Do federal grants need tweaking for better results?

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The federal government spends more on grants each year than it does on procurement. Yet procurement seems to get the constant reform attention. Now a detailed study from the IBM Center for the Business of Government offers a detailed plan for how the government might get better outcomes from the grants it gives. The study’s author Shelley Metzenbaum joined Federal Drive with Tom Temin for more details.

Interview transcript:

Tom Temin: Shelley, good to have you back.

Shelley Metzenbaum: Tom, it’s great to be back with you.

Tom Temin: And we should point out it has been an abiding interest of yours. You’re not just somebody that wrote a paper, you did grants work for a while at the EPA some years back, and you’ve also written on this topic prior to this?

Shelley Metzenbaum: That’s correct. When I was at EPA, I headed up regional operations and state local relations and the federal government, whether you’re talking about EPA, or Headstart, or highways, or traffic safety, or even research and development, the federal government uses grants as a primary tool to accomplish its objectives. So being smart about how we manage those grants, really makes a difference.

Tom Temin: And every agency practically does grants, I think it’s the most common activity across every agency, isn’t it?

Shelley Metzenbaum: So the answer is, I can’t exactly tell you that. But I’m guessing you’re right. And USAspending.gov makes it much easier to see where the spending is going, what’s much harder to see is the impact of those grants. And yet, if you think about the research and development area, or clean air, or whatever, grants have made a huge difference. And we don’t have the ability not only to see that story and tell that story, so the public understands it better. So grant recipients can learn from it, we don’t have the ability to learn from the system, as well as we should.

Tom Temin: And your writing that the emphasis is on the process of getting grants out the door. And there’s a large apparatuses in agencies to do that. But the ability to measure the outcomes and know the outcomes and collect them, that’s what’s lacking?

Shelley Metzenbaum: Well, I’d actually say it’s not the ability to measure them, it is the focus on outcomes, and to get the data to figure out where to focus. And to get the data and other evidence, the findings of well designed trials to figure out how to improve outcomes. It really is having every grant program be more clear about what its outcome objectives are and making sure it has the data to find ways to improve.

Tom Temin: And so where do agencies fall short at this point? I mean, say in the spending that was related to the pandemic, a couple of big bills, much of that money, billions, hundreds of billions was for grants. And the emphasis seemed to be on speed. We need an answer to this, we need to understand that we need this vaccine, we need this shot, whatever it might be. But do you think the agencies granting that money? Did the necessary prior work, pre-homework if you will, to emphasize outcomes?

Shelley Metzenbaum: So let’s be realistic to expect the agencies to do the pre homework when they couldn’t necessarily No, this pandemic was going to hit when it did. It’s not fair to the agencies. So the question is, have we got a system put in place that helps them manage? Well. So if you look at the implementation of the recovery implementation office, they had a small unit of people who were really focused on how do we manage the grants, and part of that was getting the dollars out there. So it could get spent because you’re trying to stimulate the economy in that case, as opposed to what we’re dealing with with COVID. But part of it was some getting the money spent and then being able to say, over the long term, is this money doing what we hope it will do? Or do we need to move it to a different place. And one way of doing that was having frequent conversations with the grant recipients to understand their questions and get them the information they needed. And you can do that for every grant. The challenge is to organize that effort around the outcomes, first and foremost. So you need to actually be clear about what are our outcome objectives? And then who’s bringing people together? Who have the relevant data who have the relevant experience? And who are out in the field making the difference? How do you bring them together to sort of say, Okay, what have we learned? What do we need to do next? New technologies make this more possible than ever, we got to figure out how to tap those, both the analytics and the conversations and the networking for learning. So it’s a great opportunity. It’s a big challenge, but it’s real possible. So going back another real challenge in the system is that the oversight infrastructure tends to overwhelm the insight generating infrastructure, and between the GAO and the IGs, and even program monitoring. They use terms like, assess and track but for what purpose? I would argue it’s for three purposes, one, to figure out where to focus. Think about this with COVID, okay clearly, we had data that told us we needed to pay attention to COVID. But then within it, it was prevention. Okay, where are we on the vaccine, but also in terms of masks, it was response, how well are the treatments working? And then it’s also going to be economic recovery. So that’s very outcomes focus our oversight systems. In R&D, for example, where R&D researchers have done surveys a few times over the last 10 years, they found that 40% of their time is spent on administrative matters rather than on the program objectives that they’re trying to advance. That’s the system we need to fix.

Tom Temin: We’re speaking with Shelley Metzenbaum, author of the IBM Center for the Business of Government’s latest report on grants management. So that sounds like this is something that needs to be built in maybe to the front end, in the development of the grants idea and of the process, can the process, the redesign such that outcomes is much more front and center in the rest of what unwinds once you launch a grants program?

