Topic:
GRANTS; LEGISLATION; FEDERAL ASSISTANCE PROGRAMS;
Location:
FEDERAL ASSISTANCE PROGRAMS; INFORMATION TECHNOLOGY - INTERNET;

OLR Research Report


August 9, 2007

 

2007-R-0477

GOVERNMENT-SPENDING TRANSPARENCY LAWS

By: Kristin Sullivan, Associate Analyst

You asked for a brief summary of the Federal Funding Accountability and Transparency Act as well as information on related state laws.

SUMMARY

Congress passed the Federal Funding Accountability and Transparency Act of 2006 (P.L. 109-282) to increase transparency and accountability in government spending by providing the public with access to information about federal awards through a free, single, searchable website. Under the act, “federal awards” include grants, subgrants, contracts, subcontracts, loans, cooperative agreements, purchase orders, task orders, delivery orders, and other forms of financial assistance. They do not include individual transactions valued at less than $25,000.

We found five states (Hawaii, Kansas, Minnesota, Oklahoma, and Texas) that, in response to the federal law, enacted legislation establishing public-access websites to track government spending. In addition, the governor of Missouri issued an executive order for the same reason. Indiana's executive order establishing a website to log state contracts on the Internet preceded the federal law's passage.

The Illinois General Assembly is currently considering HB 473, the Funding Accountability and Transparency Act. Several other states, including Connecticut, Georgia, Maryland, New Mexico, and Tennessee, had similar proposals during the 2007 session that died either in committee or on the floor of one of the chambers.

FEDERAL FUNDING ACCOUNTABILITY AND TRANSPARENCY ACT

The Federal Funding Accountability and Transparency Act establishes a public-access website to track government spending. The website must be up and running by January 1, 2008 and provide the following data for each federal award:

1. the recipient's name;

2. the dollar amount;

3. the transaction type, funding agency, North American Industry Classification System code used to identify market sector or Catalog of Federal Domestic Assistance number, and funding purpose;

4. the recipient's location as well as the primary location of performance under the award, including city, state, congressional district, and country;

5. a unique identifier for the recipient and the recipient's parent entity, when applicable; and

6. other information that the Office of Management and Budget deems relevant.

The act exempts from disclosure personal information on federal employees and federal assistance recipients. In addition, the website does not have to provide information on (1) credit card transactions until October 1, 2008 or (2) subgrants or subcontracts until January 1, 2009.

STATE SPENDING TRANSPARENCY LAWS

Generally, the major aspects of state transparency laws are similar to each other and the federal law. They all establish a free, publicly-available, and searchable website of state expenditures. What constitutes an “expenditure” for the purpose of the website, however, differs somewhat from state-to-state. In addition, states vary with respect to the information they require to be disclosed and the information they exempt from disclosure. Table 1 provides a summary of the state transparency laws and Indiana and Missouri executive orders.

TABLE 1: TRANSPARENCY LAWS

State

Transparency Tool (Administering Agency)

Covered

Expenditures

Required

Information

Exempt

Information

Hawaii

Act No. 272 (2007)

a free, publicly-available, and searchable website

(Department of Budget and Finance)

“state awards,” which include grants, subgrants, loans, awards, cooperative agreements, contracts, subcontracts, purchase orders, and task orders

n award recipient's name and address

n information on the award including its amount, transaction type, funding agency, North American Industry Classification System code, program source, and description of purpose

n a unique identifier for the recipient and parent company, if any

n any other relevant information the department specifies

n one-time transactions of less than $25,000

n credit card transactions before October 1, 2009

n information concerning state employees

n information concerning state public assistance recipients

n classified information

Indiana

Executive Order 05-07

a free, publicly-available, and searchable online index

(Department of Administration)

contracts to which the state is a party, including professional and personal services contracts, grants, leases, legal services, memorandums of understanding, maintenance contracts, contracts for procured service, and license agreements

n “Executive Document Summary,” which includes detailed vendor information

n contracting agency

n contract amount, date, type, and purpose, among other things

confidential information under state or federal law

Kansas

HB 2368 163 (2007)

a single, searchable, and publicly-available online database under the Taxpayer Transparency Program

(Department of Administration)

In addition, the act creates the Public Finance Transparency Board to advise and consult with the secretary of administration on the website's content and format.

