With approximately 1,000 entitlement communities receiving grants under most of CPD's 4 major formula programs (CDBG, HOME, ESG, HOPWA), in addition to the competitive grants, CPD has the immense responsibility of effectively managing all of the grants and programs. Acknowledging that HUD is in the business of more than giving out grants, CPD realized that it had to devise a strategy and plan for assisting communities realize the goals and objectives identified in their Consolidated Plans and hold them accountable for the proper expenditure of public funds. In this endeavor, CPD created the Grants Management System (GMS) in 1996.

The Grants Management Process is a seven step cycle which includes the following operating principles: (1) consultation, (2) performance-based program management, (3) consolidated plan review and assessment, (4) consolidated annual performance and evaluation reports, (5) annual community assessments, (6) annual comparative review, (7) and best practices. The goal of this process is to ensure grantee performance is being assessed throughout the year by supplementing on-site monitoring of grantees with remote monitoring of key documents and information. On-going assessments allow HUD to monitor, identify and address any problems early on and as soon as possible. Such proactive steps are of tremendous benefit to both HUD and its grantees. HUD is able to protect the public trust by preventing waste, fraud, and abuse. Grantees that are having problems and need technical assistance and guidance from HUD can get it early on.

As with any plan, after conceptualization, implementation is the second, and often the most challenging, step. CPD acknowledges the problems associated with the implementation of GMS. In its endeavor to determine how best to manage grants, CPD is committed to and in the process of addressing these identified problems.

Although some of the implementation problems are technological in nature, the most critical problem was related to the dual and conflicting roles of CPD field staff. For years, CPD field staff had to serve two functions: that of community relations/advocacy and that of monitoring performance. These dual and conflicting roles meant that along the way one of the two functions inevitably would not have as much attention devoted to it as it should. So although GMS was a sound process and system (as GAO has noted in its report), without staff having the capacity to devote themselves to the process it cannot be successful. The delineation of the responsibilities of Public Trust Officers, the training of staff and the utilization of Business and Operating Plan (BOP) goals are all steps that CPD has taken in order to develop and increase staff capacity to carry out its grants management duties.

CPD Efforts to Improve Internal Controls: Delineation of Roles and Training of Staff

Under HUD Management Reform 2020, the long-standing "dual role" problem that CPD field staff faced was eliminated. The Public Trust and Community Building functions were separated and their respective responsibilities were clearly delineated. Public Trust Officers (PTOs) were charged with the primary function of monitoring grantees.

Since Reform 2020, CPD PTOs are focusing primarily on ensuring the public trust through the implementation of GMS. As of December 31, 1998, a risk analysis has been conducted for all of CPD formula grantees and a fair portion of its competitive grantees. Detailed work plans have been prepared indicating a schedule for servicing those grantees most in need.

CPD is no longer in the transition mode of Reform 2020. CPD has conducted training for all field staff and continues to train new staff and Community Builders to acclimate them to CPD processes and procedures under Reform 2020.

Stabilization of the Grants Management System

CPD has been implementing GMS with the objective of managing its community and economic development inventory. The seven step Grants Management Process includes the seven operating principles previously outlined, and also involves the use of "in-depth" risk analysis procedures designed to analyze closely each grantee performance in managing its CPD programs. CPD is taking a close look at the GAO's assessment of the risk analysis process and is evaluating it as well.

In 1998, CPD responded to feedback from the field and enhanced the process for tracking comprehensive on-site monitoring of grantees by field offices. This enhanced GMS, Version 4.0, released in March 1999, contains descriptions of all key fields and a more detailed tracking system for on-site monitoring that responds to the concerns raised by GAO. The additional screen will allow each field office to describe each on-site monitoring visit in terms of the program monitored, all program issues covered during the visit, the number of days spent with the grantee, the findings of the site visit, and any sanctions. Technical assistance on system usage and system modification is on-going.

As a result of an internal assessment conducted during the summer of 1998, CPD concluded that the GMP Policy Notebook warranted more detailed information to assist the field in implementing the GMS process. CPD is in the process of revising the GMP Policy Notebook and developing a companion self-training and reference guide for HUD staff and grantees on the seven steps of the Grants Management Process. The purpose is to ensure full implementation and operation of GMS.

Utilization of BOPs to Increase On-Site Monitoring

CPD staff worked vigorously to develop local Business and Operating Plans (BOPs) to better utilize the PTO expertise in the area of grants management. In addition, the BOPs sought travel resources necessary to adequately carry out the PTO duties and responsibilities. The funds required to execute FY 99 required on-sight monitoring have been approved by Headquarters.

The projected number of on-site monitoring visits for FY 99 is approximately 300. This is a notable increase from the approximately 100 actual on-site monitoring visits conducted in FY 98.

