Better Way To Keep Track of Taxpayer Dollars

Cross-posted from The Hill

Amid larger discussions of government spending surrounding the debt ceiling, farm bill, and Murray-Ryan budget compromise, it’s easy to forget that Congress’ appropriation of funds for agencies and programs is only the beginning. Once agencies receive federal funds, they have a responsibility to taxpayers to ensure the money is spent efficiently and allocated towards achievement of clear goals – especially at this time of national belt-tightening.

That’s why the testimony of Justice Department Inspector General Michael Horowitz last week is so troubling. Before the House Judiciary Committee, Horowitz said his office’s audits had uncovered at least $100 million of Justice Department funds that were questionably spent.

The Justice Department has awarded approximately $17 billion in grants to governmental and nongovernmental recipients over the past five years. But effective monitoring of how these funds are spent does not exist. Testified Horowitz, “Unless there is an OIG audit or investigation, or the granting agency dedicates resources to collect and analyze accounting information from a recipient, the government and taxpayers are virtually in the dark regarding how grant funds were actually used.”

This is a frightening statement about the Justice Department’s ability to manage the billions of dollars it sends across the country each year. It’s clear why the Inspector General’s Office has long considered grant management to be one of DOJ’s top challenges.

Judiciary Chairman Bob Goodlatte (R-Va.) provided a national context for DOJ’s failure to effectively manage its grant funding.

“America continues to face difficult fiscal times,” he said. “Law enforcement agencies are not immune from this. There is little doubt that the financial support the federal government provides to state and local law enforcement agencies through Byrne JAG and other grants is oftentimes critical. As with many other aspects of government, these grant programs are not always designed or administered as efficiently as they should be – which means that less money is actually sent to help the boots on the ground.”

Goodlatte is correct that all too often, federal criminal justice funds flow on autopilot. As a result, good policies and programs are underfunded, while grant recipients often have an incentive to carry out unwise policies.

The Byrne JAG program that he refers to is a prime example. The largest federal grant for criminal justice, amounting to hundreds of millions of dollars a year and directed toward all fifty states and thousands of localities across the country, it suffers from ineffective – and often counterintuitive – measurement of how funds are spent.

When asking JAG grant recipients for information on how the money is spent, DOJ often focuses on volume-based statistics – like how many people were arrested – at the expense of meaningful, results-based statistics, like whether or not the violent crime rate dropped. The result is a signal to local law enforcement who receive the money that their goal should be to arrest as many people as possible, a practice that does not markedly improve public safety. DOJ lacks tools to measure innovative programs, like community policing, with proven records of reducing crime but that are difficult to measure with simplistic volume-based statistics.

Byrne funds for law enforcement are only one example of how DOJ ineffectively measures grant spending. Byrne funds also flow to prosecutors and public defenders, reentry programs, and more. And beyond JAG, DOJ has more than $16 billion of other spending that could benefit from more effective and transparent distribution.

The solution is for DOJ to adopt a “Success-Oriented Funding” model. The concept is simple: fund what works, dump what doesn’t. And in order to do so, measure and monitor where the money goes and how it’s spent. All the while, make that spending information publically available on an online database, so that taxpayers can monitor where there money is going. This will incentivize policies that produce success, and orient thousands of state and local grant recipients toward what should be our country’s biggest criminal justice goal: reduce crime while also reducing an expensive and over-punitive mass incarceration system.

The administration has already begun to implement this type of funding model – which applies the best of proven private sector practice to public dollars – in education and health care. Criminal justice, an area where the President and Attorney General Holder, as well as both Democrats and Republicans in Congress have called for reform, is the smart next step.