For example, the National Association for State  Community Services Programs (NASCSP) has a cooperative agreement  with OCS to provide the orientation and oversight training for new state  officials overseeing the CSBG program, and collects and coordinates the  analysis of the data provided in the state plans and annual reports. OCS  has also worked closely with NASCSP in the transition to the new  performance framework. OCS officials told us that they are currently  reviewing their training and technical assistance portfolio and may issue  additional guidance on its strategy and coordination efforts during fiscal  year 2020.

In addition, OCS uses various methods to provide guidance to states to  help them meet CSBG requirements, but state officials differed in their  views on the usefulness of the guidance. OCS provides guidance to  states through informational memorandums, letters, webinars, and  communications with program specialists. Some of the state agency  officials in two of the states we visited said that the guidance that OCS  has provided to help states ensure compliance with program  requirements is not always clear and up to date. For example, officials in  North Dakota said that they did not understand the information  requirements for a form used to gather information from applicants for  local programs. State agency officials in Texas said that OCS issued  guidance on the new information requirements just weeks before the  reporting deadline, and that this did not allow states sufficient time to set  up their data systems to meet the new requirements.

OCS officials acknowledged that they were aware of the issues raised by  state agency officials and explained that some states have difficulty with  the guidance because it is written at a high level so that it can apply to all  states. They also acknowledged the delays in getting new information  requirements to states and said that such delays were related to  troubleshooting the new smart forms and online database. They said that  they do not anticipate such delays in the future. As previously discussed,  Texas state officials also said that they found the guidance for terminating  a deficient agency’s CSBG funding confusing. However, officials in New  York said that they found the guidance to be clear. They said that the  informational memorandum on terminating agencies’ CSBG funding is  more prescriptive than previously issued CSBG guidance. OCS officials  stated that the agency is continuously seeking opportunities to work with  its technical assistance centers to identify the best means of delivering  guidance to states and to eligible entities. OCS officials also said that they  must continue to refresh training efforts when there is turnover among key  staff in a state agency and work with new state administrators to transition  into their new roles.

State agency officials in all three states we visited told us that they used  some of their state’s discretionary funding for training and technical  assistance to help local agencies meet CSBG requirements. The CSBG  Act allows states to use a maximum of 10 percent of their CSBG funds for  training and technical assistance and other specified purposes. In the  selected states, officials spent from $65,000 to over $400,000 for training  and technical assistance for local agencies (see table 4).

Across the three selected states, we found that the training provided to  local agencies addressed what local agencies need to do to meet a wide  variety of CSBG requirements, from planning community needs  assessments to implementing performance management requirements. In  addition, some funds states provided for training were used by local  agencies to send their staff to regional or national conferences for training  (see table 5).

State officials in two of the three states we visited said that they  determine what training they need to offer based on analysis of feedback  and specific requests from local agencies. For example, Texas identified  training needs for local agencies through a Training and Community  Affairs group that gathered information from local agencies about their  training needs. Texas officials said they analyzed assessment results,  feedback, and requests from local agencies and other sources to  determine the training needs of individual state and local agencies. State  officials said that they then met with the state association to develop the  Joint State Training and Technical Assistance Plan and, ultimately, to  provide trainings at the annual state conference, and to identify  workshops, webinars, and online resources (guides, tools, best practices,  and links to other training resources) that need to be added or changed.  Similarly, state officials in North Dakota reported working closely with the  state association of community action agencies to plan and conduct  training for local agency staff.

State and local agency officials also said that they have relied on the  OCS-funded national resource centers for assistance. Officials in the  states we visited all reported being helped by information provided by the  national centers on topics such as the new organizational standards and  how to submit data in the new annual report. Local agency officials told us  that they send staff to the conferences sponsored by the national  resource centers to obtain training when funding is available for that  purpose.

In addition to training, state officials in the states we visited cited a variety  of practices that contribute to effective oversight. Both New York and  North Dakota officials emphasized the importance of frequent, ongoing  communication with local agencies as crucial to successful oversight.  New York also identified frequent visits to local agencies and immediate  action in response to problems as additional key factors for effective  oversight.

