Rehabilitation Services

In response to a congressional request, GAO reviewed the Department of Education's response to the Human Services Training and Research Council's (HSTRC) complaints concerning grant administration.

GAO noted the HSTRC Executive Director's concerns that Education's Philadelphia regional office had: (1) suggested that HSTRC affiliate itself with the University of Virginia; (2) exceeded its authority in administering grants; (3) exceeded its access-to-records authority in its 1983 review of HSTRC grant activities, which resulted in questionable findings; and (4) improperly encouraged others to apply for grants and requested state rehabilitation agencies to support those applications. GAO found that: (1) the regional office had suggested HSTRC affiliation with the University of Virginia because it would have been economically beneficial, but it had not raised the issue since HSTRC rejected the suggestion; (2) Education did not exceed its authority in requiring HSTRC to submit annual financial and performance reports, monthly performance reports, and information on its training speakers; (3) HSTRC denied Education access to corporate records necessary for the required grant financial review because it maintained only one set of records for all of its activities; (4) a follow-up review with access to the necessary records resolved all of the issues raised except the charging of indirect costs to the grant; and (5) state agencies did not receive any requests to support specific grant applicants. Education advised regional offices to base their grant administration and monitoring on legally binding requirements only, and HSTRC has reported improved relationships with the regional office.