Low-Income and Minority Serving Institutions
Management Attention to Long-standing Concerns Needed to Improve Education's Oversight of Grant Programs Gao ID: GAO-09-309 August 17, 2009Institutions that serve large proportions of low-income and minority students may receive funding under Titles III and V of the Higher Education Act. In fiscal year 2008, $667 million in grants were awarded to over 500 institutions. GAO was asked to determine (1) the characteristics of institutions eligible to receive grants under Titles III and V and characteristics of students served; (2) any challenges grantees face, and how they spent Title III and V funds to address these challenges; and (3) the extent to which the Department of Education (Education) monitors the financial and programmatic performance of grantees, and uses this information to target its technical assistance. To address these objectives, GAO analyzed data from a representative sample of grant applications and annual performance reports for the entire population of fiscal year 2006 grantees. GAO also interviewed officials from Education and 27 grantee institutions, and conducted financial site visits at other 7 grantee institutions.
Twenty-eight percent of all 2-year and 4-year public and private, not-for-profit institutions are eligible to receive Title III and V grants. Eligible institutions had fewer resources, including endowment holdings and revenue from tuition and fees, and lower per student spending on equipment than ineligible institutions. Eligible institutions also served more students who were minority, low-income, and attended part-time. In their grant applications, Title III and V grantees reported challenges in all four grant focus areas: academic quality, student support, institutional management, and fiscal stability. Grantees reported spending almost $385 million in fiscal year 2006 grant funds to address challenges in these areas, primarily to strengthen academic quality and student support services. Specifically, grantees reported using 43 percent of grant funds on efforts designed to improve academic quality, such as using the latest technology in the classroom and improving academic space. Efforts to improve student support services, including remedial courses, tutoring, and academic counseling represented about one-third of grantee expenditures. While nearly all grantees reported challenges related to strengthening institutional management and fiscal stability, expenditures in these areas represented less than one-quarter of all grant funds spent. Since GAO reported and made recommendations on the management of these programs in 2004 and 2007, Education has continued to take steps to improve monitoring, but many of its initiatives have not been completed. Education has made recent progress in developing an electronic monitoring system and risk-based criteria to improve monitoring, but it discontinued the use of annual plans to guide its efforts. Also, limited progress in addressing staff skill gaps and substantial declines in site visits to grantees has impeded Education's ability to adequately monitor grantees. Because Education lacks a comprehensive approach to target monitoring, it lacks assurance that grantees appropriately manage federal funds, increasing the potential for fraud, waste, or abuse. For example, GAO identified more than $100,000 in questionable expenditures at one grantee institution, including student trips to locations such as resorts and amusement parks, and an airplane global positioning system. Education provides limited technical assistance to grantees, but it has not developed a systematic approach that targets the needs of grantees. For example, some grantees told GAO that Education could strengthen grantee performance by sharing more information regarding common implementation challenges and successful projects. Additionally, GAO found that Education's ability to target technical assistance is limited because its current approach for obtaining feedback does not encourage candor, and it does not use the feedback it currently receives from grantees.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Team: Phone:GAO-09-309, Low-Income and Minority Serving Institutions: Management Attention to Long-standing Concerns Needed to Improve Education's Oversight of Grant Programs
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Report to the Chairman, Subcommittee on Higher Education, Lifelong
Learning, and Competitiveness, Committee on Education and Labor, House
of Representatives:
United States Government Accountability Office:
GAO:
August 2009:
Low-Income And Minority Serving Institutions:
Management Attention to Long-standing Concerns Needed to Improve
Education's Oversight of Grant Programs:
GAO-09-309:
GAO Highlights:
Highlights of GAO-09-309, a report to the Chairman, Subcommittee on
Higher Education, Lifelong Learning, and Competitiveness, Committee on
Education and Labor, House of Representatives.
Why GAO Did This Study:
Institutions that serve large proportions of low-income and minority
students may receive funding under Titles III and V of the Higher
Education Act. In fiscal year 2008, $667 million in grants were awarded
to over 500 institutions. GAO was asked to determine (1) the
characteristics of institutions eligible to receive grants under Titles
III and V and characteristics of students served; (2) any challenges
grantees face, and how they spent Title III and V funds to address
these challenges; and (3) the extent to which the Department of
Education (Education) monitors the financial and programmatic
performance of grantees, and uses this information to target its
technical assistance. To address these objectives, GAO analyzed data
from a representative sample of grant applications and annual
performance reports for the entire population of fiscal year 2006
grantees. GAO also interviewed officials from Education and 27 grantee
institutions, and conducted financial site visits at other 7 grantee
institutions.
What GAO Found:
Twenty-eight percent of all 2-year and 4-year public and private, not-
for-profit institutions are eligible to receive Title III and V grants.
Eligible institutions had fewer resources, including endowment holdings
and revenue from tuition and fees, and lower per student spending on
equipment than ineligible institutions. Eligible institutions also
served more students who were minority, low-income, and attended part-
time.
In their grant applications, Title III and V grantees reported
challenges in all four grant focus areas: academic quality, student
support, institutional management, and fiscal stability. Grantees
reported spending almost $385 million in fiscal year 2006 grant funds
to address challenges in these areas, primarily to strengthen academic
quality and student support services. Specifically, grantees reported
using 43 percent of grant funds on efforts designed to improve academic
quality, such as using the latest technology in the classroom and
improving academic space. Efforts to improve student support services,
including remedial courses, tutoring, and academic counseling
represented about one-third of grantee expenditures. While nearly all
grantees reported challenges related to strengthening institutional
management and fiscal stability, expenditures in these areas
represented less than one-quarter of all grant funds spent.
Since GAO reported and made recommendations on the management of these
programs in 2004 and 2007, Education has continued to take steps to
improve monitoring, but many of its initiatives have not been
completed. Education has made recent progress in developing an
electronic monitoring system and risk-based criteria to improve
monitoring, but it discontinued the use of annual plans to guide its
efforts. Also, limited progress in addressing staff skill gaps and
substantial declines in site visits to grantees has impeded Education‘s
ability to adequately monitor grantees. Because Education lacks a
comprehensive approach to target monitoring, it lacks assurance that
grantees appropriately manage federal funds, increasing the potential
for fraud, waste, or abuse. For example, GAO identified more than
$100,000 in questionable expenditures at one grantee institution,
including student trips to locations such as resorts and amusement
parks, and an airplane global positioning system. Education provides
limited technical assistance to grantees, but it has not developed a
systematic approach that targets the needs of grantees. For example,
some grantees told GAO that Education could strengthen grantee
performance by sharing more information regarding common implementation
challenges and successful projects. Additionally, GAO found that
Education‘s ability to target technical assistance is limited because
its current approach for obtaining feedback does not encourage candor,
and it does not use the feedback it currently receives from grantees.
What GAO Recommends:
GAO recommends that Education develop a comprehensive, risk-based
approach to target monitoring and technical assistance; follow-up on
improper uses of grant funds identified in this report; ensure staff
training needs are fully met; disseminate information about
implementation challenges and successful projects to grantees; and
develop appropriate feedback mechanisms. Education agreed with our
recommendations.
View [hyperlink, http://www.gao.gov/products/GAO-09-309] or key
components. For more information, contact George Scott at (202) 512-
7215 or scottg@gao.gov.
[End of section]
Contents:
Letter:
Background:
Eligible Institutions Had Fewer Resources to Serve Proportionately More
Students at Academic Risk:
Institutions Faced Challenges across the Grant Programs' Four Focus
Areas but Spent Most of Their Funds in Two Areas, Academic Quality and
Student Support:
Long-standing Deficiencies in Grant Monitoring and Technical Assistance
Limit Education's Ability to Ensure That Funds Are Used Properly and
Grantees Are Supported:
Conclusions:
Recommendations for Executive Action:
Agency Comments:
Appendix I: Objectives, Scope, and Methodology:
Appendix II: Institutional and Student Characteristics, by Program
Eligibility Status:
Appendix III: Fiscal Year 2002 to 2005 Grantee Expenditures by Focus
Area:
Appendix IV: Comments from the Department of Education:
Appendix V: GAO Contact and Staff Acknowledgments:
Tables:
Table 1: Characteristics and Eligibility Criteria of Title III and V
Grant Programs:
Table 2: Title III and V Funding, Fiscal Years 1999 and 2008:
Table 3: Comparison of All Title III and V Allowable Activities by
Program:
Table 4: Summary of Opportunities for Improvement in Grants Management:
Table 5: Title III and V Eligibility Status of Postsecondary
Institutions:
Table 6: A Comparison of the Status of Education's Monitoring
Initiatives in 2004 and 2008:
Table 7: Site Visits to Title III and V Grantees, Fiscal Years 2003
through 2008:
Table 8: Summary of Findings from Financial Site Visits:
Table 9: Number of 2002 to 2006 Applications Reviewed during Content
Analysis:
Table 10: Summary of GAO Contacts with Title III and V Grantees:
Figures:
Figure 1: Location of Institutions Currently Eligible for Title III and
V Funding and Projected Change in College-Age Minority Population by
2015:
Figure 2: Race and Ethnicity, by Eligibility Status, 2006:
Figure 3: Fiscal Year 2006 Grantee Expenditures by Focus Area:
Figure 4: Before-and-After Photos of Science Facilities on Native
Hawaiian Campus:
Figure 5: Monitoring Index Criteria Used to Assess Institutional Risks:
Figure 6: Desk and Chair Purchased by Grantee:
Figure 7: Fiscal Years 2002 and 2003 Grantee Expenditures, by Focus
Area:
Figure 8: Fiscal Years 2004 and 2005 Grantee Expenditures, by Focus
Area:
Abbreviations:
Education: Department of Education:
HEA: Higher Education Act of 1965:
IDUES: Institutional Development and Undergraduate Education Service:
IPEDS: Integrated Postsecondary Data Systems:
NPSAS: National Postsecondary Student Aid Study:
OPE: Office of Postsecondary Education:
[End of section]
United States Government Accountability Office:
Washington, DC 20548:
August 17, 2009:
The Honorable Rubén Hinojosa:
Chairman:
Subcommittee on Higher Education, Lifelong Learning, and
Competitiveness:
Committee on Education and Labor:
House of Representatives:
Dear Mr. Chairman:
With more than two-thirds of 2008 high school graduates estimated to
enroll in college soon after graduating, higher education has become
more accessible than ever before. Yet students from some demographic
groups still face challenges in attending college. For example, in 2006
only half of low-income students enrolled in college soon after
completing high school, compared to 80 percent of students from high-
income families. Similarly, African American and Hispanic high school
graduates enrolled at lower rates than white students, and those who do
enroll are at greater risk of dropping out before earning a degree or
certificate than other students. Given current population projections
showing the proportion of college-age minorities may increase by as
much as 54 percent for some minority groups over the next decade, the
federal government has a continuing interest in ensuring the needs of
these students are met.
Beginning in 1965, Congress enacted several grant programs under the
Higher Education Act (HEA) to strengthen and support developing
postsecondary institutions. In subsequent reauthorizations, Congress
expanded the HEA to include programs that support institutions that
provide low-income and minority students with access to higher
education. These programs have been authorized under Title III and
Title V of the HEA, as amended.[Footnote 1] Institutions eligible to
receive these grants include Historically Black Colleges and
Universities, Hispanic-serving institutions, Tribal colleges and
universities, Alaska Native-serving institutions, and Native Hawaiian-
serving institutions, and other undergraduate postsecondary
institutions that serve low-income students. In fiscal year 2008, $667
million in grants were awarded to over 500 institutions. Under the
Department of Education's (Education) program guidance, participating
institutions are allowed to spend these grants on challenges in four
focus areas: academic quality, student support services, institutional
management, and fiscal stability. Within these areas, activities might
include renovating existing buildings to upgrade technological
capacity, providing remedial classes or tutoring, developing faculty,
or building endowments, among others.
In 2004 and 2007, we reported on Education's administration of Title
III and V programs and found that it had made limited progress in
implementing initiatives to enhance monitoring of and technical
assistance for grantees.[Footnote 2] In this requested report, we
address the following questions:(1) what are the characteristics of
institutions eligible to receive grants under Titles III and V,
including the characteristics of students served; (2) what challenges
do grantees face, and how have they spent Title III and V funds to
address these challenges; and (3) to what extent does the Department of
Education monitor the financial and programmatic performance of Title
III and V grantees, and use this information to target its technical
assistance?
To describe the characteristics of postsecondary institutions eligible
to receive grants under Titles III and V and the characteristics of
their students, we analyzed the most recent data available from
Education data systems. Specifically, we analyzed 2006 data from
Education's Integrated Postsecondary Education Data System (IPEDS) to
identify institutions eligible to receive Title III and V grants and to
describe both institutional and student characteristics.[Footnote 3]
We also analyzed data from Education's 2004 National Postsecondary
Student Aid Study (NPSAS) to provide additional insight into student
characteristics.[Footnote 4] Because NPSAS data are based on a
representative sample of students enrolled in postsecondary education,
it does not include the universe of institutions as reported in IPEDS.
As a result, it is not possible to discuss the NPSAS data in terms of
eligible and ineligible institutions, as can be done with IPEDS data.