OCS Reports on CSBG’s National Effectiveness, but Several Elements of Its Redesigned Performance Management Approach Do Not Align with Leading Practices

OCS Uses State Outcome Data to Report on the National Effectiveness of CSBG, but the Performance Measure Used for this Purpose is of Limited Use

OCS uses outcome data from state agencies that collect and aggregate  data from local CSBG recipients to provide an indication of CSBG’s  progress in meeting the three national program goals. As previously  discussed, the three national goals of the CSBG program as established  under the CSBG Act are to (1) reduce poverty, (2) empower low-income  families and individuals to become self-sufficient, and (3) revitalize low- income communities. State agencies report data from a menu of more  than 100 performance measures established by OCS and grouped by  service types such as employment, early childhood programs, and  education. OCS sets annual targets for the overall performance of the  CSBG program and uses the aggregated state data as an indicator of  CSBG’s national effectiveness to inform budget decisions consistent with  federal requirements for performance management.

Until fiscal year 2018, OCS used one performance measure—the number  of barriers to economic security that the local agencies receiving CSBG  funds eliminated for individuals, families, and communities—to provide an  indication of CSBG’s national effectiveness. To do this, OCS combined  the outcome data from 10 of the more than 100 performance measures  from the state annual reports to derive a cumulative total number of  barriers overcome. OCS selected the 10 measures as a way to track  outcomes from services that range from emergency services to more  comprehensive and coordinated services. The 10 measures included  outcomes such as the number of participants who obtained a job,  maintained employment, maintained an independent living situation,  reached the goals of enrichment programs, or obtained emergency  assistance.

While this one performance measure of barriers eliminated was intended  to provide OCS with an indication of how the program was meeting CSBG  national goals, several weaknesses with this measure limited OCS’s  ability to do so. First, the measure included duplicative counts. For  example, an individual may overcome a number of different barriers to  reach the outcome of obtaining a job. As a result, by tracking the number  of barriers, an outcome may be counted multiple times when combining  data from multiple measures. Second, it is also difficult to know which  CSBG funded program or service caused the positive outcome or if one  service helped achieve multiple outcomes. Third, OCS officials clarified  that when calculating this and other outcome measures, the removal of  barriers to economic security is not solely the result of CSBG funds, but of  all funding administered to local agencies that received CSBG funds. As  such, they said that it is difficult to isolate the effects of CSBG funding.

In its agency wide budget justification for fiscal year 2020, HHS reported  that in fiscal year 2017 local agencies eliminated 32.2 million barriers to  economic security, well above the 27.6 million it set as its goal for the  year. In the same year, 16.2 million individuals received support through  local agencies receiving CSBG funds. While the performance measure  aided OCS in providing some indication of how the CSBG program  contributes to the goal of improving self-sufficiency, it still did not provide  information on the program’s progress in meeting the other two national  program goals. Leading practices in performance management stress  that performance measures should be tied to the specific goals of the  program. However, no such linkage existed between the performance  measure OCS used to report on the progress of the CSBG program and  the program’s three national goals. required to annually report, among other things, a summary of certain  information the states provide and its findings on state compliance to  Congress. While OCS does submit such reports, we found that there has  historically been a multi-year lag in OCS providing these reports to  Congress. In May of 2019, OCS released its fiscal year 2015 CSBG  report to Congress (see sidebar on data reported in the CSBG fiscal year  2015 report to Congress). Over the last decade, this type of reporting lag  has been common and OCS has taken an average of more than 3 years  from the end of the federal fiscal year until the time the Congress  received the final report. OCS officials told us that they submitted the draft  annual report for fiscal year 2016 for internal review by HHS in October  2018, but said that they could not project when the final report would be  issued to Congress. They said they are currently drafting the fiscal year  2017 report.

