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Audit (A-02-07-02008)

03-17-2009
Review of Health Resources and Services Administration Grant Closeout Procedures

Executive Summary

We found that the 3,184 Health Resources and Services Administration (HRSA) grants identified by the HHS Division of Payment Management (DPM) as eligible for closeout as of December 31, 2006, which had unexpended balances totaling more than $173 million, remained open in the payment system for several reasons. DPM is responsible for closing grants after receiving instructions from the Administration for Children and Families or the HHS Division of Financial Operations. HRSA is responsible for initiating closeout of grants. As a general rule, grants must be closed within 180 days after the end of the grant period (the cutoff date). However, the grants remained open after the cutoff dates because of staffing shortages; differences among the grant award, expenditure, and drawdown amounts in the payment system; or a lack of grant closeout procedures. Also, HRSA and the Division of Financial Operations did not adhere to or lacked follow-up procedures to determine whether DPM had actually closed grants for which closeout was initiated.

We recommended that HRSA use the information in this report to ensure that grants are closed in a timely manner and to eliminate the backlog of grants eligible for closeout. In its comments on our draft report, HRSA described actions that it had taken or planned to take to implement our recommendation.

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