Introduction

The primary function of the Integrated Disbursement Information System (IDIS) is to enable grantees to draw down program funds. The system has been in operation since February, 1996, and currently serves over 972 entitlement communities and 11 states. Since its inception, IDIS has disbursed $7.145 billion to date, at a rate of approximately $4.5 million a year (not including disbursements to states). The amount of dollars disbursed per month has been steadily increasing as well. In 1998, the amount of disbursement increased from $244 million in January to $309 million in March. In 1999, the amount of disbursement increased from $316 million in January to $569 million in March.

Realizing that IDIS could be enhanced to be of value to not only grantees, but also HUD and Congress, CPD developed and incorporated a reporting function for entitlement grantees that tied the release of funds to the input of projects and activities. This reporting system enables HUD to have timely and accurate information on grantee expenditures and program performance. Furthermore, this feature expedites the process of reporting to Congress.

Currently there are approximately 130,000 projects and 382,000 activities in IDIS. Since January, 1999, approximately 344 activities are reported per day. In terms of users, IDIS is the biggest system in operation at HUD, with 8,000 grantee users and 500 HUD employee-users. IDIS is also the first system to allow users direct, hands-on access to the system.

As with the Grants Management System, problems associated with the implementation phase of IDIS have arisen and been identified. And as with GMS, given the enormous amount of grantee data and information that IDIS is designed to process, glitches are inevitable. It is important to recognize that the financial disbursement element--the primary function--of IDIS is up and functioning. However, the enhanced feature of IDIS--the reporting system--has encountered some problems. As the number of users has grown, they have assisted CPD in identifying the breadth of issues to be tackled. CPD has publicly acknowledged such problems and, since September, 1998, has stopped adding to the system in order to go back and address the elements that are not functioning.

Outreach

CPD acknowledges the importance of outreaching to our partners in the communities that we serve. It is through such interactions that we can identify our successes and problem areas. CPD senior officials and staff have conducted 50 meetings with various public interest groups and user groups since February, 1996. Furthermore, Bob Meehan, Director of CPD's Systems Development and Evaluations Division, has attended the national membership meetings of several major interest groups (including NAHRO, NCDA and COSCDA) to address their constituents' issues with IDIS. CPD is and continues to be committed to listening and outreaching to its clients.

Stabilization of IDIS

In its endeavor to improve the functionality of the system, CPD solicited the feedback of IDIS users, such as entitlement and state grantees and CPD field staff, in order to identify the problematic elements of IDIS. Utilizing such input, CPD and HUD's Office of Information Technology have developed the IDIS Stabilization Plan. The Plan is based on a list of all known issues, concerns, and problems that need to be addressed in IDIS and that will be carried out by CPD and OIT in FY 1999. The Plan will ensure that CPD and OIT deliver a system that meets the financial and information needs of all IDIS users, including entitlement and state grantees, CPD field and headquarters staff, and other stakeholders.

The Stabilization Plan categorizes software and data stabilization items into high-, medium-, or low-priority groups to be completed within five months, eight months, and ten months, respectively, from January, 1999.

High priority action items pertain to key financial and information reporting functions. These function have the widest impact, affecting all grantees, and are key to the design of the Departmental Grants Management System. Examples of items that have been addressed and have either been completed or are in the process of being completed include:

• log-on messages: With the rapid changes occurring with IDIS, users have expressed concerns about being kept informed of any alterations. CPD utilizes the log-on messages to notify and inform users of any such changes that have been made and that are pending.

• a pre-production practice area: This area allows users to test out new or revised features of IDIS without any risk of harm to their real production information.

• a faster system: Users had expressed concerns about the speed of the system both in terms of entering information and in the transfer of funds to their accounts. The system has and continues to be fine-tuned to address these concerns.

• cash to accrual accounting system: Users had commented that they would like to have the option of either a cash or an accounting system. CPD is working to make this option available by September 30, 1999.

• revolving fund program: Again, in response to user groups' feedback, CPD has worked out a process for this program that will be in place by September 30, 1999.

There are over 100 high-priority software and data stabilization action items. A pre-production or test version of IDIS released on Tuesday, April 27, 1999, addresses approximately 25% of these priority items. While CPD and OIT have been releasing fixes on a monthly basis, this is the largest fix to date. CPD is committed to resolving all high-priority action items by September 30 of this year.

Converting states to IDIS is a long-standing issue. CPD set a goal to have states converted by December 31, 1999 (contingent on the meeting of the identified high-priority items). CPD is pleased to announce that it has been in discussion with several states that are interested in and willing to convert to IDIS.

Closing

CPD recognizes the problems of these two systems and is committed to taking management steps to improve the functionality of both IDIS and GMS. Although some may claim that our self-imposed deadlines are idealistic, we recognize the importance and utility of setting them and intend to make every effort to meet them. Our objective continues to be to ensure that the systems work so that they are of value to the communities we serve.

Content Archived: January 20, 2009