Addressing USASpending Problems

Before he was elected to the White House, Sen. Barack Obama was a proponent of putting more information about government contracts, grants and loans online, teaming up with Sen. Tom Coburn, R-Okla., to introduce the 2006 Federal Funding Accountability and Transparency Act, which requires full disclosure on a Web site maintained by OMB of all organizations receiving more than $25,000 in federal funds. Now as president, it's his job to convince agencies to comply with the law. It's proven more difficult than he may have thought.

In September I wrote about the problems with the federal spending Web site USASpending.gov, which was launched in December 2007 to comply with the law's mandate. At that time, Coburn expressed concern that many agencies were not updating their award data. He also questioned when the site would include data on subcontracts and subgrant awardees, as required by law. OMB responded that agencies were doing their best to comply with the law, but the end of the Bush administration and the accompanying turnover at OMB prevented much in the way of progress during the winter.

In March, Coburn followed up with a letter to President Obama on March 18, questioning when the subaward data would be available on the site and why certain agencies like the Treasury Department had not updated their data in months. On Monday, OMB Director Peter Orzag responded:

The concerns you raise about USASpending.gov are well taken. The Web site is designed to provide a searchable database of government awards and contracts, including information about the funding's recipient, amount, awarding date, awarding agency and purpose. Yet, some chronic issues remain unresolved, particularly with regard to the Web site's completeness and accuracy. We are actively addressing those concerns and are committed to compliance.

Orzag's response includes a background document with a status update on the implementation of the Transparency Act. Among the more notable quotes: "Significant data quality and completeness issues remain with USASpending award information. This is especially true for assistance data (primarily grants and loans), which lack the same level of business process standardization and data quality assurance as exist for federal contracts data."

The report also states that under the Bush administration, OMB did not establish the capacity to collect and report subaward data on a governmentwide basis. For that reason, the Obama administration is planning to use at least a portion of the 18-month grace period allowed in the 2008 update to the Transparency Act. OMB will use the new stimulus transparency Web site Recovery.gov as a model for how to meet the subaward reporting requirements of the law. "Once subaward reporting capabilities are in place for Recovery Act funds and these data are displayed on Recovery.gov, the administration intends to begin broadening subaward reporting requirements to all federal funding, to comply with the Transparency Act."

While much has been made of Obama's Jan. 21st transparency memo and the plethora of Web sites that have recently been launched, Recovery.gov and USASpending.gov will be the true tests of how committed this administration is to providing meaningful insight into federal spending. If implemented correctly, these sites should provide a complete accounting of every organization and company that receives significant federal funding and the purpose of those funds.

Another crucial step will be making the raw data available in a machine-readable format such as XML as required by the law. Allowing the public to download the raw data will allow third parties to analyze and present it in interesting and dynamic ways, much like the original FederalSpending.org site that was the model for USASpending. As many experts have argued, the government's ideal role is as a data provider, not Web site designer.