Instead, when discussing NPSAS data, we refer to minority serving and
non-minority serving institutions. While only Historically Black
Colleges and Universities, Hispanic-serving Institutions, and Tribal
Colleges are classified as minority serving institutions for NPSAS,
these data are the most complete source of information on the
characteristics of students attending minority serving institutions. We
determined that IPEDS and NPSAS data are sufficiently reliable for the
purposes of this report by testing it for accuracy and completeness,
reviewing documentation about systems used to produce the data, and
interviewing agency officials. We also conducted a review of the
literature to gain a better understanding of the characteristics of
minority serving institutions and the students they serve. To describe
the challenges that grantees face and how they used grant funds to
address these challenges, we reviewed grant applications and annual
performance reports. Specifically, we conducted a content analysis of
grant applications using a representative sample of 78 of the 511
fiscal year 2006 grantees, allowing us to generalize our findings to
the entire population of grantees with a 95 percent degree of
confidence. Additionally, we analyzed data from annual performance
reports detailing expenditures of fiscal year 2006 grant funds--the
most recent data available--for 503 of 511 fiscal year 2006 grantees
that submitted these data electronically.[Footnote 5] We also
interviewed officials from 27 grantee institutions--including 11
conducted on-site--about the challenges they face and their experiences
with the grant programs. We selected this nonprobability sample based
on program participation, size of grant, and geographic location. To
determine how Education monitors and provides technical assistance, we
conducted interviews with officials at Education and reviewed grant
program requirements, policies, procedure manuals, and monitoring
plans. Finally, we conducted additional site visits at seven grantee
institutions to evaluate their fiscal policies and internal control
practices, and determine whether program funds were properly used.
These institutions were selected using a nonprobability sample based on
factors such as program participation, size of grant, and geographic
location. A more detailed explanation of our methodology can be found
in appendix I.
We conducted this performance audit from September 2007 through June
2009 in accordance with generally accepted government auditing
standards. Those standards require that we plan and perform the audit
to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings and conclusions based on our audit objectives.
We believe that the evidence obtained provides a reasonable basis for
our findings and conclusions based on our audit objectives.
Background:
Title III and Title V of the Higher Education Act (HEA) authorize
federal funding for postsecondary institutions that provide large
proportions of low-income and minority students access to higher
education. In 1965, Congress authorized grant programs[Footnote 6] to
strengthen and support developing postsecondary institutions, leading
to today's Strengthening Institutions Program. This program provides
discretionary grants to help institutions that serve large numbers of
low-income students improve their academic quality, institutional
management, and fiscal stability.[Footnote 7] In subsequent
reauthorizations, Congress established several programs to target grant
funding to certain institutions that serve large numbers of minority
students. Specifically, in 1986, a program was created to designate
formula grant funding for historically black colleges and
universities.[Footnote 8] In 1998, further amendments to the HEA
created new grant programs specifically for tribally controlled
colleges and universities, Alaska Native and Native Hawaiian-serving
institutions, and Hispanic-serving institutions.[Footnote 9] Prior to
these amendments, these institutions competed for funding under the
Strengthening Institutions program. Collectively, these institutions
are referred to as minority serving institutions.
Institutions that participate in the Historically Black Colleges and
Universities and Tribal programs receive mandatory grants based on two
distinct formulas.[Footnote 10] Institutions that participate in all
other programs receive grants based on a ranking of applications by a
competitive peer-review evaluation. Such institutions may apply
individually or as part of a cooperative partnership for development
grants to develop capacity in specified areas on selected campuses.
Institutions that receive cooperative grants partner and share
resources with another postsecondary institution--which may or may not
be eligible for Title III or V funding--to achieve common goals without
costly duplication of effort. In addition to 5-year individual
development and cooperative grants, Title III, Part A and Title V
institutions may apply for a 1-year grant for the purposes of planning
an application for a 5-year grant, 1-year construction grant, or 1-year
renovation grant. Table 1 briefly describes the characteristics and
eligibility criteria of Title III and V programs.
Table 1: Characteristics and Eligibility Criteria of Title III and V
Grant Programs:
Grant program: Title III, Part A, Strengthening Institutions;
Type of grant: Competitive;
Duration: Up to 5 years;
Wait-out period[A]: 2 years;
Eligibility criteria: An institution of higher education which (1) has
an enrollment of needy students--at least 50 percent of students
receive need-based federal financial assistance or its percentage of
students receiving Pell Grants exceeds that of comparable institutions;
(2) has average educational and general expenditures that are low
compared to other institutions that offer similar instruction; (3) is
accredited or making reasonable progress toward accreditation; and (4)
is legally authorized by the state in which it is located to be a
junior college or award bachelor's degrees.
Grant program: Title III, Part A, Tribal Colleges;
Type of grant: Formula noncompetitive[B];
Duration: Up to 5 years;
Wait-out period[A]: None;
Eligibility criteria: Must meet the same eligibility criteria as the
Strengthening Institutions program. Additionally, must meet the
statutory definition of "tribally controlled college or university."
Grant program: Title III, Part A, Alaska Native and Native Hawaiian;
Type of grant: Competitive;
Duration: Up to 5 years;
Wait-out period[A]: None;
Eligibility criteria: Must meet the same eligibility criteria as the
Strengthening Institutions program. Additionally, must have an
undergraduate enrollment of at least 20 percent Alaska Native or at
least 10 percent Native Hawaiian, as applicable.
Grant program: Title III, Part B, Historically Black Colleges and
Universities;
Type of grant: Formula noncompetitive;
Duration: Up to 5 years;
Wait-out period[A]: None;
Eligibility criteria: Any college or university established prior to
1964 and whose principal mission was, and is, the education of African
Americans, and is accredited or is making reasonable progress toward
accreditation.
Grant program: Title V, Part A, Hispanic-Serving Institutions;
Type of grant: Competitive;
Duration: Up to 5 years;
Wait-out period[A]: None;
Eligibility criteria: Must meet the same eligibility criteria as the
Strengthening Institutions program. Additionally, must have an
undergraduate enrollment of full-time equivalent students that is at
least 25 percent Hispanic, of which no less than 50 percent are low-
income individuals. Institutions receiving grant funds through Title V
may not simultaneously receive funds through Title III, Parts A or B.
Sources: Higher Education Act of 1965, as amended, and Department of
Education regulations.
[A] The minimum number of years institutions receiving an individual
development grant must wait before they are eligible to receive another
grant under the same program.
[B] The Tribal College program awarded the first formula grants in
2009.
[End of table]
From fiscal year 1999 to fiscal year 2008, total appropriations for
these programs increased from $230 million to $667 million. In fiscal
year 2008, the range of new annual institutional awards was $172,560
for a 1-year planning grant to $3 million for an individual development
grant (see table 2).
Table 2: Title III and V Funding, Fiscal Years 1999 and 2008 (Dollars
in millions):
Program: Title III, Part A, Strengthening Institutions;
Funding: 1999: $60;
Funding: 2008: $78.
Program: Title III, Part A, Tribal Colleges;
Funding: 1999: 3;
Funding: 2008: 53.
Program: Title III, Part A, Alaska Native/Native Hawaiian Institutions;
Funding: 1999: 3;
Funding: 2008: 20.
Program: Title III, Part B, Historically Black Colleges and
Universities;
Funding: 1999: 136;
Funding: 2008: 323.
Program: Title V, Part A, Hispanic Serving Institutions;
Funding: 1999: 28;
Funding: 2008: 193.
Program: Total;
Funding: 1999: $230;
Funding: 2008: $667.
Source: Department of Education, Budget of the United States
Government--Appendix, Fiscal Year 2001, at 362, Fiscal Year 2010, at
372-73.
[End of table]
The HEA outlines broad goals for Title III and V programs to strengthen
participating institutions but provides institutions flexibility in
deciding what approaches will best meet their needs. An institution can
use the grants to focus on one or more activities to address the
challenges articulated in its comprehensive development plan, which is
required as part of the grant application and must include the
institution's strategy for achieving growth and self-sufficiency. Under
Education's program guidance, institutions are allowed to address
challenges in four broad focus areas: academic quality, student support
services, institutional management, and fiscal stability. More
specifically, funds can be used for activities such as supporting
faculty development; purchasing library books, periodicals, and other
educational materials; hiring tutors or counselors for students;
improving educational facilities; or building endowments. Although each
Title III and V program allows funds to be used in the same broad
areas, there are variations in the rules for allowable activities
across each of the Title III and V programs (see table 3).
Table 3: Comparison of All Title III and V Allowable Activities by
Program:
Allowable activity: Acquisition of scientific or laboratory equipment;
Program: Strengthening Institutions: [Check];
Program: Tribal: [Check];
Program: Alaska Native/Native Hawaiian: [Check];
Program: Historically Black College or University: [Check];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Construction or improvement of instructional
facilities, including the integration of computer technology into
instructional facilities;
Program: Strengthening Institutions: [Check];
Program: Tribal: [Check];
Program: Alaska Native/Native Hawaiian: [Check];
Program: Historically Black College or University: [Check];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Faculty exchange and development for attaining
advanced degrees;
Program: Strengthening Institutions: [Check];
Program: Tribal: [Check];
Program: Alaska Native/Native Hawaiian: [Check];
Program: Historically Black College or University: [Check];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Development and improvement of academic programs;
Program: Strengthening Institutions: [Check];
Program: Tribal: [Check];
Program: Alaska Native/Native Hawaiian: [Check];
Program: Historically Black College or University: [Check];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Purchase of educational materials;
Program: Strengthening Institutions: [Check];
Program: Tribal: [Check];
Program: Alaska Native/Native Hawaiian: [Empty];
Program: Historically Black College or University: [Check];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Tutoring, counseling, and other services to improve
academic success;
Program: Strengthening Institutions: [Check];
Program: Tribal: [Check];
Program: Alaska Native/Native Hawaiian: [Check];
Program: Historically Black College or University: [Check];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Management of funds and administration;
Program: Strengthening Institutions: [Check];
Program: Tribal: [Check];
Program: Alaska Native/Native Hawaiian: [Check];
Program: Historically Black College or University: [Check];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Joint use of facilities;
Program: Strengthening Institutions: [Check];
Program: Tribal: [Check];
Program: Alaska Native/Native Hawaiian: [Check];
Program: Historically Black College or University: [Check];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Establishment or improvement of development office;
Program: Strengthening Institutions: [Check];
Program: Tribal: [Check];
Program: Alaska Native/Native Hawaiian: [Check];
Program: Historically Black College or University: [Check];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Establishment or improvement of an endowment;
Program: Strengthening Institutions: [Check];
Program: Tribal: [Check];
Program: Alaska Native/Native Hawaiian: [Empty];
Program: Historically Black College or University: [Check];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Creation or improvement of facilities for distance
learning capabilities;
Program: Strengthening Institutions: [Check];
Program: Tribal: [Check];
Program: Alaska Native/Native Hawaiian: [Empty];
Program: Historically Black College or University: [Check];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Academic instruction in disciplines for
underrepresented groups;
Program: Strengthening Institutions: [Check];
Program: Tribal: [Check];
Program: Alaska Native/Native Hawaiian: [Empty];
Program: Historically Black College or University: [Check];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Establishment or enhancement of a teacher education
program;
Program: Strengthening Institutions: [Empty];
Program: Tribal: [Check];
Program: Alaska Native/Native Hawaiian: [Empty];
Program: Historically Black College or University: [Check];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Increase the number of underrepresented graduate or
professional students served through expanded courses and institutional
resources;
Program: Strengthening Institutions: [Empty];
Program: Tribal: [Empty];
Program: Alaska Native/Native Hawaiian: [Empty];
Program: Historically Black College or University: [Empty];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Establishing community outreach programs that
encourage elementary and secondary school students to develop the
academic skills and interest to pursue postsecondary education;
Program: Strengthening Institutions: [Empty];
Program: Tribal: [Empty];
Program: Alaska Native/Native Hawaiian: [Empty];
Program: Historically Black College or University: [Empty];
Program: Hispanic Serving Institution: [Check].
Allowable activity: Other activities approved by the Secretary of
Education;
Program: Strengthening Institutions: [Check];
Program: Tribal: [Check];
Program: Alaska Native/Native Hawaiian: [Check];
Program: Historically Black College or University: [Check];
Program: Hispanic Serving Institution: [Check].
Source: GAO analysis of the Higher Education Act.
[End of table]
Title III and V programs are administered by the Institutional
Development and Undergraduate Education Service (IDUES) within
Education's Office of Postsecondary Education (OPE). In addition to the
Title III and V programs we examine in this report, IDUES administers
the Strengthening Historically Black Graduate Institutions, Minority
Science and Engineering Improvement, and the Robert C. Byrd Honors
Scholarships programs. Additionally, in 2007, IDUES assumed
responsibility for several new grant programs for other categories of
minority serving institutions, including Native American-serving
Nontribal Institutions and Asian American and Native American Pacific
Islander-serving Institutions.[Footnote 11] IDUES currently has 32
program staff members to administer more than 1,000 grants across its
portfolio.
The Comptroller General's Domestic Working Group highlights areas of
opportunity and promising practices in grants management--focused both
on ensuring grant funds are spent properly and on achieving their
desired results[Footnote 12] (see table 4). Effective grants management
calls for establishing adequate internal control systems, including
efficient and effective information systems, training, policies, and
oversight procedures, to ensure grant funds are properly used and
achieve intended results.
Table 4: Summary of Opportunities for Improvement in Grants Management:
Areas of opportunity: Internal control systems;
Promising practice issue areas:
* Preparing policies and procedures before issuing grants;
* Consolidating information systems to assist in managing grants;
* Providing grant management training to staff and grantees;
* Coordinating programs with similar goals and purposes.
Areas of opportunity: Preaward process;
Promising practice issue areas:
* Assessing applicant capability to account for funds;
* Competing grants to facilitate accountability;
* Preparing work plans to provide framework for grant accountability;
* Including clear terms and conditions in grant award documents.
Areas of opportunity: Managing performance;
Promising practice issue areas:
* Monitoring the financial status of grants;
* Ensuring results-through-performance monitoring;
* Using audits to provide valuable information about grantees;
* Monitoring subrecipients as a critical element of grant success.
Areas of opportunity: Assessing and using results;
Promising practice issue areas:
* Providing evidence of program success;
* Identifying ways to improve program performance.
Source: Domestic Working Group.
