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Report to Congressional Requesters: United States General Accounting Office: GAO: November 2003: NATIONAL EMERGENCY GRANTS: Services to Dislocated Workers Hampered by Delays in Grant Awards, but Labor Is Initiating Actions to Improve Grant Award ProcessNational Emergency Grants: GAO-04-222: Contents: Letter: Appendix I: Briefing Slides: Appendix II: Listing of Surveyed States Awarded a Regular Grant: Appendix III: Summary of Funds Awarded for Regular, Disaster, and Dual Enrollment National Emergency Grant: Appendix IV: Number of Days to Award Regular Grants by State: Related GAO Products: United States General Accounting Office: Washington, DC 20548: November 14, 2003: The Honorable Edward M. Kennedy: Ranking Minority Member: Committee on Health, Education, Labor, and Pensions: United States Senate: The Honorable Patty Murray: Ranking Minority Member: Subcommittee on Employment, Safety and Training: Committee on Health, Education, Labor, and Pensions: United States Senate: Between 2000 and 2002, almost 60,000 mass layoffs of 50 or more workers occurred resulting in nearly 7 million workers losing their jobs. The Workforce Investment Act (WIA) of 1998 authorizes the Department of Labor to award national emergency grants to affected states and local areas to provide employment and training assistance to workers affected by major economic dislocations, such as plant closures, and major disasters, such as floods and hurricanes. Although national emergency grants are intended to be a timely response to unexpected events, questions arose during congressional hearings in April 2003 about whether national emergency grant funds were getting to state and local areas quickly enough to help workers when they needed it the most. WIA specifies separate funding streams for each of the act's main client groups--adults, youths, and dislocated workers--and requires the Secretary of Labor to reserve 20 percent of dislocated worker funds for national emergency grants, demonstrations, and technical assistance. States and local areas apply to the Secretary for national emergency grants when they need additional funds to assist dislocated workers. These include regular grants, which provide employment and training assistance to workers who lost their jobs due to layoffs and plant closings; disaster grants, which provide temporary employment to workers affected by natural disasters and other catastrophic events; and dual enrollment grants to provide supplemental assistance to workers who have been certified by Labor to receive services under the Trade Adjustment Assistance Reform Act of 2002. Workers eligible under dual enrollment grants are typically workers who have lost their jobs because of increased imports from, or shifts in production to, foreign countries. At least 85 percent of the Secretary's 20 percent funds must be used for national emergency grants, and these funds can only be awarded during the year the funds are allotted. From July 1, 2000 to June 30, 2003, Labor used these funds to award over $614 million in national emergency grants to 46 states and the District of Columbia, Guam, and the Federated States of Micronesia. Because of your concern about whether national emergency grants were awarded to states and local areas quickly enough to provide services to workers when they are most needed, you asked us to (1) determine the length of time Labor takes to award national emergency grants, (2) determine the effect delays in grant awards have on the ability of states and local areas to provide workers with employment and training services, and (3) identify actions Labor is taking to improve the timeliness of grant awards. To respond to these issues, we interviewed Labor officials at both headquarters and regional offices, reviewed Labor files for all grants awarded between July 1, 2000 and June 30, 2003, and surveyed officials in the 39 states that had received at least one regular national emergency grant during that period. We received responses from 38 states. We conducted our work from March to October 2003 in accordance with generally accepted government auditing standards. On November 5, 2003, we briefed your staffs on the interim results of our ongoing work. This report formally conveys the information provided during that briefing. Appendix I contains the briefing slides. In summary, we found that Labor awards virtually all of the funds available each year for national emergency grants, but that it rarely awards regular national emergency grants within its goal of 30 days.