Annual expenditures (including contractual services), revenues, and bonded indebtedness

n expenditures (e.g., state agency disbursements, bond debt payments, salaries and wages, contractual services, aid to local government units, and capital improvements)

n annual revenues (e.g., agency receipts or deposits into the state treasury; taxes; earnings; gifts, donations, and federal grants; and non-revenue receipts)

n annual bonded indebtedness (e.g., amount of the total original obligation and its term, the source of funding for repayment, balance remaining, and any refinancing)

n any other relevant information the secretary of administration and public finance transparency board specify

n information that is not available in the central accounting system and the state payroll system at the time of the website's initial implementation

n confidential information under state or federal law

Table 1: Continued

State

Transparency Tool (Administering Agency)

Covered

Expenditures

Required

Information

Exempt

Information

Minnesota

HF 548 Art. 2 34 (2007)

(To be codified as Minn. Stat. 16C.046)

a free and publicly-available website with a searchable database

(Department of Administration)

state contracts, including grants, over $25,000

n name and address of contract recipient

n awarding agency

n type of contract or grant

n statement indicating its purpose

n amount and the fund from which it will be paid

n dollar value of state contracts the entity has received in each fiscal year, if applicable

n dollar value of state grants the entity has received in each fiscal year, if applicable

payments to (1) local

government units, (2) state employees, or (3) individuals under public assistance laws

Missouri

Executive Order 07-24

the Missouri Accountability Portal (MAP), a free, publicly-available, searchable, online database

(Office of Administration)

financial transactions related to the purchase of goods and services and the distribution of state program funds

detailed information about payments, vendors, and contracts, among other things

n certain individuals' names (to protect their confidentiality)

n Information on state employee payroll and fringe benefit payments until an unspecified future date

n confidential information under state or federal law or regulation

Oklahoma

SB 1 (2007)

(To be codified as Okla. Stat. tit. 62, 46)

a free, single, searchable, and website

(Office of State Finance)

n grants

n contracts and subcontracts

n certain tax refunds, rebates, and credits

n payments made under certain programs including the Oklahoma Quality Jobs Program Act, Small Employer Quality Jobs Incentive Act, and Oklahoma Quality Investment Act

n expenditures from the Constitutional Reserve Fund

n expenditures pursuant to any compact between the governor and a federally-recognized Indian tribe or nation in Oklahoma

In addition, the website must provide the complete contents of the “Tax Expenditure Report,” which the Oklahoma Tax Commission publishes.

n recipient's name and address

n amount and type of transaction

n funding or expending agency

n budget program source

n description of the purpose

n any other relevant information the Office of State Finance specifies

n fund transfers between state agencies

n state or federal assistance payments to individuals

n confidential information under state or federal law

Table 1: Continued

State

Transparency Tool (Administering Agency)

Covered

Expenditures

Required

Information

Exempt

Information

Texas

HB 3430 (2007)

(To be codified as Tex. Gov't. Code Ann. 403.024 and 2054.126)

a single, searchable, and publicly available online database

(Office of the Comptroller)

state expenditures, including contracts and grants

n amount, date, payor, and payee

n a listing of state expenditures by (1) object of expense with links to the warrant or check register level and (2) to the extent maintained by state agency accounting systems in a reportable format, class and item levels

n information that is confidential by law

n a payee's address

HYPERLINKS

Indiana's Active Contracts and Quantity Purchase Agreements: http://www.in.gov/idoa/proc/active.html, last visited August 7, 2007.

Missouri Accountability Portal: http://mapyourtaxes.mo.gov/map/#, last visited August 7, 2007.

Where the Money Goes (Texas): http://www.window.state.tx.us/comptrol/expendlist/cashdrill.php, last visited August 7, 2007.

KS:dw