[End of table]
Internal controls provide federal managers with reasonable assurance
that their program is (1) achieving its primary objectives of effective
and efficient operations, reliable financial reporting, and compliance
with applicable laws and regulations; (2) safeguarding assets; and (3)
preventing fraud, waste, abuse, and mismanagement. Like other federal
departments and agencies, Education is expected to implement internal
control systems consistent with the requirements established by the
Office of Management and Budget and GAO.[Footnote 13] Entities that
receive federal funds, such as institutions of higher education, are
also expected to implement effective internal control systems
consistent with federal requirements.
Eligible Institutions Had Fewer Resources to Serve Proportionately More
Students at Academic Risk:
Lower Revenues May Make It Difficult for Eligible Institutions to Meet
Needs of Current and Future Students:
We estimate that 28 percent of 2-year and 4-year public and private not-
for-profit postsecondary institutions are eligible to participate in
the Title III and V programs, and together these institutions enrolled
just over 4 million students. About one-half of all eligible
institutions are 2-year colleges, such as community colleges, compared
to 31 percent of 2-year institutions that are ineligible to participate
in the programs (see table 5). The substantial representation of 2-year
public institutions that are eligible to participate in the programs
appears to amplify some of the overall differences in both
institutional and student characteristics between eligible and
ineligible populations discussed throughout this section.
Table 5: Title III and V Eligibility Status of Postsecondary
Institutions:
Eligible:
2-year public: Number: 400;
2-year public: Percent: 46;
2-year private, not-for-profit: Number: 47;
2-year private, not-for-profit: Percent: 5;
4-year public: Number: 154;
4-year public: Percent: 18;
4-year private, not-for-profit: Number: 277;
4-year private, not-for-profit: Percent: 32;
Total: Number: 878[A];
Total: Percent: 28.
Ineligible:
2-year public: Number: 654;
2-year public: Percent: 29;
2-year private, not-for-profit: Number: 66;
2-year private, not-for-profit: Percent: 3;
4-year public: Number: 489; 4-year public: Percent: 21;
4-year private, not-for-profit: Number: 1,080;
4-year private, not-for-profit: Percent: 47;
Total: Number: 2,289;
Total: Percent: 72.
All institutions:
2-year public: Number: 1,054;
2-year public: Percent: 33;
2-year private, not-for-profit: Number: 113;
2-year private, not-for-profit: Percent: 4;
4-year public: Number: 643; 4-year public: Percent: 20;
4-year private, not-for-profit: Number: 1,357;
4-year private, not-for-profit: Percent: 43;
Total: Number: 3,167;
Total: Percent: 100.
Source: GAO analysis of 2006 IPEDS data.
[A] Postsecondary institutions with branch campuses can decide whether
to report IPEDS data for the entire system or individually for each
branch campus. Totals do not fully account for branch campuses that are
otherwise eligible but did not report as an individual campus into
IPEDS.
[End of table]
Overall, eligible institutions had access to fewer revenue sources,
including endowment holdings and tuition and fees, to serve their
students. Endowments provide additional funds for activities, such as
providing scholarships and constructing facilities, which would be
unaffordable if institutions relied solely on tuition, private
philanthropic gifts, or government funding. The median per-student
endowment holdings at eligible institutions were lower than the
holdings of their ineligible peers. For example, the median per-student
endowment for eligible 4-year private, not-for-profit institutions was
nearly three times less per student ($7,297) than the median for
ineligible 4-year private, not-for-profit institutions ($20,391).
Another major source of revenue for institutions is the tuition and
fees charged to students. For all eligible institutions, the median
tuition and fees reported were lower than what was reported at
ineligible institutions. Median tuition and fees at eligible
institutions were 12 percent less than at ineligible institutions for 2-
year private, not-for-profit institutions, and 38 percent less at 4-
year private, not-for-profit institutions.
Lower revenues may limit an institution's ability to undertake
activities that build institutional capacity, such as improving campus
facilities and enhancing academic offerings. In 2006, per-student
spending on instructional equipment at eligible institutions was almost
47 percent less than spending at ineligible institutions. Eligible
institutions also spent almost 60 percent less per student on expenses
related to day-to-day operations, such as financial aid and
registration, and about two times less per student on certain services,
such as providing technology in classrooms and activities related to
student life and development.
While eligible institutions had lower revenues and per-student
spending, they more often had admissions policies associated with the
enrollment of students who need greater academic support. Research has
shown that students attending institutions that accept any student who
applies for admission--known as open-enrollment institutions--are less
likely to be prepared to successfully undertake college-level
coursework. About 60 percent of eligible institutions had open
enrollment, compared to 35 percent of ineligible institutions. Almost
all 2-year public institutions--both eligible and ineligible--reported
open enrollment policies, which is consistent with the mission most
community colleges have to work with students of all ability levels.
Open-enrollment policies were much less common at eligible 4-year
institutions. Less than 30 percent of these schools had open
enrollment, but it was still more prevalent than at ineligible 4-year
institutions, of which 10 percent or less had such policies.
Limited revenues may also impact the ability of eligible institutions
to meet the demand of future students based on population projections.
Specifically, about two-thirds of eligible institutions are located in
southern and western states, many of which are projected to experience
an increase in the number of college-age students in coming years (see
figure 1). Studies also project long-term growth in the number of
minority and low-income high school graduates in these two regions
beginning in 2015 and extending through 2022, driven in part by
accelerated growth in the Hispanic population.[Footnote 14] Given the
importance many students enrolled at minority-serving institutions
place on geographic proximity to home when choosing a college, eligible
institutions in high-growth states could experience proportionately
more growth in numbers of students and changes in the demographics of
the college-age population may result in an expansion in the number of
eligible institutions. For example, a 2008 Education study found that
in some states including Texas, Arkansas, and North Carolina, over 80
percent of entering freshmen are state residents.[Footnote 15]
Additionally, Education's 2004 NPSAS survey found that 80 percent of
students enrolled at Hispanic-serving institutions and almost 73
percent of students enrolled at Historically Black Colleges and
Universities stated that geographic location was a key reason for
selecting their postsecondary institution.
Figure 1: Location of Institutions Currently Eligible for Title III and
V Funding and Projected Change in College-Age Minority Population by
2015:
[Refer to PDF for image: map of the United States]
Projected percentage change in total college-age minority population by
2015: (Number of Title III and V eligible institutions in states,
territories, and commonwealths in parenthesis)
Less than 0 percent (negative projected growth):
Alaska (4);
Connecticut (4);
Hawaii (3);
Illinois (37);
Kansas (11);
Louisiana (14);
Maine (9);
Maryland (8);
Massachusetts (14);
Michigan (12);
Minnesota (8);
Montana (10);
Nebraska (5);
New Hampshire (2);
New York (73);
North Dakota (7);
Ohio (31);
Pennsylvania (22);
Puerto Rico (48);
Rhode Island (0);
South Dakota (8);
Vermont (2);
Virgin Islands (1);
West Virginia (13);
Wisconsin (9);
Wyoming (1).
0.01 to 5 percent:
California (81);
Mississippi (21);
Missouri (13);
New Mexico (20);
Oregon (9);
Washington (13).
5.01 to 10 percent:
Alabama (29);
District of Columbia (3);
Iowa (14);
Kentucky (26);
Oklahoma (17);
South Carolina (21);
Virginia (25).
10.01 to 20 percent:
Colorado (9);
Delaware (1);
Georgia (21);
Indiana (8);
New Jersey (11);
Tennessee (15);
Greater than 20 percent:
Arizona (11);
Arkansas (26);
Florida (24);
Idaho (1);
Nevada (0);
North Carolina (34);
Texas (62);
Utah (1).
Source: GAO analysis; Map Resources (map).
Note: Demographic projection data were not available for U.S.
territorial and commonwealth holdings.
[End of figure]
Eligible Institutions Enrolled More Minority and Low-Income Students
Than Ineligible Institutions:
On average, eligible institutions enrolled more minority students than
ineligible institutions. In 2006, about one-half of all students
enrolled at eligible institutions were minority, compared to about one-
quarter at ineligible institutions (see figure 2). While eligible
institutions represent 28 percent of all postsecondary institutions,
they enrolled over 43 percent of all minority students. Eligible
institutions were largely comprised of the minority group associated
with their program eligibility. For example, at Historically Black
Colleges and Universities the predominant student population was
African American, and at Hispanic-serving institutions, it was
Hispanic. Almost 60 percent of all students enrolled at eligible and
ineligible institutions were women.
Figure 2: Race and Ethnicity, by Eligibility Status, 2006:
[Refer to PDF for image: two pie-charts]
Racial/ethnic composition of eligible institutions (percentage of
enrollment):
Non-Hispanic White: 45%;
Total, all minority: 48%:
- African American: 18%;
- Hispanic: 22%;
- Native American: 1%;
- Asian: 6%;
Nonresidents: 2%;
Other: 5%.
Racial/ethnic composition of ineligible institutions (percentage of
enrollment):
Non-Hispanic White: 67%;
Total, all minority: 24%:
- African American: 9%;
- Hispanic: 8%;
- Native American: 1%;
- Asian: 6%;
Nonresidents: 2%;
Other: 7%.
Source: GAO analysis of Department of Education 2006 IPEDS data.
Note: The sum of individual race/ethnicity percentages may not equal
total minority enrollment due to rounding.
[End of figure]
Eligible institutions also served more low-income students, a central
requirement for participation in Title III and V programs.
Specifically, 44 percent of students enrolled at eligible institutions
received Pell grants compared to 26 percent at ineligible institutions.
[Footnote 16] In addition, eligible institutions reported that half of
all first-time, full-time students enrolled received some form of
federal student aid, compared to 25 percent of students enrolled at
ineligible institutions.[Footnote 17]
Students at eligible institutions also may have characteristics that
put them at academic risk, including attending part-time and delaying
their enrollment following high school. In 2006, 47 percent of students
at eligible institutions attended part-time compared with 34 percent of
students at ineligible institutions. This difference is largely driven
by the substantial proportion of 2-year public institutions in the
eligible population. At both eligible and ineligible 2-year public
institutions, more than 60 percent of students attended part-time. In
particular, about two-thirds of students attending both eligible and
ineligible 2-year public, Hispanic-serving institutions attended part-
time. At 4-year institutions, rates of part-time attendance were much
lower. However, eligible institutions enrolled more part-time students
than ineligible institutions: 29 percent of students at eligible 4-year
public institutions attended part-time, compared to 19 percent at
ineligible 4-year public institutions. One possible explanation for the
difference in part-time enrollment may be related to the extent to
which a student works while enrolled. According to Education's 2004
NPSAS survey, almost 40 percent of students attending minority serving
institutions worked 35 hours or more per week and considered themselves
as employees enrolled in college instead of students who work, when
compared to students attending non-minority serving institutions.
A greater percentage of students at eligible institutions delayed
enrollment in college than students at ineligible institutions.
Research has shown, however, that students who delay enrollment are at
greater risk of not completing a postsecondary credential, as compared
to their peers who enroll soon after completing high school. At 4-year
private, not-for profit institutions, for example, 34 percent of
students at eligible institutions compared to 21 percent at ineligible
institutions enrolled in college for the first time when 25 or older.
Rates at 2-year public colleges were similar with more than 40 percent
of students at eligible and ineligible institutions enrolling for the
first time at age 25 or older. One exception to this trend among
eligible institutions was students at Historically Black Colleges and
Universities, where almost three-quarters of the students enroll right
after high school.
Eligible institutions had lower retention rates, on average, than
ineligible institutions.[Footnote 18] For example, in 2006, eligible
institutions retained 60 percent of their full-time students compared
to 69 percent at other institutions. Research has shown that a number
of factors, including attending part-time, working full-time, and
delaying enrollment in college for more than a year after high-school,
put students at a greater risk of leaving postsecondary education
without a credential.[Footnote 19] The retention rate for 2-year public
institutions was lower, but similar, at eligible and ineligible
institutions. Graduation rates were lower as well.[Footnote 20]
Specifically, 39 percent of students at eligible 4-year institutions
received a bachelor's degree within 6 years of enrolling, compared to
60 percent of students at ineligible 4-year institutions. According to
a recent Education study, graduation rates may decline as the
percentage of an institution's low-income student population increases.
[Footnote 21] This may be for a variety of reasons, including a
student's academic preparation, working full-time while enrolled,
parents' educational attainment, as well as an institution's
selectivity in admissions. However, the report also found that several
highly selective minority serving institutions enrolled a significant
number of low-income students and were high performers with respect to
graduation. Another possible explanation for the difference in
graduation rates may also be tied to institutional expenditures. One
study reported that those institutions with lower expenditures on
student support services had lower graduation rates.[Footnote 22]
Graduation rates for both eligible and ineligible 2-year public
institutions were similar; however, the relevance of graduation rates
at 2-year institutions has been widely debated since students may
enroll in these institutions for a variety of reasons other than
completing a degree or certificate program. See appendix II for more
information on institutional and student characteristics.
Institutions Faced Challenges across the Grant Programs' Four Focus
Areas but Spent Most of Their Funds in Two Areas, Academic Quality and
Student Support:
In their grant applications, Title III and V grantees reported
challenges across all four grant focus areas: academic quality, student
support, institutional management, and fiscal stability. According to
data collected through Education's annual performance reports, fiscal
year 2006 grantees reported spending almost $385 million in total grant
funds on activities across all four focus areas, with over three-
quarters of the funds expended in the areas of academic quality and
student support services (see figure 3). See appendix III for
additional information on Title III and V expenditures of grant funds
for fiscal years 2002 to 2006.
Figure 3: Fiscal Year 2006 Grantee Expenditures by Focus Area:
[Refer to PDF for image: pie-chart and horizontal bar graph]
Percentage of total dollars, by focus area:
Academic quality: 43%;
Student support: 34%;
Institutional management: 17%;
Fiscal stability: 6%.
Percentage of grantees undertaking at least one activity, by focus
area:
Academic quality: 57%;
Student support: 66%;
Institutional management: 28%;
Fiscal stability: 27%.
