Commentary: Illinois taxpayers deserve transparency on government grants

Introduction

In fiscal year 2011, Illinois awarded more than $1.1 billion in grants to nonprofit organizations. Yet few know how exactly this money was used and whether it was used effectively. Why? Because information about state grants often is difficult or impossible for citizens, journalists and elected officials to obtain.

That’s why the Illinois Policy Institute is supporting a measure by state Sens. Martin Sandoval (D-Chicago) and Kirk Dillard (R-Westmont) to make Illinois’ outdated grant reporting process more transparent.

Illinois Senate Bill 3773 would require grant information to be posted online in a centralized location. A detailed online repository of how grant money is spent and what results are achieved would allow citizens, journalists and government employees to catch fraud and corruption at nonprofits that receive grants from the state.

This information would be available to the public in a uniform manner – giving citizens easy access to information that can be meaningful to them. Currently, each agency that awards grants to private organizations uses a reporting approach that, for the most part, is unique to the agency. Illinois’ hodgepodge approach of incomplete grant reporting has three major shortfalls:

1. Many agencies use an outdated or incomplete reporting process that does not require grantees to provide information on how money was spent or what outcomes they achieved.
2. Even when agencies utilize a strong grant reporting system, these reports often end up in basement file cabinets far from the eyes of citizens, journalists and elected officials.
3. Grant reporting is neither uniform across agencies nor collected in a centralized place, making it very difficult to compare grants and catch overlaps.

Under this process, there is no way of determining the impact of a grant, if it has been successful or if another nonprofit can do the job better. Worse, the current system lacks significant safeguards against corruption and fraud.

For example, an investigation by Illinois’ inspector general found that grantees can submit identical invoices to multiple different agencies, allowing them to bill for the same service multiple times. Because grant reporting is incomplete and isolated within each agency, the agencies have no way of knowing if grant recipients are being paid twice for the same service. In just one example, an incident of this type of fraud cost taxpayers more than $18 million.

Just as importantly, taxpayers and elected officials will be able to compare the results of two grants and determine which nonprofit is more effective and more efficient. Armed with this information, the state can better channel its resources to have the greatest impact and help the most people.

To find out more about issues of transparency and accountability in Illinois, visit the Illinois Policy Institute website.