Senate Banking, Housing and Urban Affairs Committee

Subcommittee on Housing and Transportation


Hearing on Management Challenges Facing
the Department of Housing and Urban Development


Prepared Testimony of Mr. David Robinson
Senior Planner
Lake County Planning and Development Department
Lake County, Illinois


2:00p.m., Thursday, April 29, 1999



Good afternoon Mr. Chairman and members of the Subcommittee. My name is David Robinson and I am a Senior Planner with the Lake County (IL) Planning & Development Department. I am honored to appear to testify before you today on the subject of HUD's Integrated Disbursement and Information System or IDIS, as it is better known. I come before you representing the National Community Development Association (NCDA) and the National Association for County Community and Economic Development (NACCED). I am also a member of the IDIS Advisory Committee and the originator of a 400-member internet e-mail based mailing list about IDIS that serves as a forum for peer-to-peer based support and problem-solving.

I am pleased to have the opportunity to provide comments and recommendations to the Subcommittee on behalf of Lake County and its advocacy associations. NCDA and NACCED support HUD in its endeavors to improve, streamline and make more efficient grants management for its Community Planning and Development (CPD) programs.

There is ample opportunity for grantees to find common ground with HUD regarding IDIS. Making the CPD grant programs work is important to HUD and to its grantee communities. Our cities and counties have pressing needs, many of which are well-suited to some form of public intervention as communities strive to become and remain places of vibrancy, connectedness and opportunity for everyone. An essential part of realizing those ambitions are processes that are inclusive and transparent, so that everyone can participate in and stay informed of the plans and accomplishments of their community's initiatives. IDIS can be a key part of that as a tool for communicating the successes stemming from the use of public funds to support public goals. It is apparent to all of us that we are on the same side of the issues of affordable housing and community development.

The Changes Brought About by IDIS

IDIS is a computer system that captures information about what happens through the community development grant programs that HUD operates. Not only does IDIS replace less efficient tools for managing information about the grants, it also gathers more information and information of a higher quality than was previously available on grantees' activities. So really, there are three changes brought about by IDIS: more information, better information, and better management of that information.

Units of local government (cities, villages and counties) are most often where that information is created, as they take steps to build better-functioning communities within the parameters of the grant programs. Without grantees undertaking the wide variety of housing and community development initiatives, there are no financial transactions for which HUD would need to account and no accomplishments on which HUD would need to report. The changes brought about by IDIS are primarily changes impacting units of local government.

The introduction of IDIS has required grantees to provide much more data to HUD. For instance, in the CDBG program, grantees used to draw funds through a system that didn't provide HUD any information about how that money was being used. Now, every draw of CDBG funds is tied to the specific activity for which the funds are being spent. Whereas in the past a grantee could make one large draw of CDBG funds, say, once a month, now that one transaction has been replaced by perhaps fifty or one hundred transactions. The number of IDIS entries reaches into the thousands for some grantees. Clearly, grantees have always kept track of their expenditure of federal grant funds on their own computer programs but by inputting this additional data into IDIS, HUD can much more easily and quickly see where the funds are being spent.

IDIS also sought to reduce the barriers between HUD programs by using activities, rather than grant programs, as the primary reporting unit. An activity is any affordable housing or community development initiative undertaken by or on behalf of a grantee, and IDIS accommodates a great deal of flexibility for grantees to assign grant funding from various programs to an activity. Thinking primarily of the activity being undertaken rather than primarily of the grant program funding, the activity is another significant change introduced by IDIS. HUD's vision for IDIS of community development progress tracking and reporting without the constraints of programmatic lines has been hindered by reporting requirements of the programs, which by and large do not reflect the consolidated nature of our planning and reporting.

Also, as a real-time system, IDIS has fundamentally altered grantees' relationship to HUD in terms of reporting. For the first two decades of the CDBG Program, grantees reported once a year on their accomplishments. Ninety days after the end of our program year, we would mail off a report to HUD that detailed how much money had been expended on each activity, the status of that activity, and the people who benefited from it. Now, with IDIS, grantees are in a position to inform HUD instantly of any progress. The enhanced communication brought about by this computer technology is undoubtedly a good thing. It is, however, a change that has very far-reaching implications for the way HUD and grantees interact.