Source: GAO analysis of Department of Education fiscal year 2006 annual
performance report data.
[End of figure]
Academic Quality:
Based on our review of a representative sample of grant applications,
we estimate that all grantees reported challenges in improving academic
quality, such as recruiting and training highly qualified faculty,
using the latest technology in the classroom for instruction, improving
academic space, and tailoring courses to student needs. Fifty-seven
percent of fiscal year 2006 grantees dedicated at least one activity to
improving academic quality, and expenditures in this focus area
represented about 43 percent of total grant funds spent. Specific
examples of how institutions used grant funds to address academic
quality challenges follow:
* A 2-year Alaska Native institution seeking to provide access to
students in seven remote villages--covering roughly 88,000 square
miles--began offering classes online. However because access to
computers and high-speed Internet in the villages was costly,
unreliable, or nonexistent, most lesson plans limited the use of
multimedia. By leveraging its Title III grant with funds from the
Department of Housing and Urban Development's Assisting Communities
program, the school obtained wireless capability and now offers 8 to 12
online courses each semester.
* A 4-year Native Hawaiian institution said that it has struggled to
provide science instruction to students due to outdated laboratory
facilities. These facilities were reportedly so antiquated that the
television show "Lost" used the facilities to replicate a 1950s
laboratory. The institution leveraged $2.3 million in Title III grant
funds to renovate 12,000 square feet of un-air-conditioned, termite-
damaged laboratory space that did not comply with federal safety and
health regulations (see figure 4).
Figure 4: Before-and-After Photos of Science Facilities on Native
Hawaiian Campus:
[Refer to PDF for image: photographs]
Source: Chaminade University, Honolulu, Hawaii.
[End of figure]
Student Support Services:
Nearly all grantees reported difficulty providing student support
services, including remedial courses, tutoring, and academic
counseling. Many of these grantees reported that the unique needs of
their students underscore the importance of providing student support
services. Over three-quarters of grantees cited difficulties associated
with retaining and graduating their students, which most attributed to
incoming students arriving underprepared for college-level course work.
Two-thirds of fiscal year 2006 grantees reported dedicating at least
one activity to improving student support services, and expenditures in
this area represented 34 percent of total Title III and V grant funds
spent. Most of these expenditures were for tutoring and counseling.
Specific examples of how institutions used grant funds to address
student support challenges follow:
* A 2-year strengthening institution in Illinois reported in 2005 that
75 percent of its first-year students were at risk of leaving college
without a degree because the institution could not provide adequate
academic support and advisement. To reduce the likelihood that students
would fail or drop out, the school reported spending $360,000 in grant
funds to provide training to 175 faculty members on the use of
multimedia and technology, active learning, and strategies to support
various learning styles. Additionally, all 46 of its academic advisors
were provided training in techniques for advising students with
different learning styles.
* A 2-year Hispanic-serving institution in Texas reported using almost
$350,000 in fiscal year 2006 grant funds to conduct an outreach program
at area high schools for students at risk of dropping out without
earning a diploma, as well as to provide bilingual financial aid
services to better serve its students. By providing support services to
students while they are in high school, the college aims to improve
high school graduation and college enrollment rates in Dallas County
high schools where 63 percent of Hispanic and 52 percent of African
American students left high school in 2001 without a diploma. The
outreach program provides students with career exploration courses in
math, science, and technology, as well as peer mentors who are enrolled
in 4-year colleges or universities. College officials credit the 5-year
Title V grant as contributing to a 12 percent increase in students
pursuing postsecondary education and a 45 percent increase in the
number of associate degrees awarded between 2004 and 2007.
* A 2-year tribal college in South Dakota reported it relied on faculty
and staff to provide additional tutoring and counseling support to at-
risk students because it lacked resources to fully address student
needs. Because almost all of its students come from low-income
families, or are the first in their families to attend college,
additional support could only be provided for one-third of the students
in need. According to school officials, in fiscal year 2006, the school
spent nearly $32,000 of its Title III grant to hire additional staff
and peer mentors to provide tutoring and counseling services for 120
additional students, an increase of 169 percent.
Institutional Management:
Nearly all grantees reported institutional management challenges,
including recruiting and retaining qualified staff, updating technology
on campuses, addressing administrative challenges such as financial aid
or student registration, undertaking strategic planning, or tracking
student performance. Twenty-eight percent of all fiscal year 2006
grantees funded at least one activity in this area, and expenditures on
institutional management represented about 17 percent of total grant
funds spent. Specific examples of how institutions used grant funds to
address institutional management challenges follow:
* A 2-year Alaska Native-serving institution reported significant
staffing shortages due to its isolated location, and its staff had to
perform a variety of jobs. For example, the business office director
also occasionally performs building and grounds maintenance tasks, such
as shoveling sidewalks and handling computer problems. Additionally, a
staff member assigned to manage the bookstore was also responsible for
providing financial aid advice. While it is not possible to address all
challenges with Title III funds, the grant was a critical first step in
establishing four full-time financial aid positions that have since
become part of the college's budget.
* A 4-year historically black university in North Carolina that ranks
high nationally in the production of computer science graduates
reported it has difficulty maintaining its ongoing investment in its
technology infrastructure. After spending $1.2 million of Title III
funds in 2000, the college used an additional $834,000 from subsequent
Title III grants to upgrade telecommunications, implement Web-enabled
administrative software, and increase classes with wireless
capabilities by 34 percent.
* A 4-year Hispanic-serving institution in Puerto Rico said its ability
to expand is limited by its location in an historic building that
cannot be altered, hindering service to the island's growing college-
age population. While delays in obtaining construction permits have
limited the college's progress, the college is completing renovations
for a new academic building. It has spent $740,000 in grant funds to
renovate its library, increasing the space dedicated to this building
by 32,000 square feet.
* A tribal college in South Dakota reported using more than $85,000 in
grant funds to develop a comprehensive training program for its grants
management staff to address internal control weaknesses identified by
federal auditors. According to school officials, auditors reported that
prior practices resulted in $2.3 million in federal grants at risk of
fraud, waste, and abuse. In 2006, the college used grant funds to
create a Human Resources Office, increase its administrative staff from
four to six and provide them with training, and post its internal
control policies and practices online. Officials reported that a
federal agency that rescinded a $50,000 grant award in 2005 later
returned the grant upon completion of these activities.
* A 4-year historically black college in Tennessee reported spending
$101,795 in Title III funds to strengthen institutional management by
developing an operating manual and providing training for members of
its Board of Directors. A school official told us that most board
members do not have professional experience related to higher education
administration, and their staggered 3-year terms result in new members
joining the board periodically.
Fiscal Stability:
We estimate that nearly all grantees reported fiscal stability
challenges, including decreases in state and local government funding,
an overreliance on tuition-based revenue, and lack of donations from
private sources. Twenty-seven percent of fiscal year 2006 grantees
funded at least one activity in this focus area, and fiscal stability
expenditures represented 6 percent of all grant funds spent. Specific
examples of how institutions used grant funds to address fiscal
stability challenges follow:
* A 2-year strengthening institution in Iowa cited declining state
funding as a challenge, reporting that in 2002, it fell below other
Iowa community colleges in per-credit hour funding from the state and
was forced to raise tuition and fees. Officials said many of its
students are low-income and cannot pay more. As a result, the college
ranks last among Iowa community colleges in general fund balance,
threatening its long-term viability. To address these challenges, the
college established three new academic programs--dental hygiene,
biotechnology, and advanced manufacturing--that are in high demand in
the surrounding community. The dental hygiene and biotechnology
programs are anticipated to provide the college with an additional
$200,000 in revenues annually and $1 million in federal and state
appropriations.[Footnote 23]
* Officials at a tribal college in South Dakota reported that despite
having a large, active donor list of 40,000, the college lacked staff
with the requisite skills to request major gifts from these donors. The
college reported using $170,000 in Title III grant funds to improve
operations at its development office by acquiring software to track
such information as donor giving history and by centralizing its direct
mail operations for requesting gifts. Additionally, nearly 20 percent
of its $2.5 million grant was used to increase its existing endowment
of $13 million.
Long-standing Deficiencies in Grant Monitoring and Technical Assistance
Limit Education's Ability to Ensure That Funds Are Used Properly and
Grantees Are Supported:
Education Has Made Limited Progress in Improving Its Monitoring, and
Still Lacks a Systematic Approach to Coordinate Its Efforts:
Five times since 1996, GAO and Education's Inspector General have
recommended that Education implement a systematic approach to
monitoring to better assess the fiscal and programmatic performance of
Title III and V grantees. Such an approach would include implementing
formal monitoring and technical assistance plans based on risk models
and developing written procedures for providing technical assistance.
When we previously reported on Education's management of the programs
in 2004, the department had begun several initiatives to improve
monitoring, including the development of annual monitoring plans to
identify potential risk with grants and guide the work of program
staff. However, we found that the lack of progress it made in
implementing these initiatives had resulted in uneven monitoring of
Title III and V grantees.[Footnote 24] Accordingly, we recommended that
Education take steps to ensure its monitoring plans were carried out
and targeted toward at-risk grantees by completing its electronic
monitoring system and training programs. While Education has taken some
steps to better target its monitoring plans in response to our
recommendation, many of its initiatives have yet to be fully realized
(see table 6).
Table 6: A Comparison of the Status of Education's Monitoring
Initiatives in 2004 and 2008:
Monitoring initiative: Implement electronic monitoring system;
2004 status: Education implemented electronic monitoring of Title III
and V grantees at the end of 2004;
2008 status: Redesigned in fiscal year 2007 because the original system
did not achieve its intended goal of presenting a comprehensive view of
risk based on an institution's portfolio of higher education grant
programs. The new system, while fully operational, will continue to be
enhanced through fiscal year 2010.
Monitoring initiative: Establish risk-based criteria;
2004 status: Education's OPE developed risk-based criteria in fiscal
year 2003, but used these criteria inconsistently within the program
office;
2008 status: OPE established preliminary risk-based criteria for all
its grant programs in fiscal year 2008. Criteria have been used to
create a monitoring index of schools on which to focus additional
monitoring, but only a small portion of these criteria are being
utilized to set priorities.
Monitoring initiative: Develop monitoring plans;
2004 status: Following a fiscal year 2002 effort to place greater
emphasis on performance monitoring for all grantees, annual monitoring
plans were developed to guide monitoring and technical assistance;
2008 status: Once the requirement to submit these plans to Education's
OPE was rescinded in 2006, the program office ceased to develop
monitoring plans.
Monitoring initiative: Design comprehensive approach to site visits;
2004 status: While program staff were required to complete at least two
site visits annually, the majority of staff did not fulfill the
requirement. Site visits that were conducted lacked a standard approach
and varied in quality;
2008 status: The requirement for program officers to complete a minimum
number of site visits has been eliminated. Since 2004, few site visits
have been completed, and most of those did not include financial
monitoring to determine whether program funds were properly used.
Monitoring initiative: Develop training for enhanced monitoring;
2004 status: Education developed a corrective action plan to provide
additional courses over a 3-year period to address training needs of
its staff;
2008 status: Education has developed courses to enhance monitoring, but
most staff have not completed coursework and one key course has yet to
be offered.
Source: GAO analysis.
[End of table]
In 2007, the Office of Postsecondary Education (OPE) reestablished an
office to oversee monitoring across all of its higher education grant
programs. The program oversight staff is responsible for overseeing OPE
monitoring policies, procedures, and standards, and training staff in
these areas. The establishment of the oversight staff was designed to
increase consistency in monitoring practices throughout more than 40
grant programs administered by OPE, including Title III and V programs,
and to supplement the responsibilities of individual program offices
with regard to monitoring and technical assistance.
Electronic Monitoring System:
In 2007, Education redesigned its electronic monitoring system to
provide several key enhancements lacking in the system that was
originally introduced 4 years earlier. The original system was not
designed to share key information across grant programs administered by
OPE. The redesigned system brings together information about an
institution's performance in managing its entire portfolio of higher
education grants, increasing Education's ability to assess the risk of
grantee noncompliance with program rules. Program officers can also
enter updates about a grantee's performance in the system, based on
routine interactions with the grantee. According to Education
officials, this information can be used to reflect real-time
information about institutional behavior. Because the system integrates
financial and programmatic data, such as institutional drawdown of
grant funds and annual performance reports, staff will have ready
access to information needed to perform monitoring tasks. Given that
each program officer is responsible for managing around 50 grants,
electronic monitoring, if fully integrated into the oversight
activities of program staff, has the potential to improve the quality
and consistency of monitoring.
Another feature of the system is a monitoring index, implemented in
2008, that determines an institution's need for heightened monitoring
or technical assistance based on nine weighted criteria designed to
assess risk related to an institution's ability to manage its grants
(see figure 5). For example, an institution that has lost accreditation
(30 percent of the index) or has grants totaling more than $30 million
(5 percent of the index) is automatically prioritized for heightened
monitoring, which may involve site visits or other contacts with the
school. Education has identified over 130 institutions across all
higher education grant programs for heightened monitoring, of which 43
percent participate in the Title III and V programs. Education
officials said they will review the criteria and make revisions, as
necessary, to better assess risk.
Figure 5: Monitoring Index Criteria Used to Assess Institutional Risks:
[Refer to PDF for image: pie-chart and sub-chart]
Accreditation status: 30%;
Decline in enrollment by 25 percent: 15%;
Past operating deficit: 15%;
Independent audits with findings: 15%;
Fund not completely expended during grant cycle: 5%;
Total number of higher education grants: 5%;
Other: 15%:
- Total grant funds exceeded $30 million: 5%;
- Number of earmarks held: 5%;
- Institutional matches required: 5%.
Source: GAO analysis of Department of Education data.