Several Elements of OCS’s Redesigned Performance Management Approach Do Not Align with Federal Leading Practices, Limiting OCS’s Ability to Report on CSBG’s National Progress

OCS has taken steps to redesign its performance management approach,  but several elements of the new approach do not align with federal  performance management and internal control standards. OCS has been  redesigning how it oversees and manages the performance of the CSBG  program to better align with GPRAMA, according to OCS officials. Since  fiscal year 2016, OCS has been implementing new performance  management tools for the CSBG program, including updating what data it  collects and how it collects it on the services and outcomes, or  performance measures, of the CSBG program. OCS officials stated that  the changes are necessary to be able to provide more information and  analysis on CSBG funded programs and their outcomes. They also noted  the importance of these updates given a tightening federal budget. As  part of these changes, OCS updated its more than 100 performance  measures by revising the language of some and adding new measures  that state and local agencies can report on, including measures more  focused on outcomes in the communities they serve. State and local  agency officials told us that the increased emphasis on outcomes in the  new measures was an improvement and increased their own focus on  connecting CSBG funds to traceable results. In addition, OCS  transitioned to an online data reporting system that allows state agencies  to directly report and access CSBG program data. However, OCS is still  revising how it will use the data provided by state and local agencies to  reflect nationwide results.

OCS is using the data collected in state annual reports to develop a new  national measure intended to provide a national total count of individuals  who achieve at least one positive outcome through programs and  services offered by local agencies that receive CSBG funds. Unlike the  prior measure on the number of barriers to economic security eliminated  by local CSBG recipients that could include duplicative counts, the new  measure will be a count of individuals. OCS stopped using the prior  measure after fiscal year 2017. Until OCS finalizes the new measure, it  does not have a performance measure in place with targets and results  that it can report to Congress. As such, it is unclear if OCS will report  national performance outcomes for fiscal year 2018 or how useful the  new measure will be while it is still in development through fiscal year  2022.

While OCS has taken steps to redesign its performance management  approach, several elements of the new approach do not align with federal  performance management and internal control standards. Specifically,  OCS has not established (1) how the new national measure will be used  to assess CSBG goals, (2) the relationship between state and local  measures and program goals, and (3) how OCS will monitor the reliability  of state and local agencies’ program data.

How the newly developed national measure will assess CSBG  program goals. As discussed, OCS is developing a new national  measure intended to provide a total number of individuals who achieved  at least one positive outcome from CSBG funded program or services.  However, it is unclear which of the three program goals—reducing  poverty, empowering low-income families and individuals to become self- sufficient, or revitalizing low-income communities—the new national  measure is being used to assess. As noted previously, OCS officials have  stated that they are working to establish ways to provide more information  and analysis on programs and their outcomes. OCS officials also told us  that they are using GPRAMA as a guide for these changes and in our  prior work we have reported that these requirements can serve as leading  practices for strategic planning at lower levels within federal agencies.  GPRAMA requires agencies to establish performance goals and a  balanced set of performance indicators, including output and outcome  indicators as appropriate, in measuring or assessing progress toward  those goals. Additional leading performance management practices state  that performance measures should be tied to the specific goals of the  program. However, OCS’s new measure which is intended to provide a  count of the number of individuals that achieve one or more positive  outcomes does not specify which of the three national program goals the  new measure will address, nor how the other two national program goals  will be addressed. OCS officials told us that the new measure is related to  two of the three goals because it is aggregated data from some of the  outcome measures focused on individual and family outcomes. However,  officials acknowledged that the agency has not yet developed a national  measure for revitalizing low-income communities. Officials stated they  plan to report on progress toward developing these measures and that it  will provide examples of community-level outcomes in upcoming reports  to Congress. Without clearly linking the measure to the goals, there is no  way to tell if, and to what degree, the services local agencies are  providing through CSBG grant funds are having the desired effect on their  communities, even if examples are included in the shared results.

How state and local performance measures are related to the three  program goals. It is unclear how the large number of updated state and  local performance measures under OCS’s redesigned approach aligns  with CSBG’s three national program goals. OCS still collects data on  more than 100 measures but it is unclear which of these measures will be  analyzed at a national level. According to OCS officials, these data are  most useful to state and local agencies for assessing outcomes against  their unique goals and numerous measures are necessary to capture the  variety of services and outcomes across the 1,000 local agencies. In our  prior work on ways that agencies could improve performance  management, we have stated that using a minimal number of critical  measures is a leading practice. We have found that organizations that  seek to manage an excessive number of performance measures may risk creating confusing, excess data that will obscure rather than clarify  performance issues. The large number of measures can also further  complicate OCS’s efforts to align the measures with CSBG’s three  national program goals.

