U.S. Department of Labor
Office of Inspector General

Audit Report

WtW COMPETITIVE GRANT PROGRAM IMPLEMENTATION PROGRESS AS OF MARCH 31, 1999
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Report Title:  WtW Competitive Grant Program Implementation Progress as of March 31, 1999

Report Number:  03-99-017-03-386

Issue Date:     September 27, 1999
 

The Balanced Budget Act of 1997 authorized the Secretary of Labor to provide WtW grants to states and local communities to move hard-to-employ recipients of Temporary Assistance to Needy Families (TANF) into lasting unsubsidized employment and economic self-sufficiency. The Act authorized $3 billion for WtW grants in Fiscal Years 1998 and 1999. The Department of Labor, Employment and Training Administration (ETA) is awarding $711.5 million to selected Private Industry Councils (PICs), political subdivisions, or private entities through the WtW Competitive Grants Program. The competitive grants are designed to develop and implement creative and innovative approaches to enhance a community's ability to achieve WtW program goals. At least 70 percent of WtW funds must be spent on hard-to-employ individuals, and the remainder on individuals with characteristics of long-term welfare dependency.

The Office of Inspector General (OIG) performed an audit to assess implementation by the first-round grantees as of March 31, 1999. The audit of 19 grants (totaling $84 million) of the 51 grants awarded found that all grantees experienced delays in implementing their programs.

Because the WtW competitive grant program was an entirely new concept, the organizations competing for the first round of competitive grant awards were asked to develop program plans without the benefit of prior experience. We found that many of the program plans included in the approved grant agreements lacked quarterly goals against which to measure performance.  At the time of our audit of the 19 grantees:
 

  • of the 15 that had quarterly plans for participants served, only four were meeting their planned levels;

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  • of the eight that had quarterly plans for participants placed in unsubsidized employment, none were meeting their planned levels; and

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  • of the 16 that had quarterly plans for expenditures, only one was meeting its planned level.

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    Also, 13 of the 19 grantees (68 percent) stated that they were not getting enough referrals of eligible individuals meeting the 70 percent criteria. Ten of the 13 grantees stated that the eligibility criteria restricting individuals who have completed secondary school or earned a certificate of general equivalency, was too strict.

    However, nine grantees identified the following factors which contributed to their early success. Seven stressed the importance of establishing strong relationships with employers. Six of the 9 grantees took the initiative to develop strong cooperative relationships or joint efforts with their local TANF offices. The other three grantees administered the WtW Competitive Grant, WtW Formula Grant and local TANF programs under one organizational umbrella.

    Agency Comments:  ETA stated that, in instances where round-one grantees have shown little progress or lack of operation, the Department of Labor and representatives from the Rutgers University John J. Heldrich Center for Workforce Development made site visits. The visits resulted in grant modifications necessary to speed implementation, and in some instances, the mutually agreed upon deobligation of a portion of grant funds for use in funding round-three competitive grants. In addition, the Department of Labor has been working with the Congress to simplify the WtW eligibility criteria mandated by the authorizing statute and to extend the length of the program. This would significantly accelerate expenditures and enrollments.

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