The Value of Those Changes

The goals that HUD is pursuing through the development of IDIS are right on target. Computer technology ought to be put to use to make for a more efficient, more responsive and more participatory government. Taxpayers have rightly increased their expectations for results and accountability for the use of their tax dollars. The cities, villages and counties that I represent face these increased expectations in countless ways every day. Similarly, HUD is also working diligently to provide a clearer picture to the entire country of the results of its activities. The ideas behind IDIS are fundamentally sound.

What Isn't Working

The fundamental problem with IDIS from my perspective stems from an inadequate appreciation on HUD's part of how the grantees are vital partners and a crucial link in the successful achievement of HUD's mission. The changes implicit in the introduction of IDIS have not received the attention they deserve. Significant problems with IDIS arise from poor communication and inadequate attention to aspects of the system that would make it work for HUD's partners. Additionally, there still exist some troubling technical problems that inevitably accompany this kind of large-scale automation project.

Partnering

HUD knows inherently that grantees are its partners in achieving its mission, but too often it behaves like a top-heavy, edict-issuing bureaucracy. At risk of calling attention to too small a problem, IDIS's reports, from the very beginning, have been formatted to print on an outdated wide-format, green bar paper. Without exception, grantees are better suited to printing on letter- or legal-sized paper with laser printers. It would be a small but symbolically important gesture to make the reports work at the level of physical formatting, a gesture that would acknowledge the importance of grantees' ability to extract and work with IDIS data.

On a positive note, HUD has made a point of including grantees in the review of the substantial rewrite of the user's manual for IDIS. I have had a chance to provide comments on a few of the chapters, and most likely in spite of my input, the new manual is turning out to be a significant improvement over the previous editions.

The discontinuation of the meetings of the national IDIS Advisory Committee is a concern to the extent that it represents a decline in HUD's commitment to continue working on the problems most on the mind of grantees and a decline in HUD's commitment to receive grantee input in proposed changes to the system. The discontinuation of the advisory committee has been accompanied by a noticeable rearranging of staff resources as HUD's new project, the Departmental Grants Management System project has gotten underway. Most alarming is the dearth of information about DGMS, which (from what we have been able to gather) will replace some but not all of the functionality of IDIS. In too many ways, HUD's handling of IDIS and DGMS has had the feel of something being done to grantees rather than something done with grantees.

Changing Expectations

As I have said, city and county government are quite familiar with the changing expectations being placed on them for better information and more accountability. What has been frustrating with IDIS is not the "raising of the bar" of gathering and providingmore information about the use of these grant funds. Rather, incompleteness and confusion has surrounded HUD's new reporting requirements. In order to make a system that accommodates four formerly separate grant programs, many of the unique requirements of one program were applied to all of the programs. For instance, in the CDBG program there has long been a system of coding activities, and that coding is maintained in a table called the Matrix Codes. The codes make sense for the kinds of activities that can be undertaken with CDBG funding because that is the program for which they were designed. Unfortunately, the codes do not fit all that well with the other programs, but we are required to assign every activity a code. Instead of undertaking a deliberate and inclusive process of redesigning the matrix codes, a few new codes were tacked onto the list, resulting in a confusing, unsatisfactory list.

I have mentioned "activities" several times this afternoon, but there is another unit of organization in IDIS that is an excellent example of the incompleteness and confusion that lingers around the system. "Projects" contain "activities" and in my opinion, the role of "projects" in organizing our data entry in IDIS has not received adequate attention from HUD. Many grantees have one project for every activity in IDIS. Some have one project for each grant program ­ CDBG, HOME, ESG, HOPWA. Some use projects to group activities into clusters by location or type of activity. On its face, the flexibility that HUD allows is commendable, but considering that HUD then designs a great deal of its reports around projects, it becomes problematic. Grantees that do not use "projects" in a way that fits with HUD's unspoken expectations will not find the reports that HUD designs to be useful.

From my perspective, one of the more significant changes accompanying IDIS is the change to a real-time reporting environment. With the HOME Program, there has always been real-time reporting. When an activity is completed, a completion report is submitted, and essentially all reporting on that activity is finished. In CDBG, with its history of annual reporting, there was a very different but equally clear definition of when an activity was "complete". Activities were complete when a grantee submitted an annual report that denoted which activities were complete and which were still underway. Activities that were completed in one annual report were then dropped from subsequent annual reports. That definition of completion left the designation more clearly in the hands of the grantee. As far as I understand, it is still somewhat unclear how and when we should stop counting beneficiaries for some CDBG activities.

