Today, the U.S. Senate Committee on Homeland Security and Governmental Affairs held a hearing entitled "Follow the Money: Transparency and Accountability for Recovery and Reinvestment Spending." The hearing focused on how the relevant federal agencies would handle oversight of the management and spending of funds allocated under the American Recovery and Reinvestment Act of 2009 (ARRA). Testifying before the Committee were the following witnesses:

  • Robert L. Nabors II, Deputy Director, Office of Management and Budget (OMB)
  • Gene L. Dodaro, Acting Comptroller General, U.S. Government Accountability Office (GAO)
  • Phyllis K. Fong, Inspector General, U.S. Department of Agriculture and Chair, Council of the Inspectors General on Integrity and Efficiency

Mr. Nabors stated that OMB is "[f]ocusing on ensuring that the federal agencies tasked with managing recovery money are executing their mandates well" and is preparing guidance for all federal agencies on how to manage ARRA dollars in a way that will promote "transparency and efficiency." In particular, the OMB guidance will call on agencies to "[g]o beyond standard operating procedure and recognize the unusual nature of recovery funds," and ensure that ARRA funds are "[d]istinguished from other funding in their financial systems, grant and contract writing systems, and reporting systems." OMB has requested that those federal agencies receiving ARRA funds provide OMB with monthly financial reports and detailed data submissions on award transactions, in addition to publicly available "spending plans" detailing critical areas of program implementation, including, among other items, funding amounts and timeframes, key milestones and deadlines, program objectives and goals, and measurements to ensure accountability for results.

Mr. Dodaro reported that GAO has already begun the work of meeting its responsibilities under ARRA. GAO has "[r]eached out to the broader accountability community," which includes Inspectors Generals, state auditors, and local government auditors as well as the Chair of the Recovery Accountability and Transparency Board (the Board was created pursuant to Section 1521 of ARRA to help prevent waste, fraud, and abuse), "[t]o start coordinating our respective roles, planned approaches, and timelines." As part of its responsibilities under ARRA, GAO will conduct bimonthly reviews of selected states and localities to examine how ARRA funds are being used and whether they are achieving the stated purposes of the act, as well as coordinate with OMB on, among other things, reporting requirements and guidance to ARRA fund recipients and on what information is to be collected in order to adequately evaluate how well the ARRA achieves its objectives.

Finally, Ms. Fong assured the Committee that "[t]he Inspector Generals at the federal agencies that are receiving ARRA funds are actively engaged in planning to meet their responsibilities." This responsibilities will include reviewing any concerns raised by the public about specific investments of ARRA funds, examining records and interviewing the employees of entities that receive ARRA funds, and timely performing whistleblower investigations when presented with allegations of evidence of gross mismanagement, waste, or illegality related to ARRA expenditures. Ms. Fong also stated that the Stimulus Working Group, created by the Council of Inspectors General on Integrity and Efficiency (Council), can serve as a forum for Inspector Generals directly responsible for ARRA stimulus oversight to "discuss and share strategies, best practices, and other proactive measures to provide rigorous oversight of stimulus activities."