[Footnote 1] Nearly 90 percent of regular grant awards took longer than 30 days, and about 46 percent took 90 days or more. For regular grants, which represent about 64 percent of the grants and 58 percent of the funds awarded between July 1, 2000 and June 30, 2003, it took Labor an average of 92 days to send the notification of an award after receiving an application. The amount of time Labor took to award regular grants appeared to be related to the quarter in which the application was received. For example, regular grant applications received in the first-quarter of a program year [Footnote 2] averaged 111 days from the time the application was received to the time the grant was awarded, whereas applications received in the fourth-quarter averaged 58 days. Furthermore, nearly 60 percent of all regular grants were awarded in the fourth-quarter of the program year, representing nearly two-thirds of the regular grants funds awarded, and 40 percent during the final month, representing about one-half of the regular grant funds awarded. Labor took less time to award dual enrollment and disaster grants. Dual enrollment grants, which represent about one- third of the funds awarded, took an average of 20 days to award after the applications were received, and disaster grants, which represent less than 10 percent of the funds awarded, took an average of 48 days. Thirty-three of the 39 states that received at least one regular grant between July 1, 2000, and June 30, 2003, said that the amount of time it takes to receive regular grant funds was a major problem. In fact, 25 of the states reported that because of the delays in receiving grant funds, they had to delay or deny services to dislocated workers. Twenty of these states reported that local areas had to delay training for dislocated workers because, while waiting for national emergency grant funds, they did not have funds available to enroll them in training. For example, in 1 state, workers were on waiting lists for 3 to 4 months before they received training. Officials in another state reported that a local area cancelled training for over 300 workers because of a delay in receiving grant funds. Labor has said it is taking steps to address the length of time it takes to approve and award national emergency grants. In particular, under proposed guidelines, Labor would commit to approving a grant application within 15 business days of receiving a complete application. Labor is also developing a Web-based, electronic system that would allow states to apply for grants on-line. The system is also intended to help Labor better manage the review process by automatically assigning applications to specific staff members, specifying the number of days that they have to complete their responsibilities, and tracking their completion dates. Labor expects that the new guidelines and electronic system will be finalized in December 2003. In addition, according to Labor officials, they are considering additional steps to enhance the award process, such as reviewing the entire grant award process and developing training for states and local areas on applying for national emergency grants. As part of our ongoing work, we will assess in more detail whether Labor's proposed actions are likely to improve the process for awarding national emergency grants. We provided a draft of this report to officials at Labor for their technical review and incorporated their comments where appropriate. We are sending copies of this report to relevant congressional committees and other interested parties and will make copies available to others upon request. In addition, the report will be available at no charge on GAO's Web site at http://www.gao.gov. If you or your staffs have any questions about this report, please contact me at (202) 512- 7215 or Joan Mahagan at (617) 788-0521. Wayne Sylvia and Yunsian Tai also made key contributions to this report. Sigurd R. Nilsen: Director, Education, Workforce, and Income Security Issues: Signed by Sigurd R. Nilsen: [End of section] Appendix I: Briefing Slides: [See PDF for image] [End of figure] [End of section] Appendix II: Listing of Surveyed States Awarded a Regular Grant: Listing of 39 States Surveyed That Were Awarded a Regular National Emergency Grant during Program Years 2000 through 2002: Alabama; Arkansas; Kentucky; Maine; Ohio; Oklahoma; California; Maryland; Oregon; Colorado; Massachusetts; Pennsylvania; Connecticut; Michigan; Rhode Island; District of Columbia; Minnesota; South