[End of figure]
Annual Monitoring Plans:
While Education has made recent progress in automating its monitoring
tools and developing risk-based criteria, it lacks a coordinated
approach to guide its monitoring efforts. Specifically, Education
officials told us they discontinued the development of annual
monitoring and technical assistance plans for Title III and V programs,
one of the initiatives that we reported on in 2004. In 2002, Education
directed each program within the agency to develop a monitoring plan to
place greater emphasis on performance monitoring for all grantees. In
addition to asking whether grantees were achieving results, program
officials were also to consider what assistance Education could provide
to help grantees accomplish program objectives and incorporate an
increased departmental emphasis on compliance with the law into their
planning. Education developed a plan for Title III and V programs that
called for staff to (1) conduct risk assessments, (2) perform a minimum
number of site visits each year, and (3) follow up with grantees
regarding their performance reports. However, in 2006, Education
rescinded the requirement for each program office to submit annual
monitoring plans because the practice did not achieve its intended
purpose of better targeting its monitoring resources. Since then, OPE
has not developed any plans to guide its monitoring activities for
Title III and V programs, although such plans are in place for other
OPE grant programs.
Site Visits:
Since our 2004 report, site visits to Title III and V grantees, a
critical component of an effective grants management program, have
declined substantially. For example, Education conducted 26 site visits
in fiscal year 2003, but only visited 22 grantees over the 4-year
period of fiscal year 2005 through fiscal year 2008 (see table 7). We
were unable to fully determine the nature or quality of these site
visits because Education could not account for most of the reports
required to document site visit findings. Additionally, since the
issuance of our 2004 report, which found that about three-quarters of
the program staff were not meeting the requirement to complete at least
two site visits per year, Education has discontinued the two site visit
requirement. Instead Education officials said they have changed the
focus to improve the quality of monitoring by relying on the risk
criteria to target grantees most in need of site visits to make the
best use of the department's limited resources.
Table 7: Site Visits to Title III and V Grantees, Fiscal Years 2003
through 2008:
Program: Title III, Part A, Strengthening Institutions;
2003: 14;
2004: 14;
2005: 1;
2006: 7;
2007: 0;
2008: 1.
Program: Title III, Part A, Alaska Native/Native Hawaiian Institutions;
2003: 7;
2004: 0;
2005: 0;
2006: 0;
2007: 0;
2008: 0.
Program: Title III, Part A, Tribal Colleges;
2003: 0;
2004: 3;
2005: 3;
2006: 0;
2007: 0;
2008: 0.
Program: Title III, Part B, Historically Black Colleges and
Universities;
2003: 1;
2004: 0;
2005: 2;
2006: 3;
2007: 0;
2008: 4.
Program: Title V, Part A, Hispanic Serving Institutions;
2003: 4;
2004: 1;
2005: 1;
2006: 0;
2007: 1;
2008: 0.
Program: Total;
2003: 26;
2004: 18;
2005: 6;
2006: 10;
2007: 1;
2008: 5.
Source: GAO analysis of Department of Education data.
Note: As of April 2009, Education had completed six site visits for
fiscal year 2009 to an equal number of Strengthening Institutions,
Historically Black Colleges and Universities, and Hispanic Serving
Institutions.
[End of table]
One former senior Education official told us that site visits had
declined because the program office has limited staff and few have the
requisite skills to conduct financial site visits. According to
Education, the OPE office responsible for administering Title III and V
grant programs currently has 32 staff to monitor more than 1,000 grants
across its assigned programs, compared to 2003 when it had 38 staff
responsible for approximately 750 grants. To address concerns that
program officers do not have the right skill mix to conduct
comprehensive site visits, OPE's program oversight staff assumed
responsibility for conducting site visits for Title III and V programs
in 2008. However, because the office is responsible for conducting site
visits across more than 40 higher education grant programs, the number
of Title III and V grantees it can visit will be limited. In fiscal
year 2008, for example, five site visits that program oversight staff
conducted were to Title III grant recipients.
With the implementation of an electronic monitoring system and risk-
based monitoring index, Education now has tools to enhance its ability
to select grantees for site visits. However, officials said that aside
from referrals from the Inspector General, the criteria they used in
selecting schools for fiscal year 2008 and 2009 site visits was the
total amount of higher education grants awarded (i.e., grantees
receiving $30 million or more), which represents only 5 percent of the
monitoring index criteria. In fiscal year 2008, this limited criteria
resulted in a narrow subset of schools being visited, with four of the
five site visits being made to Historically Black Colleges and
Universities. Ideally, Education's risk-based approach would consider
not only grant amounts, but also the full list of weighted criteria on
its monitoring index, along with other factors such as grant program
participation and institution type to ensure that risk is considered
across each of the grant programs and a mix of schools are visited.
Staff Training:
Education has made progress in developing grant monitoring courses to
enhance the skills of Title III and V program staff, but skill gaps
remain and limit the ability of program staff to fully carry out their
monitoring and technical assistance responsibilities. Since our 2004
report, Education has developed courses on internal control and grants
monitoring, but these courses have been attended by less than half of
the program staff. For example, of 28 staff members only 2 have
completed a new internal control course and 13 have completed a course
on grants monitoring. Senior officials at Education we spoke to also
identified critical areas where additional training is needed.
Specifically, one official told us that the ability to conduct
comprehensive reviews of grantees has been hindered because program
staff have not had training on how to review the financial practices of
grantees. A course on this topic was developed in 2007 but has yet to
be offered. Another official said Education needs to provide training
for program staff on how to incorporate the results of the external
evaluations that grantees are required to complete into their reviews.
Education Lacks Assurance That Grant Funds Are Used Appropriately:
Education has not fully implemented its planned monitoring initiatives
and lacks assurance that grantees appropriately manage federal funds,
increasing the potential for fraud, waste, or abuse. During the course
of this study, we reviewed financial and grant project records at seven
institutions participating in Title III and V programs in fiscal year
2006. We identified $142,943 in questionable expenses at 4 of 7
institutions we visited[Footnote 25] (see table 8).
Table 8: Summary of Findings from Financial Site Visits:
Grantee: A;
State: Texas;
Total dollars reviewed: $300,438;
Questionable grant expenses: $2,127.
Grantee: B;
State: Puerto Rico;
Total dollars reviewed: $353,963;
Questionable grant expenses: $29,258.
Grantee: C;
State: Illinois;
Total dollars reviewed: $226,670;
Questionable grant expenses: [Empty].
Grantee: D;
State: Maryland;
Total dollars reviewed: $427,180;
Questionable grant expenses: $105,117.
Grantee: E;
State: Tennessee;
Total dollars reviewed: $175,388;
Questionable grant expenses: [Empty].
Grantee: F;
State: California;
Total dollars reviewed: $108,977;
Questionable grant expenses: $6,441.
Grantee: G;
State: North Dakota;
Total dollars reviewed: $299,846;
Questionable grant expenses: [Empty].
Grantee: Total;
Total dollars reviewed: $1,892,462;
Questionable grant expenses: $142,943.
Source: GAO analysis of grantee disbursement records conducted during
site visits.
[End of table]
At one institution, we identified significant internal control
weaknesses and $105,117 in questionable expenditures. Specifically, a
review of grant disbursement records for Grantee D revealed spending
with no clear linkage to the grant and instances in which accounting
procedures were bypassed by grant staff at the institution. Of the
questionable expenditures we identified, $88,195 was attributed to an
activity designed to promote character and leadership development. Of
that amount, we found that the institution used more than $79,975 to
pay for numerous student trips to locations such as resorts and
amusement parks. According to the grant agreement, the funds were to be
used for student service learning projects. Additionally, $4,578 in
grant funds was used to purchase an airplane global positioning system
even though the school did not own an airplane. Over $6,000 of grant
funds was used to purchase a desk and chair (see figure 6). In
purchasing the global positioning system and office furniture, a school
official split the payments on an institutionally issued purchase card
to circumvent limits established by the institution. Officials at the
institution ignored multiple warnings about mismanagement of this
activity from external evaluators hired to review the grant. Education
visited the school in 2006 but found no problems, and recommended we
visit the institution as an example of a model grantee. We referred the
problems we noted at this institution to Education's Inspector General
for further investigation.
Figure 6: Desk and Chair Purchased by Grantee:
[Refer to PDF for image: photograph]
Source: GAO.
[End of figure]
Examples of the questionable expenditures we identified at three other
institutions we visited follow:
* We were unable to complete testing for about $147,000 of grant fund
transactions at Grantee A due to a lack of readily available supporting
documentation. For one transaction that was fully documented, the
grantee improperly used $2,127 in grant funds to pay late fees assessed
to the college. Once we pointed out that grant funds cannot be used for
this purpose, the college took corrective action by writing a check to
reimburse the grant.
* Grantee B used $27,530 to prepay subscription and contract services
that would be delivered after the grant expired.
* Grantee F used more than $1,500 in grant funds to purchase fast food
and over $4,800 to purchase t-shirts for students.
We presented Education with the results of our analysis supporting each
of our findings related to our grantee visits, and senior officials
expressed commitment to follow up on each of the findings in
coordination with grantees.
The annual performance reports that grantees are required to submit to
receive continued funding provide a key tool for monitoring grantee
performance, but we found evidence that the program office is not
consistently reviewing these reports. In reviewing seven annual
performance reports that fiscal year 2006 grantees submitted late, we
found six that lacked detail, provided inaccurate information, or were
incomplete. For example, one grantee reported that 80 percent ($2.3
million) of total funds allotted for the year were committed to "other
unspecified activities" instead of clearly listing how the funds were
spent, as required. Another institution in the final year of its grant
submitted a report that was mostly blank, but it was counted as
complete by program staff until we pointed out the discrepancy. The
lack of information provided by the institution limits OPE's ability to
follow administrative requirements for closing the grant, and it also
significantly impairs its ability to understand the impact federal
funds had on this particular campus or whether funds were used
appropriately. Education subsequently requested that the school
finalize its performance report a full year after it was originally
due. While such reports will now be easily accessible through the
electronic monitoring system, program staff will still have to take the
initiative to review the information to determine whether grantees have
demonstrated adequate progress to justify continued funding.
Education's Ability to Target Technical Assistance Remains Limited:
While Education provides technical assistance for prospective and
current Title III and V grantees through preapplication workshops and
routine interaction between program officers and grant administrators
at the institutions, it has not made progress in developing a
systematic approach to target the needs of grantees. According to one
senior Education official, technical assistance is generally provided
to Title III and V grantees on a case-by-case basis at the discretion
of program officers. There are no particular criteria to determine when
a program officer should provide technical assistance. For example,
officials at a few of the institutions we spoke to told us that
Education should provide technical assistance whenever the grant
administration staff at an institution changes. Another senior
Education official said that technical assistance should be provided
when annual performance reports show numerous grantees experiencing
similar problems, or if program officers receive numerous calls on a
particular issue. Since we found evidence that program staff may not
consistently review these reports, the extent to which this type of
follow-up is occurring is unclear.
According to grantees we interviewed, the technical assistance
Education provides is not consistent throughout the grant cycle.
Specifically, several officials from schools at which we conducted
interviews were complimentary of the technical assistance Education
provided when they were applying for grants. Some of those officials,
however, noted a precipitous drop in assistance during the first year
after grants were awarded when grantees often need help with
implementation challenges, such as recruiting and retaining highly
qualified staff, securing matching funds for endowments, and overcoming
construction delays. In the past, grantees had an opportunity to
address such challenges at annual conferences sponsored by Education,
but these conferences have not been held since 2006. Nearly 40 percent
of the 113 grantees that provided comments in their annual performance
reports requested that Education resume providing the conferences on a
regular basis. According to Education officials, resource constraints
have prevented them from holding the conferences, but plans are under
way to hold a conference in fall 2009. Since Education stopped
convening conferences, schools, and in some cases higher education
advocacy groups, have hosted conferences at which Education staff
participated. For example, five conferences or workshops held for the
Title V program in 2008 were hosted by schools or advocacy groups.
Officials from a few schools we interviewed said it is important for
Education to take the lead in planning conferences to ensure that
grantees receive information that is consistent with program rules.
They also noted that when conferences were held in locations such as
Washington D.C., participation could be expensive and suggested
Education consider holding regional conferences to make it more
affordable for grantees to attend.
Officials from about half of the schools and some officials from
advocacy groups we interviewed also reported that Education could
strengthen grantee performance by more broadly disseminating
information about successful projects. Education has included limited
information on its Web site about six current and past projects.
However, the information for each project is maintained on the specific
Title III or V program pages, rather than being presented in a
centralized location for the benefit of all grantees. For example, one
of the projects that highlighted student retention efforts at a Native
Hawaiian institution, a topic that has wide applicability across the
grant programs, was only located at the Strengthening Institutions
Program Web site. Additionally, this Web information did not
consistently include contact information to allow interested schools to
contact the featured grantees. School officials said such information
sharing would provide lessons learned from similar projects and better
leverage the federal investment. For example, an official at a 2-year
Strengthening Institutions grantee in North Carolina told us he
independently identified a contact at a Title III grantee to discuss
the application process, but suggested that a clearinghouse of
successful projects would be helpful for connecting institutions with
similar challenges.
As we reported in 2004 and 2007, Education's ability to target
technical assistance is also limited in that the annual performance
reports used to obtain feedback about program improvements may
discourage candor because the reports identify grantees and are used to
make continued funding decisions. The department also does not readily
use the feedback it obtains from grantees to improve the programs. In
2004, we recommended that Education use appropriately collected
feedback from grantees to target its technical assistance. While
Education agreed with the recommendation and officials said they were
considering ways to obtain feedback separate from the annual
performance reporting process, Education continues to rely on these
reports to obtain feedback. Education has separate feedback mechanisms
in place to measure customer satisfaction and gauge the need for
program improvement for some of its other programs.[Footnote 26] One
senior Education official said the current process for obtaining
feedback is adequate for assessing the needs of Title III and V
grantees. However, our review of the annual performance reports that
fiscal year 2006 grantees submitted found that only 22 percent provided
feedback. Additionally, a representative from the contractor
responsible for compiling information from the reports said that the
narrative data--where feedback from grantees can be found--is not
summarized for Education. The 113 grantees that provided feedback in
these reports made a number of suggestions for improving the program,
including requests for improved communications from Education,
consistency in timing of events and reporting requirements, re-
establishing annual conferences for grantees, and clarifying program
regulations. For instance, Education has posted program regulations on
its Web site, but 61 of 113 grantees that provided feedback
specifically requested that Education clarify the regulations.