Shelley Metzenbaum: Yeah, I think that’s right. It’s at the front end and the back end, what do we learn from experience on the back end? So how do we collect data so we can learn from experience? And on the front end? How do we encourage the grant programs to be more clear about what their objectives are? why they chose those objectives. So there has been in the last few years some real progress, increased attention in this area, both from legislation that’s passed, and also from across agency priority goal on grants, where they’re making some progress. There is what used to be called the catalog of federal domestic assistance has been redesigned. Now beta.sam.gov. And, there’s a place when you’re putting out a grant application where you could say, Why are these the outcome objectives. So in the, I have an example in the report on improving grant transparency from the lead poisoning for children, that in the grant application, the notice at NOFO, it’s called notice a financial opportunity, they linked to the action plan for lead poisoning and children. And they provide the trend history, prior actions taken by government, where progress has been made, why they think it’s been made, maybe it’s the right reasons or not, it’s not a controlled study, but it looks pretty compelling, as well as what they plan to do next, which then helps the grant applicants think about, okay, how do I contribute? And you have the idea of the outcome broker would be something apparatus to be added to this whole thing. Is that a person? Is that a piece of technology? Is it a process, or I’m guessing it’s a combination of all of the above. So it is a term that I borrowed from the Government Accountability Office, the GAO report about the recovery implementation office, and where you had this very small office for all of the recovery work, that they were actually working with people in the agencies to be clear about what their outcome objectives are to figure out how they were going to measure progress. And it wasn’t only the outcome objectives, but the risks, the financial risks, etc. The recovery implementation office brought everybody together on a regular basis. Now, the Vice President was at the now the president, but Joe Biden was very involved in this at the time, deputy secretaries were involved at the time. And they came together on a very frequent basis, and then also had even more frequent calls with the field. That’s what I’m talking about. It doesn’t have to be as massive as the recovery implementation office. What’s fascinating to me, though, is that office was not funded, whereas the recovery accountability and transparency board, the RAC board was funded. Same thing happened on the most recent legislation. The second most recent, the first COVID, which was prac was funded, which was the IDs, but not an organization to manage. I believe the most recent legislation has funded a group in Treasury, which hopefully will manage like the recovering implementation office. But what you can also do that for things like let’s just take broadband access, which we’ve learned through COVID has great inequities. You could have a goal leader on broadband access during the Obama administration, we had a goal leader for broadband access and progress was made. We need outcome brokers for every outcome objective. If that exists already. Great. You don’t need to create it. If it doesn’t, then the grant office needs to figure out okay, should we create it and then who’s on that team, whether it’s in the grant office or it’s in the evaluation office or it’s in a data shop, it’s another agency. It’s even somewhere in the nonprofits, but you need the data, you need the findings of well designed trials to figure out where to focus to find ways to improve, and then to increase adoption of better practices and reduce the use of less good ones that requires both conversations and analysis. And the other thing is, new technologies make that analysis and those conversations more feasible and affordable in a timely way than ever before.

Tom Temin: Basically, then the government has the muscle that it needs, it simply needs to exercise apparatuses and mechanisms that are in the toolbox. Now, I’m mixing my metaphors. But that’s the idea.

Shelley Metzenbaum: In many ways, yes. And then the other thing you need to do is think about the incentive structures and the accountability expectations. If we think if we start to and and I see the language all the time, it’s, it’s not about funding, what works and defunding what doesn’t. If the problem still exists, you need to find what works first. And then you need to find what works better what’s more effective and cost effective. If you can’t find what works, you need to put more money into that. So the learning agendas are an opportunity to sort of say, Where are the knowledge gaps, let’s fill them but don’t manage the learning agenda separate from the grant program. Let’s get this as a coherent whole. But beyond that, let’s make sure the oversight bodies, whether it is the grant program, doing oversight of the grant recipients, it’s the IG doing it of the grant program, or its GAO, doing it of the grant program. Let’s hold people accountable for clarity of outcome objectives for finding the data they need to find ways to improve, and then bringing people together to use the information to add, when do I need to do a well designed trial? How do I get that going? But bring them together continually to find out how to improve continuously. We need to get those incentive structures right. Office of Personnel Management needs to make sure that senior executives are not being held accountable for meeting targets or doing better than others, but rather for clarity of outcome objectives, and then managing to improve using evidence.

Tom Temin: Shelley Metzenbaum is, among other things, founding president of the Volcker Alliance, and author of a recent IBM Center for the Business of Government report on grants management. Thanks so much for joining me.

Shelley Metzenbaum: Tom. It is always great to hang out with you and talk about these wonderful government geeky topics.

Tom Temin: Alright, we’re the geeky topic station.

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