Carolina; Florida; Mississippi; South Dakota; Georgia; Missouri; Tennessee; Idaho; Montana; Texas; Illinois; Nebraska; Vermont, Indiana; Nevada; Virginia; Iowa; New Hampshire; Washington; Kansas; New Jersey; Wisconsin. Source: GAO analysis of national emergency grants awarded between July 1, 2000 and June 30, 2003. [End of table] [End of section] Appendix III: Summary of Funds Awarded for Regular, Disaster, and Dual Enrollment National Emergency Grant: Program Years 2000 through 2002: State[A]: Alabama; Program year 2000: $6,100,000; Program year 2001: $3,461,359; Program year 2002: $765,689; Total: $10,327,048. State[A]: Arizona; Program year 2000: 1,271,931; Program year 2001: 0; Program year 2002: 2,747,960; Total: 4,019,891. State[A]: Arkansas; Program year 2000: 9,745,980; Program year 2001: 0; Program year 2002: 1,433,566; Total: 11,179,546. State[A]: California; Program year 2000: 42,631,721; Program year 2001: 2,679,762; Program year 2002: 1,896,786; Total: 47,208,269. State[A]: Colorado; Program year 2000: 0; Program year 2001: 3,700,000; Program year 2002: 3,509,933; Total: 7,209,933. State[A]: Connecticut; Program year 2000: 1,202,002; Program year 2001: 1,534,400; Program year 2002: 3,203,075; Total: 5,939,477. State[A]: District of Columbia; Program year 2000: 876,573; Program year 2001: 0; Program year 2002: 0; Total: 876,573. State[A]: Federated States of Micronesia; Program year 2000: 0; Program year 2001: 0; Program year 2002: 1,150,000; Total: 1,150,000. State[A]: Florida; Program year 2000: 212,346; Program year 2001: 8,602,272; Program year 2002: 8,603,858; Total: 17,418,476. State[A]: Georgia; Program year 2000: 0; Program year 2001: 3,026,880; Program year 2002: 420,000; Total: 3,446,880. State[A]: Guam; Program year 2000: 0; Program year 2001: 0; Program year 2002: 13,300,000; Total: 13,300,000. State[A]: Idaho; Program year 2000: 1,072,489; Program year 2001: 1,800,000; Program year 2002: 3,373,185; Total: 6,245,674. State[A]: Illinois; Program year 2000: 5,250,562; Program year 2001: 7,000,000; Program year 2002: 4,000,889; Total: 16,251,451. State[A]: Indiana; Program year 2000: 0; Program year 2001: 3,505,274; Program year 2002: 3,769,867; Total: 7,275,141. State[A]: Iowa; Program year 2000: 4,498,909; Program year 2001: 4,728,639; Program year 2002: 6,748,852; Total: 15,976,400. State[A]: Kansas; Program year 2000: 620,226; Program year 2001: 0; Program year 2002: 5,792,029; Total: 6,412,255. State[A]: Kentucky; Program year 2000: 0; Program year 2001: 0; Program year 2002: 10,935,804; Total: 10,935,804. State[A]: Louisiana; Program year 2000: 3,280,000; Program year 2001: 0; Program year 2002: 1,500,000; Total: 4,780,000. State[A]: Maine; Program year 2000: 1,200,000; Program year 2001: 6,425,441; Program year 2002: 10,488,317; Total: 18,113,758. State[A]: Maryland; Program year 2000: 0; Program year 2001: 5,970,294; Program year 2002: 3,181,022; Total: 9,151,316. State[A]: Massachusetts; Program year 2000: 0; Program year 2001: 15,697,403; Program year 2002: 15,938,190; Total: 31,635,593. State[A]: Michigan; Program year 2000: 0; Program year 2001: 4,153,666; Program year 2002: 5,709,991; Total: 9,863,657. State[A]: Minnesota; Program year 2000: 0; Program year 2001: 8,000,000; Program year 2002: 11,990,890; Total: 19,990,890. State[A]: Mississippi; Program year 2000: 0; Program year 2001: 0; Program year 2002: 1,644,366; Total: 1,644,366. State[A]: Missouri; Program year 2000: 2,070,883; Program year 2001: 1,913,322; Program year 2002: 11,449,938; Total: 15,434,143. State[A]: Montana; Program year 2000: 9,576,978; Program year 2001: 2,876,534; Program year 2002: 2,114,478; Total: 14,567,990. State[A]: Nebraska; Program year 2000: 1,121,474; Program year 2001: 2,168,931; Program year 2002: 236,054; Total: 3,526,459. State[A]: Nevada; Program year 2000: 0; Program year 2001: 1,900,000; Program year 2002: 3,900,000; Total: 5,800,000. State[A]: New Hampshire; Program year 2000: 0; Program year 2001: 5,004,456; Program year 2002: 470,403; Total: 5,474,859. State[A]: New Jersey; Program year 2000: 6,245,346; Program year 2001: 270,000; Program year 2002: 3,442,318; Total: 9,957,664. State[A]: New Mexico; Program year 2000: 0; Program year 2001: 0; Program year 2002: 560,842; Total: 560,842. State[A]: New York; Program year 2000: 0; Program year 2001: 0; Program year 2002: 1,561,851; Total: 1,561,851. State[A]: North Carolina; Program year 2000: 6,300,000; Program year 2001: 5,989,718; Program year 2002: 7,084,245; Total: 19,373,963. State[A]: North