How OCS will assess data reliability long-term. Although OCS is  taking steps to assess data collected from state and local agencies for its  new national measure, it does not have a written plan for how it will  assess the data’s reliability for future years. As previously discussed,  OCS is using a new data reporting system to collect the data it will  subsequently use for its new national measure and this data will now be  received directly by OCS instead of a third party. However, OCS does not  have written plans in place for how the agency will determine if the new  data collected will be a valid measure of the national program’s  effectiveness or if the data will be reported reliably by the states into  OCS’s online data system. OCS received its first round of performance  data for the new measure for fiscal year 2018 on April 30, 2019, and is  working with its cooperative agreement grantees and contactors to  compile results and conduct quality assurance tests for the new  performance data using a multi-step process that involves:

OCS staff comparing data provided in the annual report to information  previously provided in the state plans;

OCS conducting quality assurance reviews, with assistance from the  organizations the office has cooperative agreements with, that include  checks for discrepancies and identifying items requiring clarification,  and conducting follow-up with the states; and,

OCS soliciting feedback from state officials and consulting with  performance management experts within HHS about refinements to  assist OCS in establishing a baseline that will be used in setting future  targets.

OCS officials also told us that the next steps will be to make any  necessary modifications to the measure, such as adjusting how states  calculate positive outcomes, and establishing a baseline to set future  targets. On October 2, 2019, OCS announced via a Federal Register  Notice that it was requesting a three year extension with minor changes  of the CSBG Annual Report. OCS plans to make only minor changes to  the current data collection tool for 2 years to allow state and local  agencies time to assess current information and intends to begin a longer  term planning process starting in fiscal year 2020. OCS officials told us  that they plan to implement and maintain a quality assurance process to  ensure the accuracy of the data based on data from previous years.

While the process OCS has put in place to ensure data reliability for the  first round of data collected for the new measure is a step in the right  direction, OCS does not have a plan for assessing future years’ data.  OCS officials told us that they will use selected cooperative agreements  and contracts to develop a written plan for how the agency will monitor  state and local agency data reliability going forward, but did not provide a  timeframe for when this would be completed. Leading practices  established by federal internal control standards state that agencies  should use quality information that is appropriate, current, complete, and  accurate to make informed decisions and evaluate the entity’s  performance in achieving key objectives. OCS officials reported that they  and contractors are working with the states to adjust and finalize data for  fiscal year 2018 by November 2019.

By not aligning its redesigned performance management approach with  federal performance management leading practices related to program  goals, performance measures, and data reliability, OCS cannot properly  assess its progress in meeting CSBG’s three national goals.

Poverty erodes the well-being of individuals, families, and communities.  The CSBG program is intended to reduce poverty, empower low-income  individuals and families to become self-sufficient, and revitalize low- income communities. The CSBG program allows local agencies to use  funds in a wide variety of ways to reduce the causes of poverty in the  communities they serve. However, the inherent flexibility of the program  also makes it difficult to assess the program’s performance.

OCS recently redesigned its performance management approach to  better understand how well the CSBG program is progressing toward  meeting national goals. However, several elements of the redesigned  approach do not align with leading practices in federal performance  management. Inconsistencies with these practices, such as having an  excessive number of performance measures and lacking a plan for  assessing the reliability of state and local performance outcome data, limit  OCS’s ability to demonstrate the national effectiveness of the CSBG  program. As such, OCS cannot assure the Congress and the American  public that the funding is meeting its intended purpose to reduce the  causes of poverty.

