The National Endowment for Democracy's Administration of Its Grants Program

GAO discussed its review of the National Endowment for Democracy's procedures for grantee selection, monitoring, and evaluation in its overseas grants program. GAO found that, during its first 2 years of operation, the Endowment: (1) generally relied on its grantees to monitor and evaluate their own programs; (2) awarded 88 percent of its fiscal years 1984 and 1985 funds to four core grantees representing labor, business, and the two major political parties; (3) spent more time monitoring its small discretionary grantees than it did on its core grantees; and (4) viewed its function as primarily a funding conduit for the four core grantees. In 1985, Congress: (1) eliminated funding earmarks to labor and business grantees; (2) imposed a 25-percent limit on awards to any one grantee; (3) placed the Endowment under the Freedom of Information Act; and (4) required the Endowment to coordinate its programs with the Department of State. GAO noted that: (1) the Endowment Board issued a policy statement recognizing its responsibilities as a recipient of congressionally appropriated funds, but the statement did not contain implementation procedures; (2) planning and project selection, grantee information verification, and evaluation of completed projects require particular attention; and (3) State was generally satisfied with the initial implementation of the consultation agreement.