Conclusions:
Given the current challenges low-income and minority serving
institutions face, and the projected growth in the college-age
population, Title III and V funds will continue to play an integral
role in helping these institutions address some of their most critical
needs. Because these institutions have limited resources, they may need
additional assistance to successfully implement their grant projects.
Education's role in monitoring and providing assistance to Title III
and V grantees is critical to ensuring that the substantial investment
the federal government makes in these programs leads to improvements in
institutional capacity and student outcomes. When we reviewed the
management of these programs in 2004 and 2007, Education had begun
several initiatives to improve its monitoring and assistance. However,
many of these initiatives never achieved their intended purpose or
remain unfinished. Education has made progress in developing tools,
such as an electronic monitoring system and risk-based criteria, to
assess potential risks associated with Title III and V grants, but it
lacks a comprehensive risk-based monitoring and technical assistance
approach to target its efforts. Previously, we recommended that the
Secretary of Education take steps to ensure that monitoring and
technical assistance plans are carried out and targeted to at-risk
grantees and the needs of grantees guide the technical assistance
offered. At the core of such an approach, which Education has not fully
implemented, would be plans to guide its monitoring and technical
assistance efforts following a thorough assessment of the risk and
needs of grantees. Such an approach would also ensure that more
information is shared among grantees about common implementation
challenges and successful projects to better leverage the considerable
federal investment, and ensure that grantees have an opportunity to
provide feedback on areas for program improvement. Additionally,
Education has not adequately addressed skill gaps that limit the
ability of program staff to carry out monitoring and technical
assistance. Consequently, Title III and V funds continue to be at risk
for fraud, waste, or abuse. The internal control weaknesses and
questionable expenditures we identified at certain grantees we reviewed
demonstrate the importance of having a strong monitoring and assistance
program in place. In an environment where Education is called on to
administer additional programs with limited resources, a coordinated
approach to guide its efforts is critical to ensuring that grant funds
are appropriately spent and the needs of grantees are met.
Recommendations for Executive Action:
We recommend that the Secretary of Education take the following five
actions:
* Develop a comprehensive, risk-based approach to target grant
monitoring and technical assistance based on the needs of grantees. In
doing so, Education should take steps to ensure that all available
tools, including its electronic monitoring system, risk-based criteria,
site visits, and grantee annual performance reports, are fully
integrated to better target its limited resources.
* Follow up on each of the improper uses of grant funds that were
identified in this report.
* Provide program staff with the necessary training to fully carry out
monitoring and technical assistance responsibilities.
* Disseminate information to grantees about common implementation
challenges and successful projects to leverage the investment that has
been made across the programs.
* Develop appropriate mechanisms to collect and use feedback from
grantees.
Agency Comments:
We provided a draft of this report to officials at the Department of
Education for review and comment. In written comments, Education agreed
with our findings and recommendations. Officials indicated that they
have begun to undertake a number of corrective actions to respond to
these recommendations, such as convening a task force to better
coordinate program resources toward grantees most in need of monitoring
and/or technical assistance. Officials also agreed to provide
additional training to new and existing program staff, reinstitute the
annual Title III and V project director's meeting in an effort to
better disseminate information about the program and successful grants,
and implement an e-mail address that grantees can use to provide
feedback.
Reinstituting the annual Title III and V project director's meeting is
an important step in strengthening Education's technical assistance for
grantees, but it will be important for Education to develop an approach
for disseminating key information to grantees on a more routine basis
than annual meetings. Additionally, Education's plan to provide
grantees with an e-mail address that is monitored by staff outside the
program office may encourage grantees to provide more candid feedback.
However, unless Education develops an approach to systematically
collect and use the feedback, it may miss opportunities to further
improve its oversight efforts. Education also provided technical
comments, which we incorporated where appropriate. Education's comments
appear in appendix IV.
As arranged with your office, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days
from its issue date. At that time, we will send copies of this report
to relevant congressional committees, the Secretary of Education, and
other interested parties. The report will also be available at no
charge on the GAO Web site at [hyperlink, http://www.gao.gov].
If you or your staff have questions about this report, please contact
me at (202) 512-7215 or scottg@gao.gov. Contact points for our Offices
of Congressional Relations and Public Affairs may be found on the last
page of this report. GAO staff who made key contributions to this
report are listed in appendix V.
Sincerely yours,
Signed by:
George A. Scott:
Director, Education, Workforce, and Income Security Issues:
[End of section]
Appendix I: Objectives, Scope, and Methodology:
We reviewed Title III and V grants programs to determine (1) what are
the characteristics of institutions eligible to receive grants under
Titles III and V, including the characteristics of students served, (2)
what challenges do grantees face , and how have they spent Title III
and V funds to address these challenges, and (3) to what extent does
the Department of Education (Education) monitor the financial and
programmatic performance of Title III and V grantees, and use this
information to target its technical assistance.
To describe the characteristics of postsecondary institutions eligible
to receive grants under Titles III and V, we analyzed 2006 data on 2-
year and 4-year public and private, not-for profit institutions from
Education's Integrated Postsecondary Education Data System.[Footnote
27] Historically Black Colleges and Universities and Tribal Colleges
that receive formula grants through Title III were automatically
included in our eligible population. To determine the number of
institutions eligible for discretionary grant programs under Title III
and V, we identified postsecondary institutions that had low
educational and general expenditures and enrolled more Pell grant
recipients, as compared to comparable institutions. To determine
eligibility for specific types of grant programs, we also analyzed
racial and ethnic data for students enrolled at eligible institutions.
Eligible institutions reporting Hispanic student enrollment of 25
percent or more were categorized as Title V eligible. The 2,283
institutions that did not meet any of the criteria mentioned above were
categorized as ineligible for participation in the Title III and V
grant programs.[Footnote 28]
We also analyzed data from Education's 2004 National Postsecondary
Student Aid Study (NPSAS), the most recent year for which data were
available, to provide insight into student characteristics. Because
NPSAS data are based on a representative sample of students enrolled in
postsecondary education it does not include the universe of
institutions as reported in Integrated Postsecondary Education Data
Systems (IPEDS). As a result, it is not possible to discuss the NPSAS
data in terms of eligible and ineligible institutions as can be done
with IPEDS data. Instead, when discussing NPSAS data, we refer to
minority serving and non-minority serving institutions. While only
Historically Black Colleges and Universities, Hispanic-serving
institutions, and Tribal Colleges are classified as minority serving
institutions for NPSAS, these data are the most complete source of
information on the characteristics of students attending minority
serving institutions. To determine the completeness and reliability of
this data, we reviewed the documentation from the National Center for
Education Statistics on how the data were collected, interviewed
Education officials responsible for handling the data, and performed
electronic tests to look for missing or out-of-range values. Based on
our reviews and tests, we found the data sufficiently reliable for our
purposes.
To describe the challenges that grantees face and how they used grant
funds to address their challenges, we reviewed a representative sample
of grant applications, all electronically submitted annual performance
reports, and interviewed officials from 27 Title III and V grantees.
Specifically, we conducted a content analysis of grant applications
using a representative sample of 78 of the 511 fiscal year 2006
grantees, allowing us to generalize our findings to the entire
population of grantees (see table 9.)
Table 9: Number of 2002 to 2006 Applications Reviewed during Content
Analysis:
Grant program: Title III, Part A, Strengthening Institutions;
Total number of grantees: 222;
Sample size and total cases reviewed: 20.
Grant program: Title III, Part A, Tribal Colleges;
Total number of grantees: 27;
Sample size and total cases reviewed: 14.
Grant program: Title III, Part A, Alaska Native Institutions;
Total number of grantees: 10;
Sample size and total cases reviewed: 5.
Grant program: Title III, Part A, Native Hawaiian Institution;
Total number of grantees: 9;
Sample size and total cases reviewed: 5.
Grant program: Title III, Part B, Historically Black Colleges and
Universities;
Total number of grantees: 97;
Sample size and total cases reviewed: 16.
Grant program: Title V, Part A, Hispanic Serving Institutions;
Total number of grantees: 146;
Sample size and total cases reviewed: 18.
Grant program: Total;
Total number of grantees: 511;
Sample size and total cases reviewed: 78.
Source: GAO calculations based on Department of Education data.
[End of table]
We stratified our sample by the six programs and, within these strata,
randomly selected grantees. Our sample was statistically drawn and
weighted so that we could generalize the results of our review across
programs. As with all samples, our review of grant files is subject to
sampling errors. The effects of sampling errors, due to the selection
of a sample from a larger population, can be expressed as confidence
intervals based on statistical theory. Sampling errors occur because we
use a sample to draw conclusions about a larger population. If a
different sample had been taken, the results might have been different.
To recognize the possibility that other samples might have yielded
other results, we express our confidence in the precision of our
particular sample's results as a 95 percent confidence interval. Each
sample element was subsequently weighted in the analysis to account for
all members of the population, including those that were not selected.
In conducting our content analysis, we developed a code tree that
consisted of potential challenges identified through our review of the
literature and interviews with grantees and higher education advocacy
groups. Two analysts independently coded each application, and then
reconciled any differences in their analysis to ensure inter-rater
reliability.
To describe how Title III and V grantees used grant funds to address
their challenges, we analyzed data from 503 of 511 fiscal year 2006
grantee annual performance reports that were submitted electronically.
To determine the reliability of these data, we interviewed officials
from Education and its contractor about limitations with the data
collected and how its uses these data. We performed a number of data
reliability checks, such as establishing frequency tables for certain
variables to check for outliers and missing values. We also ran tests
to check for out-of-range values for specific variables. Based on
information about outliers provided by Education for a small percentage
of these data (about 1 percent), we decided to keep data for all
variables supplied by the department. As a result of our tests, we
found these data to be sufficiently reliable for our purposes.
To better understand the nature of grantee challenges and how Title III
and V grant funds were used to address them, we also interviewed
officials from 27 grantee institutions about the challenges they face
and their experiences with the grant programs. We selected a
nonprobability sample based on program participation, size of grant,
and geographic location (see table 10).
Table 10: Summary of GAO Contacts with Title III and V Grantees:
Grant program: Strengthening Institutions;
Location: North Carolina and Virginia;
Number of institutions contacted: Site visit: 3;
Number of institutions contacted: Interview: 0.
Grant program: Historically Black Colleges and Universities; Location:
North Carolina, South Carolina, and Virginia;
Number of institutions contacted: Site visit: 3;
Number of institutions contacted: Interview: 0.
Grant program: Hispanic Serving Institutions; Location: New Mexico and
New York;
Number of institutions contacted: Site visit: 3;
Number of institutions contacted: Interview: 4.
Grant program: Tribal Colleges; Location: New Mexico and Montana;
Number of institutions contacted: Site visit: 2;
Number of institutions contacted: Interview: 1.
Grant program: Alaskan Native Serving Institutions; Location: Alaska;
Number of institutions contacted: Site visit: 0;
Number of institutions contacted: Interview: 3.
Grant program: Native Hawaiian Serving Institutions; Location: Hawaii;
Number of institutions contacted: Site visit: 0;
Number of institutions contacted: Interview: 8.
Grant program: Total;
Number of institutions contacted: Site visit: 11;
Number of institutions contacted: Interview: 16.
Source: GAO.
[End of table]
We also conducted a review of the literature to gain a better
understanding of the challenges that specific types of minority serving
institutions face. To determine how Education monitors and provides
technical assistance, we conducted interviews with officials at
Education and reviewed program requirements, policies, procedure
manuals, and monitoring plans. We also conducted additional site visits
at seven Title III and V fiscal year 2006 grantees to evaluate their
fiscal policies and internal control policies and determine whether
program funds were properly used. These institutions were selected
using a nonprobability sample based on factors such as program
participation, size of grant, and geographic location. The grantees
selected were located in California, Illinois, Maryland, North Dakota,
Puerto Rico, Tennessee and Texas. Our grantee site reviews were limited
in scope and were not sufficient for expressing an opinion on the
effectiveness of grantee internal controls or compliance.
[End of section]
Appendix II: Institutional and Student Characteristics, by Program
Eligibility Status:
Table:
Institutional resources (median $ per student): Endowment;
Eligible: 2-year public: $273;
Eligible: 2-year private, not-for-profit: $2,125;
Eligible: 4-year public: $1,251;
Eligible: 4-year private, not-for-profit: $6,610;
Eligible: Total: $1,069;
Ineligible: 2-year public: $287;
Ineligible: 2-year private, not-for-profit: $2,781;
Ineligible: 4-year public: $2,623;
Ineligible: 4-year private, not-for-profit: $20,391;
Ineligible: Total: $5,451.
Institutional resources (median $ per student): Tuition and fees;
Eligible: 2-year public: $2,163;
Eligible: 2-year private, not-for-profit: $8,055;
Eligible: 4-year public: $4,005;
Eligible: 4-year private, not-for-profit: $11,826;
Eligible: Total: $3,687;
Ineligible: 2-year public: $2,183;
Ineligible: 2-year private, not-for-profit: $10,868;
Ineligible: 4-year public: $5,445;
Ineligible: 4-year private, not-for-profit: $19,455;
Ineligible: Total: $6,952.
