Some agencies charged more than others for Grants.gov use, GAO says

Some federal agencies are paying more to use the Grants.gov program than other agencies are paying for the same services, according to a report from the Government Accountability Office.

At least two-dozen agencies use the Grants.gov website to operate their federal grant programs. The agencies pay fees to use the site, but GAO auditors found that some agencies pay higher fees, according to a report issued May 6.

For example, in fiscal 2011, the Housing and Urban Development Department posted 40 grant opportunities and received 4,817 applications through Grants.gov, while the National Endowment for the Humanities posted 42 grants and received 4,577 applications. HUD paid $414,422 in fees, while NEH paid $155,159, GAO said.

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The apparent discrepancy is due to the fact that Grants.gov fees are calculated based on the agency’s size, among other factors, rather than being based on actual use, the report states.

GAO recommended fixing the inconsistency.

“According to federal cost accounting standards, agencies should assign costs as closely as possible based on the amount of services or goods provided,” the report states. Requiring a beneficiary to pay for the services it receives promotes economic efficiency because a system in which fees are not based on actual use could result in undercharging, overcharging or cross-subsidization, the report added.

The Office of Management and Budget created Grants.gov as an e-government initiative in 2002. The Health and Human Services Department now manages the site, which began moving from a contribution payment model to a fee-for-service model in 2010.

GAO made four recommendations to the HHS secretary:

• Improve the allocation of costs among users by developing and implementing a calculation that more clearly links agency contributions to their system use.
• Expand cost-tracking capabilities and provide that information to users.
  
• Link HHS’ strategic plan to an annual operating plan that ties costs and spending to performance goals and benchmarks for progress.
  
• Engage in knowledge sharing with the managing partners of other e-government initiatives.

HHS officials agreed with the report and its recommendations.