Communicating

HUD has tried to improve its communication with grantees, and its efforts have been somewhat successful. HUD regularly prepares a newsletter that provides useful information, and they are working on an extensive rewrite of the user manual. The Technical Assistance Unit makes frequent use of my 400-member IDIS-USERS list-serve mailing list to distribute emergency and routine announcements about the system. On the whole, though, HUD has not done enough to keep grantees informed regarding its current expectations and its future intentions.

Reporting

The real-time nature of IDIS also has significant implications for financial reporting. Since we make available to our citizens annual reports of our accomplishments and expenditures, and since those reports are not distributed until approximately two and a half months after the end of our program year, during which time we make draws that are part of the next program year, it is essentially impossible to extract usable financial information from IDIS for the annual reports to our communities. As things currently stand, once our program year ends, we can either work on our annual report or we can continue drawing funds that will be a part of the subsequent program year, but IDIS does not accommodate both. In Lake County, we get around this dilemma by not using any output from IDIS in our annual reports, which obviously makes the system less useful for us than it could be to our community.

In addition to not being clear about changing expectations for reporting, HUD has not done enough to enable grantees to extract data from IDIS.

Additional Grantee Concerns

Although IDIS is becoming a workable system that can generate much needed data on HUD's CPD programs, it has caused much frustration for grantees who use it on a daily basis. There are still flaws that need to be corrected. Grantees currently interacting with IDIS have many concerns with the system as it now operates, including the following.

1) The system is labor intensive.

It requires an excessive amount of staff time to process payment vouchers and to input project completion information. To input the smallest amount of information, there are a large number of screens to visit because the system is concerned with four major CPD formula programs with uncoordinated reporting requirements. Many communities have had to hire additional staff just to keep up with data entry into IDIS. HUD's new Departmental Grants Management System should provide an excellent opportunity to design data entry sequences and screens that are more efficient.

2) Quality training is an ongoing concern.

We also must stress that employee turnover in the local community development offices, at HUD field offices and headquarters, and within the companies responsible for programming IDIS impacts everyone's ability to take advantage of the system and to incorporate into our respective organizations the changes it has brought about. Grantees are concerned about the continued training that will still be needed as staff turnover occurs. With a system as complex as IDIS, it will never be the case that training will no longer be necessary. Especially as HUD begins development of a system that will in some aspects replace IDIS, grantees are anxious about the level of continued support for IDIS. The downsizing of HUD, and other changes stemming from HUD's 2020 Management Reform Plan resulted in the loss of many senior career professionals and their valuable experience in adjusting to changes. The IDIS-USERS list-serve mailing list has also brought to light wide variability in the knowledge level and expectations among the various field offices. Consistent and clearly articulated expectations, made clear to field offices and grantees, are an essential part of moving forward with IDIS.

3) IDIS may further reduce their direct contact with field office representatives.

Even if IDIS was working exactly as HUD intended, with all the information that IDIS can provide, it can never replace the one-on-one personal contact of an on-site visit that a seasoned, dedicated HUD staff member can provide. With the advent of the Consolidated Plan, IDIS, HUD's 2020 Management Reforms and the new Community Builders initiative, many grantees feel less and less connected to their CPD grant representatives.

4) Program Income Problem.

This item a somewhat technical issue pertaining to accounting requirements governing the use of federal funds. When a HOME-funded activity, perhaps a loan to an affordable housing development, returns funds to the grantee, the grantee is bound by certain Treasury Department regulations regarding the use of that program income. IDIS currently does not adequately support the proper usage of HOME program income. Grantees across the country, and their auditors, have expressed concern about the inability of IDIS to support compliance with these federal regulations.

5) Electronic Data Interchange (EDI).

One bright spot has been HUD's commitment to work with larger grantees who have their own grants management software applications. HUD has been working to allow links between those databases and IDIS. This linkage, electronic data interchange, will provide maximum flexibility to grantees who can then control the user interface, the business rules and reporting, as long as their systems generate the data that IDIS requires. Private software development companies have already begun marketing EDI solutions to smaller grantees for whom building a custom interface to IDIS would not be cost effective. Lake County has scheduled a demonstration with one such firm next week.