Institutional expenditures (median $ per student): Instructional
equipment;
Eligible: 2-year public: $1,276;
Eligible: 2-year private, not-for-profit: $2,417;
Eligible: 4-year public: $3,648;
Eligible: 4-year private, not-for-profit: $5,909;
Eligible: Total: $2,177;
Ineligible: 2-year public: $1,288;
Ineligible: 2-year private, not-for-profit: $3,405;
Ineligible: 4-year public: $4,747;
Ineligible: 4-year private, not-for-profit: $8,118;
Ineligible: Total: $4,690.
Institutional expenditures (median $ per student): Academic support;
Eligible: 2-year public: $449;
Eligible: 2-year private, not-for-profit: $780;
Eligible: 4-year public: $1,065;
Eligible: 4-year private, not-for-profit: $1,318;
Eligible: Total: $675;
Ineligible: 2-year public: $490;
Ineligible: 2-year private, not-for-profit: $846;
Ineligible: 4-year public: $1,414;
Ineligible: 4-year private, not-for-profit: $1,916;
Ineligible: Total: $1,163.
Institutional expenditures (median $ per student): Institutional
support;
Eligible: 2-year public: $862;
Eligible: 2-year private, not-for-profit: $2,778;
Eligible: 4-year public: $1,642;
Eligible: 4-year private, not-for-profit: $3,922;
Eligible: Total: $1,402;
Ineligible: 2-year public: $901;
Ineligible: 2-year private, not-for-profit: $3,100;
Ineligible: 4-year public: $1,697;
Ineligible: 4-year private, not-for-profit: $4,665;
Ineligible: Total: $2,463.
Institutional expenditures (median $ per student): Student services;
Eligible: 2-year public: $568;
Eligible: 2-year private, not-for-profit: $1,623;
Eligible: 4-year public: $993;
Eligible: 4-year private, not-for-profit: $2,185;
Eligible: Total: $878;
Ineligible: 2-year public: $595;
Ineligible: 2-year private, not-for-profit: $1,341;
Ineligible: 4-year public: $1,106;
Ineligible: 4-year private, not-for-profit: $3,192;
Ineligible: Total: $1,495.
Open admission (% of institutions): Yes;
Eligible: 2-year public: 96%;
Eligible: 2-year private, not-for-profit: 49%;
Eligible: 4-year public: 29%;
Eligible: 4-year private, not-for-profit: 28%;
Eligible: Total: 60%;
Ineligible: 2-year public: 95%;
Ineligible: 2-year private, not-for-profit: 33%;
Ineligible: 4-year public: 9%;
Ineligible: 4-year private, not-for-profit: 10%;
Ineligible: Total: 34%.
Open admission (% of institutions): No;
Eligible: 2-year public: 4%;
Eligible: 2-year private, not-for-profit: 51%;
Eligible: 4-year public: 71%;
Eligible: 4-year private, not-for-profit: 72%;
Eligible: Total: 40%;
Ineligible: 2-year public: 5%;
Ineligible: 2-year private, not-for-profit: 67%;
Ineligible: 4-year public: 91%;
Ineligible: 4-year private, not-for-profit: 90%;
Ineligible: Total: 66%.
Offers remedial services (% of institutions): Yes;
Eligible: 2-year public: 100%;
Eligible: 2-year private, not-for-profit: 85%;
Eligible: 4-year public: 88%;
Eligible: 4-year private, not-for-profit: 78%;
Eligible: Total: 90%;
Ineligible: 2-year public: 99%;
Ineligible: 2-year private, not-for-profit: 67%;
Ineligible: 4-year public: 74%;
Ineligible: 4-year private, not-for-profit: 62%;
Ineligible: Total: 75%.
Offers remedial services (% of institutions): No;
Eligible: 2-year public: 0;
Eligible: 2-year private, not-for-profit: 15%;
Eligible: 4-year public: 12%;
Eligible: 4-year private, not-for-profit: 23%;
Eligible: Total: 10%;
Ineligible: 2-year public: 1%;
Ineligible: 2-year private, not-for-profit: 33%;
Ineligible: 4-year public: 26%;
Ineligible: 4-year private, not-for-profit: 38%;
Ineligible: Total: 25%.
Average undergraduate enrollment;
Eligible: 2-year public: 5,995;
Eligible: 2-year private, not-for-profit: 497;
Eligible: 4-year public: 7,712;
Eligible: 4-year private, not-for-profit: 1,552;
Eligible: Total: 4,595;
Ineligible: 2-year public: 5,870;
Ineligible: 2-year private, not-for-profit: 291;
Ineligible: 4-year public: 9,199;
Ineligible: 4-year private, not-for-profit: 1,956;
Ineligible: Total: 4,575.
Race/ethnicity (% of students): African American;
Eligible: 2-year public: 16%;
Eligible: 2-year private, not-for-profit: 16%;
Eligible: 4-year public: 22%;
Eligible: 4-year private, not-for-profit: 24%;
Eligible: Total: 18%;
Ineligible: 2-year public: 11%;
Ineligible: 2-year private, not-for-profit: 13%;
Ineligible: 4-year public: 8%;
Ineligible: 4-year private, not-for-profit: 8%;
Ineligible: Total: 9%.
Race/ethnicity (% of students): Asian;
Eligible: 2-year public: 7%;
Eligible: 2-year private, not-for-profit: 8%;
Eligible: 4-year public: 6%;
Eligible: 4-year private, not-for-profit: 3%;
Eligible: Total: 6%;
Ineligible: 2-year public: 6%;
Ineligible: 2-year private, not-for-profit: 3%;
Ineligible: 4-year public: 7%;
Ineligible: 4-year private, not-for-profit: 5%;
Ineligible: Total: 6%.
Race/ethnicity (% of students): Hispanic;
Eligible: 2-year public: 19%;
Eligible: 2-year private, not-for-profit: 15%;
Eligible: 4-year public: 25%;
Eligible: 4-year private, not-for-profit: 29%;
Eligible: Total: 22%;
Ineligible: 2-year public: 11%;
Ineligible: 2-year private, not-for-profit: 15%;
Ineligible: 4-year public: 6%;
Ineligible: 4-year private, not-for-profit: 6%;
Ineligible: Total: 8%.
Race/ethnicity (% of students): Native American;
Eligible: 2-year public: 1%;
Eligible: 2-year private, not-for-profit: 7%;
Eligible: 4-year public: 1%;
Eligible: 4-year private, not-for-profit: 1%;
Eligible: Total: 1%;
Ineligible: 2-year public: 1%;
Ineligible: 2-year private, not-for-profit: [Empty];
Ineligible: 4-year public: 1%;
Ineligible: 4-year private, not-for-profit: 1%;
Ineligible: Total: 1%.
Race/ethnicity (% of students): Total minority;
Eligible: 2-year public: 43%;
Eligible: 2-year private, not-for-profit: 46%;
Eligible: 4-year public: 54%;
Eligible: 4-year private, not-for-profit: 56%;
Eligible: Total: 48%;
Ineligible: 2-year public: 30;
Ineligible: 2-year private, not-for-profit: 30%;
Ineligible: 4-year public: 22;
Ineligible: 4-year private, not-for-profit: 29%;
Ineligible: Total: 24%.
Race/ethnicity (% of students): White;
Eligible: 2-year public: 56%;
Eligible: 2-year private, not-for-profit: 54%;
Eligible: 4-year public: 45%;
Eligible: 4-year private, not-for-profit: 41%;
Eligible: Total: 51;
Ineligible: 2-year public: 70%;
Ineligible: 2-year private, not-for-profit: 70%;
Ineligible: 4-year public: 76%;
Ineligible: 4-year private, not-for-profit: 68%;
Ineligible: Total: 75%.
Race/ethnicity (% of students): Other;
Eligible: 2-year public: 1%;
Eligible: 2-year private, not-for-profit: [Empty];
Eligible: 4-year public: 1%;
Eligible: 4-year private, not-for-profit: 3%;
Eligible: Total: 1%;
Ineligible: 2-year public: [Empty];
Ineligible: 2-year private, not-for-profit: [Empty];
Ineligible: 4-year public: 2%;
Ineligible: 4-year private, not-for-profit: 3%;
Ineligible: Total: 1%.
Gender (% of students): Male;
Eligible: 2-year public: 41%;
Eligible: 2-year private, not-for-profit: 34%;
Eligible: 4-year public: 42%;
Eligible: 4-year private, not-for-profit: 38%;
Eligible: Total: 41%;
Ineligible: 2-year public: 42%;
Ineligible: 2-year private, not-for-profit: 37%;
Ineligible: 4-year public: 46%;
Ineligible: 4-year private, not-for-profit: 43%;
Ineligible: Total: 44%.
Gender (% of students): Female;
Eligible: 2-year public: 59%;
Eligible: 2-year private, not-for-profit: 66%;
Eligible: 4-year public: 58%;
Eligible: 4-year private, not-for-profit: 62%;
Eligible: Total: 59%;
Ineligible: 2-year public: 58%;
Ineligible: 2-year private, not-for-profit: 63%;
Ineligible: 4-year public: 54%;
Ineligible: 4-year private, not-for-profit: 57%;
Ineligible: Total: 56%.
Part-time attendance;
Eligible: 2-year public: 62%;
Eligible: 2-year private, not-for-profit: 34%;
Eligible: 4-year public: 29%;
Eligible: 4-year private, not-for-profit: 22%;
Eligible: Total: 48%;
Ineligible: 2-year public: 62%;
Ineligible: 2-year private, not-for-profit: 28%;
Ineligible: 4-year public: 19%;
Ineligible: 4-year private, not-for-profit: 17%;
Ineligible: Total: 34%.
Age at time of first enrollment: Under 18;
Eligible: 2-year public: 7%;
Eligible: 2-year private, not-for-profit: 2%;
Eligible: 4-year public: 4%;
Eligible: 4-year private, not-for-profit: 3%;
Eligible: Total: 5%;
Ineligible: 2-year public: 6%;
Ineligible: 2-year private, not-for-profit: 2%;
Ineligible: 4-year public: 2%;
Ineligible: 4-year private, not-for-profit: 2%;
Ineligible: Total: 4%.
Age at time of first enrollment: 18 to 24%;
Eligible: 2-year public: 51%;
Eligible: 2-year private, not-for-profit: 51%;
Eligible: 4-year public: 70%;
Eligible: 4-year private, not-for-profit: 64%;
Eligible: Total: 58%;
Ineligible: 2-year public: 53%;
Ineligible: 2-year private, not-for-profit: 65%;
Ineligible: 4-year public: 80%;
Ineligible: 4-year private, not-for-profit: 77%;
Ineligible: Total: 69%.
Age at time of first enrollment: 25 or older;
Eligible: 2-year public: 42%;
Eligible: 2-year private, not-for-profit: 47%;
Eligible: 4-year public: 26%;
Eligible: 4-year private, not-for-profit: 34%;
Eligible: Total: 37%;
Ineligible: 2-year public: 41%;
Ineligible: 2-year private, not-for-profit: 33%;
Ineligible: 4-year public: 18%;
Ineligible: 4-year private, not-for-profit: 21%;
Ineligible: Total: 27%.
Financial aid (% of students receiving): Pell grants;
Eligible: 2-year public: 41%;
Eligible: 2-year private, not-for-profit: 58%;
Eligible: 4-year public: 43%;
Eligible: 4-year private, not-for-profit: 48%;
Eligible: Total: 44%;
Ineligible: 2-year public: 33%;
Ineligible: 2-year private, not-for-profit: 40%;
Ineligible: 4-year public: 23%;
Ineligible: 4-year private, not-for-profit: 23%;
Ineligible: Total: 15%.
Financial aid (% of students receiving): Federal grant aid[A];
Eligible: 2-year public: 50%;
Eligible: 2-year private, not-for-profit: 68%;
Eligible: 4-year public: 53%;
Eligible: 4-year private, not-for-profit: 67%;
Eligible: Total: 54%;
Ineligible: 2-year public: 33%;
Ineligible: 2-year private, not-for-profit: 39%;
Ineligible: 4-year public: 23%;
Ineligible: 4-year private, not-for-profit: 22%;
Ineligible: Total: 25%.
Retention rate;
Eligible: 2-year public: 55%;
Eligible: 2-year private, not-for-profit: 49%;
Eligible: 4-year public: 67%;
Eligible: 4-year private, not-for-profit: 65%;
Eligible: Total: 60%;
Ineligible: 2-year public: 56%;
Ineligible: 2-year private, not-for-profit: 67%;
Ineligible: 4-year public: 74%;
Ineligible: 4-year private, not-for-profit: 75%;
Ineligible: Total: 69%.
Graduation rate;
Eligible: 2-year public: 20%;
Eligible: 2-year private, not-for-profit: 39%;
Eligible: 4-year public: 40%;
Eligible: 4-year private, not-for-profit: 38%;
Eligible: Total: 39%;
Ineligible: 2-year public: 22%;
Ineligible: 2-year private, not-for-profit: 59%;
Ineligible: 4-year public: 56%;
Ineligible: 4-year private, not-for-profit: 67%;
Ineligible: Total: 60%.
Source: GAO analysis of 2006 IPEDS data and 2006 to 2007 Pell Grant
recipient data.
[A] Federal grant aid reported in IPEDS captures data for first-time,
full-time students only.
[End of table]
[End of section]
Appendix III: Fiscal Year 2002 to 2005 Grantee Expenditures by Focus
Area:
Figure 7: Fiscal Years 2002 and 2003 Grantee Expenditures, by Focus
Area:
[Refer to PDF for image: two pie-charts, two horizontal bar graphs]
Total expenditures, by focus area, fiscal year 2002 grantees:
Fiscal stability: 7%;
Institutional management: 19%;
Student support: 32%;
Academic quality: 42%.
Percentage of fiscal year 2002 grantees undertaking at least one
activity, by focus area:
Fiscal stability: 32%;
Institutional management: 33%;
Student support: 64%;
Academic quality: 67%.
Total expenditures, by focus area, fiscal year 2003 grantees:
Fiscal stability: 7%;
Institutional management: 19%;
Student support: 32%;
Academic quality: 41%.