The Director of OCS, in developing the new performance management  approach for the CSBG program, should ensure that its performance  framework includes information on (1) details for how the national  measure is linked to and used to assess the three national program  goals, (2) descriptions of how the updated state and local performance  outcome measures align with national program goals, and (3) a written  plan for how OCS will assess the reliability of state performance outcome  data. (Recommendation 1)

We provided a draft of this report to HHS for review and comment. We  received written comments from HHS, which are reprinted in appendix III.  HHS concurred with our recommendation, and stated that it plans to take  actions to better align its performance measures with the three national  performance goals outlined in the new CSBG Theory of Change. While  we commend HHS for its plans to address our recommendation, we urge  HHS to focus on aligning its performance outcomes with the three  national goals of the CSBG program as established by the CBBG Act,  which are similar but not identical to the three goals outlined in the new  CSBG Theory of Change. HHS also stated that it would implement  additional actions to assess the reliability of state performance outcome  data. In addition, HHS provided technical comments which we  incorporated as appropriate.

As agreed with your office, unless you publicly announce the contents of  this report earlier, we plan no further distribution until 30 days from the  report date. At that time, we will send copies to the appropriate  congressional committees and the Secretary of HHS. In addition, the  report is available at no charge on the GAO website at  https://www.gao.gov.

If you or your staff have any questions about this report, please contact  me at (202) 512-7215 or larink@gao.gov. Contact points for our Offices of  Congressional Relations and Public Affairs may be found on the last page  of this report. GAO staff that made key contributions to this report is listed  in appendix IV.

Appendix I: Objective, Scope, and Methodology

This appendix discusses in detail our methodology for addressing our two  research objectives examining (1) the activities that the Department of  Health and Human Services (HHS) and states conduct to oversee the  state and local agencies that receive Community Services Block Grant  (CSBG) funds and (2) the extent to which HHS assesses the outcomes of  the CSBG program. We scoped our review of the CSBG program to  include the 50 states, American Samoa, the District of Columbia, Guam,  Northern Mariana Islands, Puerto Rico, and the United States Virgin  Islands, which are defined as states under the CSBG Act.

In addition to the methods we discuss below, to address both our  research objectives, we reviewed relevant federal laws, federal grants  management guidance, and agency documents that describe the federal  requirements and responsibilities for overseeing states’ CSBG programs  and assessing program outcomes. We interviewed HHS, Office of  Community Services (OCS) officials; and reviewed relevant research from  OCS and the HHS Office of Inspector General, as well as our prior work  on the CSBG and other federal grant programs. Further, we interviewed  representatives of the National Association for State Community Service  Programs (NASCSP); state officials from state agencies that oversee the  CSBG program in New York, North Dakota, and Texas; and six local  agencies that receive CSBG funds. We also analyzed CSBG annual  reports to Congress and NASCSP data on local agency allocations.

To address the federal oversight aspect of our first objective, we reviewed  available information on OCS’s policies and procedures, including the risk  assessment criteria OCS uses to select states for onsite compliance  evaluations and interviewed OCS officials about their oversight efforts.  We also selected 12 states for an in-depth review of OCS’s oversight  activities. These included six states (Indiana, Louisiana, Michigan, New  York, North Carolina, and Texas) for which OCS conducted onsite  compliance evaluations during fiscal years 2016 and 2017. We selected  the six states where OCS had conducted onsite compliance evaluations  based on which of the visited states OCS had prioritized as those in  highest need of onsite reviews for fiscal years 2016 and 2017. We also  randomly selected five states (Alaska, Colorado, Kentucky, Mississippi,  and Rhode Island) where OCS did not conduct such evaluations, but  conducted routine reviews. We also selected a sixth state—North  Dakota—because OCS had not visited the state in several years. We  compared the results to see if there were any notable differences  between the two sets. While our findings are non-generalizable, they  provide insight into the different levels of review OCS conducts and  examples of OCS oversight actions.

Our file documentation reviews included a review of: OCS’s comments on  each section of the states’ program documents, including the state plan  and annual reports; actions the states took to address OCS’s comments;  and state’s fiscal controls, financial and program oversight documents.  Table 6 provides a summary of the characteristics of the 12 states we  selected for review.

