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New Law Will Increase Fiscal Oversight, Saving Taxpayers Millions

by Nan Swift / /

Last week, President Obama signed the Grants Oversight and New Efficiency (GONE) Act into law. The GONE Act will require agencies to close out all expired grant accounts, saving taxpayers hundreds of thousands of dollars a year in service fees on accounts with zero dollar balances and hundreds of MILLIONS in undisbursed funds. The bill was championed by bipartisan teams: Senators Deb Fischer (R-NE) and Joe Manchin (D-WV) in the Senate, and Representatives Tim Walberg (R-MI) and Brenda Lawrence (D-MI) in the House.

The Government Accountability Office (GAO) shed light on these forgotten accounts in a 2012 report:

At the end of fiscal year 2011, GAO identified more than $794 million in funding remaining in expired grant accounts – accounts that were more than 3 months past the grant end date and had no activity for 9 months or more – in the Payment Management System (PMS). GAO found that undisbursed balances remained in some accounts several years past their expiration date: $110.9 million in undisbursed funding remained unspent more than 5 years past the grant end date, including $9.5 million that remained unspent for 10 years or more.

In addition, according to the GAO, taxpayers lost money when agencies neglected to promptly close out accounts after the grant end date. GAO identified more than 28,000 expired grant accounts with zero dollar balances, for which taxpayers were charged about $173,000 a month.

GAO has repeatedly advised that agencies better track grants to prevent this kind of waste, but the problem has persisted; making necessary a legislative solution and more Congressional oversight. Key reporting requirements in the GONE Act should bring increased accountability, ensuring that expired accounts are finally closed and reducing this problem going forward.

The Congressional Budget Office reported last month that deficits will once again climb in 2016, making it all the more urgent that legislators seek out all opportunities to reduce wasteful spending and better steward finite taxpayer dollars. The GONE Act is a good example of the kind of commonsense, bipartisan, money-saving solutions taxpayers need to see more of.