Having a local information system that talks directly to the HUD system removes the HUD system from the grant administrator and contains the challenges within the local computer administrator's office. The attraction of EDI is the promise of entirely eliminating double-entry and the promise of complete flexibility for reporting. The major drawback to EDI is that it has proven to be very costly. Examples of costs for software and programming run from a low of $25,000 to a high of $60,000. These costs do not include system maintenance, which will be a serious consideration since HUD is still working on IDIS.

6) Grantees are concerned about how the new DGMS system will interface with IDIS.

HUD is in the process of developing an department-wide financial tracking system. Grantees have received very little information about the new Departmental Grants Management System and how it will relate to IDIS. HUD has been reluctant to collaborate with national public interest groups who represent grantees on this new system.

What Would Be Helpful to Grantees

The following is a list of suggestions and requests for HUD. Grantees are committed to working with HUD to make IDIS an effective tool for managing information about our community development initiatives.

1) Establish a working group for grantee input into DGMS.

NCDA and NACCED suggest that HUD establish a working group for DGMS as an avenue for public interest groups to provide their members' comments and concerns on this new system. We would like to be involved in the design and implementation plans for this new system from the onset. NCDA and NACCED would like to be involved in the creation of this new system from the onset. We suggest that HUD establish a working group as an avenue for public interest groups to provide their members' comments and concerns on this new system.

2) Increase communication with grantees, public interest groups, and the field offices on IDIS issues.

We would like to ensure that HUD engages grantees by reconvening the IDIS Advisory Committee meetings. Most of the advisory committee members have been involved with it for nearly two years. This committee has been a valuable source of open interaction, feedback and advance notification of planned modifications to the system. Unfortunately it has not met since September of 1998. Additionally, public interest groups such as NACCED and NCDA should be involved in the IDIS and DGMS systems in a more coordinated and open fashion. Field offices should also be working partners in IDIS and DGMS as HUD moves forward. Sometimes these people rely on grantees and public interest groups to determine the status of these systems.

3) Clearly articulate the vision of community development grants management.

HUD is undergoing some substantial changes that impact grantees ­ its 2020 Management Reform Plan has brought about a reduction in staffing levels at field offices, the Community Builders initiative has introduced a new category of HUD staff, the Consolidated Plan the SuperNOFAs have simplified our application processes, and IDIS has substantially changed how we access most of our grant funds and how we report on our progress. HUD field office staff and grantees are searching for a clearer understanding of how the pieces fit together in the context of doing the valuable work of assisting the revitalization of our low- and moderate-income communities. With expectations for increased accountability working their way into the culture of government, and with the tools of technology making possible new ways of working and communicating, HUD needs to work with its partners to think through new and better ways of getting the job done.

4) In collaboration with grantees, determine what kind of data should be gathered.

This is an issue that has been brought up time and time again. Grantees are putting in scores of data that are not seen as being useful to HUD, Congress, or to the grantees themselves. HUD and grantees need to determine what data is required and/or what is beneficial information to have on grantee activities.

5) Affirm the commitment to solving the technical and management problems surrounding IDIS.

Particularly, we urge HUD to have Internet access made available for IDIS users as soon as possible. We have heard that it would be available within the next few months, but the timeliness of this is crucial. The Internet will allow grantees to use IDIS more quickly and easily.

Conclusion

Lastly, if there is anything that the cities and counties that I am representing today could request of this subcommittee, it would be to support HUD's efforts and ours to build better ways of meeting the rising expectations of accountability and to make more responsive, accountable and inclusive processes with the new tools of technology. If the program statutes and regulations present outdated obstacles to building those more open and effective processes, please consider changes that would enable city and county governments across the country use these federal funds for the worthwhile purposes for which they are intended.

Mr. Chairman and members of the Subcommittee, HUD's Integrated Disbursement and Information System is the right idea moving in the right direction. I sincerely appreciate the opportunity to air my concerns and those of the cities and counties I am representing. We stand ready to work with HUD to make IDIS a useful tool for reporting to the country's taxpayers about the exciting things that are happening in our cities and counties through the housing and community development grants Congress makes available every year. We are also committed to supporting the Subcommittee as it seeks to ensure that the goals at the heart of IDIS, accountability and results, become realized throughout all communities.



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