Dakota; Program year 2000: 378,793; Program year 2001: 0; Program year 2002: 99,000; Total: 477,793. State[A]: Ohio; Program year 2000: 15,200,826; Program year 2001: 0; Program year 2002: 11,838,929; Total: 27,039,755. State[A]: Oklahoma; Program year 2000: 0; Program year 2001: 1,175,155; Program year 2002: 5,609,778; Total: 6,784,933. State[A]: Oregon; Program year 2000: 10,905,717; Program year 2001: 11,397,917; Program year 2002: 4,513,004; Total: 26,816,638. State[A]: Pennsylvania; Program year 2000: 16,139,341; Program year 2001: 19,579,042; Program year 2002: 33,672,196; Total: 69,390,579. State[A]: Rhode Island; Program year 2000: 2,827,470; Program year 2001: 0; Program year 2002: 268,236; Total: 3,095,706. State[A]: South Carolina; Program year 2000: 0; Program year 2001: 0; Program year 2002: 3,414,658; Total: 3,414,658. State[A]: South Dakota; Program year 2000: 1,088,725; Program year 2001: 250,000; Program year 2002: 1,093,540; Total: 2,432,265. State[A]: Tennessee; Program year 2000: 375,000; Program year 2001: 1,352,774; Program year 2002: 3,988,873; Total: 5,716,647. State[A]: Texas; Program year 2000: 7,732,972; Program year 2001: 16,943,771; Program year 2002: 2,111,738; Total: 26,788,481. State[A]: Utah; Program year 2000: 0; Program year 2001: 0; Program year 2002: 740,230; Total: 740,230. State[A]: Vermont; Program year 2000: 0; Program year 2001: 400,000; Program year 2002: 985,877; Total: 1,385,877. State[A]: Virginia; Program year 2000: 15,000,000; Program year 2001: 4,715,000; Program year 2002: 5,938,031; Total: 25,653,031. State[A]: Washington; Program year 2000: 6,068,668; Program year 2001: 5,000,000; Program year 2002: 14,361,486; Total: 25,430,154. State[A]: West Virginia; Program year 2000: 0; Program year 2001: 9,499,990; Program year 2002: 3,000,000; Total: 12,499,990. State[A]: Wisconsin; Program year 2000: 5,554,054; Program year 2001: 10,152,032; Program year 2002: 4,457,451; Total: 20,163,537. Total; Program year 2000: $184,548,986; Program year 2001: $180,874,032; Program year 2002: $249,017,425; Total: $614,440,443. Source: GAO analysis of regular, disaster, and dual enrollment grant funds awarded between July 1, 2000 and June 30, 2003: [A] Alaska, Delaware, Hawaii, and Wyoming did not receive any regular, disaster, or dual enrollment national emergency grants. [End of table] [End of section] Appendix IV: Number of Days to Award Regular Grants by State: State: Alabama; Number of regular grants[A]: 2; Average number of days from receipt of application to award: 120. State: Arkansas; Number of regular grants[A]: 1; Average number of days from receipt of application to award: 23. State: California; Number of regular grants[A]: 1; Average number of days from receipt of application to award: 206. State: Colorado; Number of regular grants[A]: 1; Average number of days from receipt of application to award: 62. State: Connecticut; Number of regular grants[A]: 6; Average number of days from receipt of application to award: 102. State: District of Columbia; Number of regular grants[A]: 1; Average number of days from receipt of application to award: 131. State: Florida; Number of regular grants[A]: 1; Average number of days from receipt of application to award: 63. State: Georgia; Number of regular grants[A]: 4; Average number of days from receipt of application to award: 137. State: Idaho; Number of regular grants[A]: 4; Average number of days from receipt of application to award: 70. State: Illinois; Number of regular grants[A]: 3; Average number of days from receipt of application to award: 39. State: Indiana; Number of regular grants[A]: 2; Average number of days from receipt of application to award: 92. State: Iowa; Number of regular grants[A]: 16; Average number of days from receipt of application to award: 103. State: Kansas; Number of regular grants[A]: 3; Average number of days from receipt of application to award: 63. State: Kentucky; Number of regular grants[A]: 3; Average number of days from receipt of application to award: 126. State: Maine; Number of regular grants[A]: 13; Average number of days from receipt of application to award: 91. State: Maryland; Number of regular grants[A]: 2; Average number of days from receipt of application to award: 77. State: Massachusetts; Number of regular grants[A]: 9; Average number of days from receipt of application to award: 87. State: Michigan; Number of regular grants[A]: 3; Average number of days from receipt of application to award: 85. State: Minnesota; Number of regular grants[A]: 3; Average number of