Percentage of fiscal year 2003 grantees undertaking at least one
activity, by focus area:
Fiscal stability: 34%;
Institutional management: 35%;
Student support: 66%;
Academic quality: 69%.
Source: GAO analysis of Department of Education annual performance
report data.
Note: Due to rounding, totals may not add to 100 percent.
[End of figure]
Figure 8: Fiscal Years 2004 and 2005 Grantee Expenditures, by Focus
Area:
[Refer to PDF for image: two pie-charts, two horizontal bar graphs]
Total expenditures, by focus area, fiscal year 2004 grantees:
Fiscal stability: 7%;
Institutional management: 21%;
Student support: 34%;
Academic quality: 38%.
Percentage of fiscal year 2004 grantees undertaking at least one
activity, by focus area:
Fiscal stability: 30%;
Institutional management: 33%;
Student support: 64%;
Academic quality: 66%.
Total expenditures, by focus area, fiscal year 2005 grantees:
Fiscal stability: 7%;
Institutional management: 19%;
Student support: 33%;
Academic quality: 41%.
Percentage of fiscal year 2005 grantees undertaking at least one
activity, by focus area:
Fiscal stability: 29%;
Institutional management: 27%;
Student support: 60%;
Academic quality: 63%.
Source: GAO analysis of Department of Education annual performance
report data.
[End of figure]
[End of section]
Appendix IV: Comments from the Department of Education:
United States Department Of Education:
Office Of Postsecondary Education:
The Assistant Secretary:
1990 K St. N.W.
Washington, DC 20006:
[hyperlink, http://www.ed.gov]
"The Department of Education's mission is to promote student
achievement and preparation for global competitiveness by fostering
educational excellence and ensuring equal access."
June 30, 2009:
Mr. George A. Scott:
Director:
Education, Workforce, and Income Security Issues:
United States Government Accountability Office:
Washington, DC 20548:
Dear Mr. Scott:
Thank you for providing the U.S. Department of Education (the
Department) with a draft copy of the U.S. Government Accountability
Office's (GAO's) report entitled, "Low-Income And Minority Serving
Institutions: Management Attention to Longstanding Concerns Needed to
Improve Education's Oversight of Grant Programs" (GAO-09-309).
This study focuses on institutions that serve large proportions of low-
income and minority students. GAO was asked to determine: (1)
characteristics of institutions eligible to receive, grants under
Titles III and V, including characteristics of students served, (2) any
challenges grantees face, and how they spent Title III and V funds to
address these challenges, and (3) to what extent the Department of
Education monitors the financial and programmatic performance of Title
III and V grantees, and uses this information to target its technical
assistance. As a result of its study, GAO made five recommendations to
the Department. Below are the Department's responses to each
recommendation.
Recommendation 1: Develop a comprehensive, risk-based approach to
target grant monitoring and technical assistance based on the needs of
grantees. In doing so, Education should take steps to ensure that all
available tools, including its electronic monitoring system, risk-based
criteria, site visits, and grantee annual performance reports are fully
integrated to better target its limited resources.
Response: We agree with this recommendation. In May of 2009, the
Department convened a Postsecondary Oversight Improvement Task Force to
help ensure that the Department's oversight of postsecondary schools is
sufficient to protect the investments made with federal aid and to
ensure that institutions are able to make informed decisions and
accomplish their postsecondary goals. This task force serves as a
vehicle for exchanging information and coordinating resources
strategically to ensure that those grantees most in need of technical
assistance and oversight from the Department receive it.
Recommendation 2: Follow up on each of the improper uses of grant funds
that were identified in this report.
Response: We agree with this recommendation. The Institutional
Development and Undergraduate Education Service (IDUES) program
officers will coordinate with the Program Oversight staff in the Office
of Postsecondary Education (OPE) to conduct site visits at the
institutions mentioned in the report. The site visits will include both
a programmatic and fiscal review, with corrective actions as
appropriate.
Recommendation 3: Provide program staff with the necessary training to
fully carry out monitoring and technical assistance responsibilities.
Response: We agree with this recommendation. OPE will coordinate with
the Department's Risk Management Service to continue to offer grant
monitoring training and strongly encourage program staff to
participate. OPE will also implement a mentoring process through which
each new program officer is paired with an experienced program officer.
The two program officers will meet regularly for a full year so that
the more experienced program officer can provide the less experienced
program officer with detailed training about grants monitoring. In
addition, each new program officer will conduct an on-site review with
the Program Oversight staff in order to gain valuable field experience
in offering technical assistance and providing fiscal review and
oversight of grant funds. Further, OPE will continue to offer regular
training to its staff on the Grants Electronic Monitoring System as
well as training on how to interpret Annual Performance Report data to
ensure greater consistency in awarding noncompetitive continuation
grants.
Recommendation 4: Disseminate information to grantees about common
implementation challenges and successful projects to leverage the
investment that has been made across the programs.
Response: We agree with this recommendation. IDUES recognizes the need
to increase its interactions with grantees and to facilitate
interactions among grantees. IDUES will reinstitute the annual meeting
of Title III and Title V grantees, which allows grantees to share
promising practices and common concerns.
Recommendation 5: Develop appropriate mechanisms to collect and use
feedback from grantees.
Response: We agree with this recommendation. To capture the kind of
feedback necessary for continuous program improvement, we will
implement an e-mail address to provide grantees an opportunity to
submit comments, questions, praise and criticism to the Department. To
encourage candor, an individual not associated with OPE program offices
will monitor the mailbox so that grantee input remains anonymous. We
will use both email and program office Web sites to encourage grantees
to provide this feedback.
Responses will be redacted as needed and distributed to program office
directors regularly for appropriate handling.
We greatly appreciate your examination of this important issue.
Sincerely,
Signed by:
Daniel T. Madzelan:
Delegated the Authority to Perform the Functions and Duties of the
Assistant Secretary for Postsecondary Education:
Attachment:
[End of section]
Appendix V: GAO Contact and Staff Acknowledgments:
GAO Contact:
George A. Scott, (202) 512-7215 or scottg@gao.gov:
Staff Acknowledgments:
Debra Prescott (Assistant Director) and Carla Craddock (Analyst-in-
Charge) managed this assignment. In addition, the following individuals
made important contributions to this report: Susan Aschoff, Jenna
Aurand, Carolyn Boyce, Muriel Brown, Sunny Chang, Alisha Chugh, Bonnie
Derby, Lauren Fassler, Doreen Feldman, Jeanette Franzel, Alice
Feldesman, Lisa Galvan, Jeremie Greer, Melissa Jaynes, Angela Leventis,
Sheila McCoy, John Mingus Jr., Lauren Mohlie, Mimi Ngyuen, Dae Park,
Susan Ragland, Glenn Spiegel, Sabrina Springfield, Nicholas Weeks, and
Doris Yanger.
[End of section]
Footnotes:
[1] These programs include three Title III, Part A programs:
Strengthening Institutions, American Indian Tribally Controlled
Colleges and Universities, and Alaska Native and Native Hawaiian
Serving Institutions. It also includes Title III, Part B Strengthening
Historically Black Colleges and Universities, and Title V, Part A
Developing Hispanic Serving Institutions. Throughout the report when we
refer to Title III and Title V programs or grants we are referring to
these specific programs. Our review did not include Title III, Part B
Historically Black Professional or Graduate Institutions; Part D HBCU
Capital Financing; or Part E Minority Science and Engineering
Improvement Program.
[2] GAO, Low-Income and Minority Serving Institutions: Department of
Education Could Improve Its Monitoring and Assistance, [hyperlink,
http://www.gao.gov/products/GAO-04-961] (Washington, D.C. : Sept. 21,
2004) and GAO, Low-Income and Minority Serving Institutions: Education
Has Taken Steps to Improve Monitoring and Assistance but, Further
Progress Is Needed, [hyperlink,
http://www.gao.gov/products/GAO-07-926T] (Washington, D.C.: June 4,
2007).
[3] IPEDS is a system of surveys designed to collect data from all
primary providers of postsecondary education on institution-level
information such as enrollments, program completions, faculty, staff,
finances, and academic libraries. Data are collected annually from
approximately 9,600 postsecondary institutions, including over 6,000
institutions eligible for the federal student aid programs.
[4] NPSAS is a comprehensive nationwide study designed to determine how
students and their families pay for postsecondary education and to
describe some demographic and other characteristics of those enrolled.
The surveys use a nationally representative sample of postsecondary
education institutions and students within those institutions.
[5] Eight grantees submitted paper filings of these reports and these
were not included in our analysis.
[6] Higher Education Act of 1965, Pub. L. No. 89-329, Title III, 79
Stat. 1219, 1229.
[7] See 20 U.S.C. §§ 1057-1059g. While not specified in the Act,
Education's guidance also allows grantees to use grant funds to improve
student support services.
[8] See Higher Education Act of 1986, Pub. L. No. 99-498, Title III,
100 Stat. 1294. For Education's Strengthening Institutions Program
regulations, see 34 C.F.R. pt. 607.
[9] See Higher Education Act of 1998, Pub. L. No. 105-244, Title III,
112 Stat. 1581, 1636, 1639, 1641, 1765.
[10] The Historically Black Colleges and Universities program formula
considers, in part, the amount of funds appropriated, the number of
Pell Grant recipients, the number of graduates, and the number of
students who enroll in graduate school in degree programs in which
African Americans are underrepresented within 5 years of earning an
undergraduate degree. Institutions that participate in the Title III,
Part A, Tribally Controlled Colleges and Universities program receive
grants based on a formula which also allows the Secretary of Education
to reserve 30 percent of appropriations for 1-year construction,
maintenance, or renovation projects for grants not less than $1 million
beginning in fiscal year 2009. The majority of other funds available
are to be distributed based on Native American student head count.
[11] These programs were first authorized in the College Cost Reduction
and Access Act (Pub. L. No. 110-84) prior to inclusion in the Higher
Education Opportunity Act (Pub. L. No. 110-315).
[12] Domestic Working Group, Grant Accountability Project, Guide to
Opportunities for Improving Grant Accountability (October 2005).
[13] Under 31 U.S.C. § 3512 (c), (d), commonly known as the Federal
Managers' Financial Integrity Act of 1982, agency management is
responsible for establishing, maintaining, and assessing internal
control to provide reasonable assurance that it is meeting the Act's
broad internal control objectives consistent with the standards GAO
prescribes and the evaluation guidance Office of Management and Budget
(OMB) issues. For more information on internal control standards and
guidance, see GAO, Standards for Internal Control in the Federal
Government, [hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1]
(Washington, D.C.: November 1999); and OMB, Management's Responsibility
for Internal Control, Circular No. A- 123 (Washington, D.C.: Dec. 21,
2004).
[14] Western Interstate Commission for Higher Education, Knocking at
the College Door, Projections of High School Graduates by State and
Race/Ethnicity (Boulder, Colo., 2008).
[15] M. Planty, et. al., "Mobility of College Students" (Indicator 10,
Supplemental Table 10-2), The Condition of Education 2008 , NCES 2008-
031, a report for the U.S. Department of Education, National Center for
Education Statistics, Institute of Education Sciences (Washington,
D.C., 2008).
[16] Pell Grants are grants to low-and middle-income undergraduate
students who have federally defined financial need and who are enrolled
in a degree or certificate program. In general, a student's Pell Grant
award is determined by subtracting a student and family's expected
family contribution from either the maximum allowable Pell Grant award,
$5,350 for the 2009-2010 school year, or the cost of attendance,
whichever is less.
[17] Grants provided by federal agencies such as Education, include
Title IV Pell Grants and Supplemental Educational Opportunity Grants,
as well as need-based and merit-based educational assistance funds and
training vouchers provided from other federal agencies and/or federally-
sponsored educational benefits programs.
[18] For 4-year institutions, retention rate is defined as the
percentage of first-time degree-seeking undergraduates from the
previous fall who are enrolled the following fall semester. For all
other institutions, this is the percentage of first-time degree or
certificate-seeking students from the prior fall who either re-enrolled
or successfully completed their program by the following fall.
[19] U.S. Department of Education, College Persistence on the Rise?
Changes in 5-year Degree Completion and Postsecondary Persistence Rates
between 1994 and 2000 (Washington, D.C., 2004).
[20] Graduation and completion rates are measured by the proportion of
students who earn a degree within 150 percent of the expected time--6
years for a bachelor's degree and 3 years for an associate degree. The
formula counts only first-time, full-time students.
[21] U.S. Department of Education, Placing College Graduation Rates in
Context: How 4-Year College Graduation Rates Vary With Selectivity and
the Size of Low-Income Enrollment (Washington, D.C., 2006).
[22] The Pell Institute, Demography Is Not Destiny: Increasing the
Graduation Rates of Low-Income College Students at Large Public
Universities (Washington, D.C., 2007).
[23] At the time of publication, the institution did not have data
available for the advanced manufacturing technology program.
[24] [hyperlink, http://www.gao.gov/products/GAO-04-961].
[25] Questionable expenses are expenditures that appear to have been
made for incorrect amounts, for unauthorized purposes, or for personal
use. They can be inadvertent errors, such as duplicate payments and
calculation errors, or violations of grant agreement terms, such as
payments for unsupported or inadequately supported claims or payments
resulting from fraud and abuse.
[26] Education has collected customer satisfaction data for selected
grant programs and federal student aid programs through the American
Customer Satisfaction Index to use in decision making for program
improvement.
[27] Because participation in Title III and V programs is restricted to
public and private not-for-profit institutions, for-profit institutions
are not included in our analysis.
[28] Decisions institutions with branch campuses make about whether to
report their Integrated Postsecondary Education Data Systems data
separately for each branch campus or in the aggregate for an entire
system of campuses may have resulted in the number of eligible
institutions being underestimated in this report. Branch campuses may
apply for the Title III and V programs if they independently meet the
eligibility criteria.
[End of section]
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