State and Local Oversight of the CSBG Program

To address the state and local oversight aspect of objective one, for a  more in-depth look at state oversight practices, including promising  practices and challenges, we visited three states: two states (New York  and Texas) for which OCS conducted onsite compliance evaluations and  one (North Dakota) for which OCS conducted a routine review. We  selected these states using several criteria, including state grant  amounts, number of local agencies, whether the HHS Office of Inspector  General findings had reviewed the state’s use of CSBG funds, the time  since the state was last visited by OCS for a compliance evaluation visit,  and recommendations from experts at NASCSP and at OCS, who based  their recommendations, in part, on states that had promising practices for  overseeing local agencies (see table 7). Our final state selections  comprise a diverse sample based on these criteria. For example, our  selected states include a state with a low number of local agencies, one  with a large number of local agencies, states with high and medium  amounts of funding, and a state with a low amount of funding.

During our state site visits, we interviewed and collected information from  state and local agency officials about state oversight efforts from fiscal  years 2016 through 2017. For each of the three states, we interviewed  state program officials and reviewed related documentation including  state policies and procedures, state single audits, onsite oversight guides  and reports, and reporting forms for local agencies. We also visited two  local agencies in each state and interviewed staff to learn more about  state oversight efforts, including fiscal and performance reporting, onsite  visits, training and technical assistance, and promising practices and  challenges to such oversight. We conducted these visits in November and  December 2018. In each state we visited, we reviewed program files for  the two local agencies we visited, including oversight, financial, and  performance reports; and follow up correspondence concerning the  findings from state agency visits to those local agencies. Information  collected from state and local agency officials during our site visits are not  generalizable to all state CSBG programs.

In addition, we obtained information on state audit findings related to  CSBG and met with state auditors during site visits to learn more about  additional state oversight of CSBG and local agencies to learn whether  any coordination occurred between the different federally funded  programs offered by the local agencies to support state oversight efforts.  We reviewed the Single State Audit findings for fiscal years 2016 through  2017 for each of three states and six local agencies we visited. We  reviewed these audit reports to determine if there were findings pertaining  to CSBG and if so, the nature of those findings.

Assessment of Program Performance for the CSBG Program

To address our second objective, we reviewed the program performance  indicators OCS uses to measure program outcomes in relation to the  stated goals of the CSBG program. We also reviewed OCS’s design and  implementation plans for a new performance management approach,  including revised performance measures for assessing program  outcomes. We compared OCS’s previous performance management  approach to its new one, including the types of data it collected and its  methods of collecting data from state and local agencies. In conducting  our work, we also interviewed OCS officials about the goal of, and  changes to, the performance management approach and reporting  requirements. Additionally, we interviewed state officials on their  experience with CSBG program performance. We reviewed leading  practices in grant performance management identified in federal guidance  and in GAO reports and assessed OCS’s approach against federal  performance and internal control standards.

We conducted this performance audit from to May 2018 to November  2019 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.

Appendix II: Table of Federal Community Services Block Grant (CSBG) Allocations to States, Fiscal Years (FY) 2016 through 2019

Total Allocations for States Included in GAO’s Review

This table includes all states as defined by the CSBG Act, which was the focus of our review.

Appendix III: Comments from the Department of Health and Human Services

Appendix IV: GAO Contact and Staff Acknowledgments

In addition to the contact named above, Mary Crenshaw (Assistant  Director), Melissa Jaynes (Analyst-In-Charge), Sandra Baxter and Stacy  Spence made key contributions to this report. Also contributing to this  report were James Bennett, Grace Cho, Alex Galuten, Danielle Giese,  Corinna Nicolaou, Monica Savoy, and Almeta Spencer.

HHS oversees the federal Community Services Block Grant program, which provides about $700 million in grants to states. In turn, the states provide funding to and oversee more than 1,000 local agencies. These agencies offer a range of services to address the program’s three goals: reducing poverty, promoting self-sufficiency, and revitalizing low-income communities.

Although HHS uses state data for insight into the program’s performance, it doesn’t clearly tie the data to the program’s three goals.

We recommended HHS provide information on how data collected from the states aligns with program goals in its new performance management plan.