days from receipt of application to award: 103. State: Missouri; Number of regular grants[A]: 12; Average number of days from receipt of application to award: 99. State: Montana; Number of regular grants[A]: 5; Average number of days from receipt of application to award: 51. State: Nebraska; Number of regular grants[A]: 2; Average number of days from receipt of application to award: 40. State: Nevada; Number of regular grants[A]: 1; Average number of days from receipt of application to award: 79. State: New Hampshire; Number of regular grants[A]: 3; Average number of days from receipt of application to award: 78. State: New Jersey; Number of regular grants[A]: 3; Average number of days from receipt of application to award: 174. State: Ohio; Number of regular grants[A]: 4; Average number of days from receipt of application to award: 40. State: Oklahoma; Number of regular grants[A]: 3; Average number of days from receipt of application to award: 123. State: Oregon; Number of regular grants[A]: 6; Average number of days from receipt of application to award: 96. State: Pennsylvania; Number of regular grants[A]: 4; Average number of days from receipt of application to award: 109. State: Rhode Island; Number of regular grants[A]: 3; Average number of days from receipt of application to award: 32. State: South Carolina; Number of regular grants[A]: 1; Average number of days from receipt of application to award: 122. State: South Dakota; Number of regular grants[A]: 3; Average number of days from receipt of application to award: 82. State: Tennessee; Number of regular grants[A]: 2; Average number of days from receipt of application to award: 116. State: Texas; Number of regular grants[A]: 3; Average number of days from receipt of application to award: 122. State: Virginia; Number of regular grants[A]: 2; Average number of days from receipt of application to award: 106. State: Vermont; Number of regular grants[A]: 1; Average number of days from receipt of application to award: 90. State: Wisconsin; Number of regular grants[A]: 5; Average number of days from receipt of application to award: 77. [A] Represents the number of regular grants for which complete information was available. There were a total of 14 regular grants for which we did not have complete information. [End of table] [End of section] Related GAO Products: Workforce Investment Act: Potential Effects of Alternative Formulas on State Allocations. GAO-03-1043. Washington, D.C.: August 28, 2003. Workforce Investment Act: One-Stop Centers Implemented Strategies to Strengthen Services and Partnerships, but More Research and Information Sharing is Needed. GAO-03-725. Washington, D.C.: June 18, 2003. Workforce Investment Act: Exemplary One-Stops Devised Strategies to Strengthen Services, but Challenges Remain for Reauthorization. GAO-03- 884T. Washington, D.C.: June 18, 2003. Workforce Investment Act: Issues Related to Allocation Formulas for Youth, Adults, and Dislocated Workers. GAO-03-636. Washington, D.C.: April 25, 2003. Multiple Employment and Training Programs: Funding and Performance Measures for Major Programs. GAO-03-589. Washington, D.C.: April 18, 2003. Workforce Training: Employed Worker Programs Focus on Business Needs, but Revised Performance Measures Could Improve Access for Some Workers. GAO-03-353. Washington, D.C.: February 14, 2003. Older Workers: Employment Assistance Focuses on Subsidized Jobs and Job Search, but Revised Performance Measures Could Improve Access to Other Services. GAO-03-350. Washington, D.C.: January 24, 2003. Workforce Investment Act: States' Spending Is on Track, but Better Guidance Would Improve Financial Reporting. GAO-03-239. Washington, D.C.: November 22, 2002. Workforce Investment Act: Interim Report on Status of Spending and States' Available Funds. GAO-02-1074. Washington, D.C.: September 5, 2002. Workforce Investment Act: Better Guidance and Revised Funding Formula Would Enhance Dislocated Worker Program. GAO-02-274. Washington, D.C.: February 11, 2002. FOOTNOTES [1] Labor's goal measures the number of calendar days between the date a complete application is received and the date the grant award is approved by the Secretary. After approval, Labor notifies the appropriate congressional office and issues the award letter. We tracked the number of calendar days between the date the original application was received and the date of the award letter. [2] A program year begins on July 1 of a year and ends on June 30 of the following year. 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