Broadband: USDA Should Set Performance Goals and Improve Fraud Risk Management for Funding Program
Fast Facts
Since 2019, the Department of Agriculture's ReConnect program has awarded millions of dollars in grants and loans to broadband providers for expanding service in rural areas.
But USDA hasn't set specific goals for what it wants this program to achieve or for how it will measure how well the program is working. In addition, protecting the program from fraud is critical to ensure that federal funding is being used to increase rural broadband access.
Our recommendations to USDA include setting specific program goals for ReConnect and assessing fraud risks to help ensure that funds are used as intended.
USDA's ReConnect program aims to provide broadband to rural areas across the U.S.
Highlights
What GAO Found
The U.S. Department of Agriculture's (USDA) ReConnect program was established by statute and awards grants and loans to provide broadband service in rural areas. In 2019 and 2020, USDA conducted two rounds of funding in which applicants were able to apply for a grant, a loan, or a combination of the two, as shown in the figure. As of October 2022, USDA was reviewing applications for a third round of awards.
Rounds One and Two of ReConnect Awards, by Award Type and Households Served
USDA uses information from ReConnect and its other broadband programs to inform agency-wide performance goals, but has not set performance goals specific to ReConnect. For example, during the first two funding rounds, USDA used ReConnect data to support two department-wide performance goals—one on the number of new subscribers resulting from projects funded by ReConnect and other USDA telecommunications programs, and one on private investment resulting from certain USDA-funded projects. However, USDA did not establish performance goals that would define the specific results it expected ReConnect to achieve. Setting performance goals would help the department better determine if ReConnect is meeting expectations distinct from its other programs. Based on that information, it could then make informed decisions about the program.
USDA's oversight of ReConnect aligns with some but not all of the selected leading practices in GAO's fraud risk framework. The framework calls for: (1) designating an entity to oversee fraud risk management activities for a program, (2) documenting that entity's responsibilities, and (3) conducting and documenting a fraud risk assessment for a program, among other practices. USDA officials told GAO that its Office of the Chief Risk Officer is the designated entity to oversee fraud risk management for ReConnect. However, USDA officials have not documented this office's responsibilities specifically for fraud risk management. In addition, USDA officials have identified and considered specific fraud risks in ReConnect, but they have not conducted a fraud risk assessment for the program. Documenting the Office of the Chief Risk Officer's responsibilities for fraud risk management and conducting a fraud risk assessment would help USDA ensure that it routinely identifies and mitigates all potential fraud risks to the ReConnect program.
Why GAO Did This Study
A significant gap in broadband access remains between U.S. urban and rural populations, according to the Federal Communications Commission. The importance of closing the gap was highlighted during the COVID-19 pandemic, which has required many Americans to work, learn, and socialize from home. USDA's ReConnect program, which began in 2018, provides grants and loans to broadband providers serving rural communities to help close the broadband gap.
GAO was asked to review the ReConnect program. Among other objectives, this report examines the program's (1) performance goals and (2) alignment with selected leading fraud risk management practices.
GAO analyzed ReConnect award and application data from 2018 through 2021, and compared USDA's performance documentation to leading performance assessment practices. GAO also compared USDA's fraud risk management processes to GAO's fraud risk framework and interviewed USDA officials.
Recommendations
GAO is making three recommendations to USDA on ReConnect: (1) establish performance goals, (2) document the designated entity's responsibilities for overseeing fraud risk management activities, and (3) conduct and document a fraud risk assessment.
USDA agreed with these recommendations.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Agriculture | The Secretary of Agriculture should direct ReConnect program officials to establish program specific performance goals and use them to manage the program. (Recommendation 1) |
Previously, USDA said it will develop performance goals for ReConnect. In January 2024, USDA officials said they expect to complete this work by the end of June 2024. GAO will continue to monitor the agency's progress in implementing this recommendation.
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| Department of Agriculture | The Secretary of Agriculture should document that the Office of the Chief Risk Officer is the dedicated entity to design and oversee fraud risk management activities in the ReConnect program and outline this office's responsibilities consistent with leading practices as provided in our Fraud Risk Framework. (Recommendation 2) |
A significant gap in broadband access remains between U.S. urban and rural populations, according to FCC. USDA's ReConnect program awards grants and loans to provide broadband service in rural areas. In 2022, we evaluated the program's alignment with selected leading practices in GAO's Fraud Risk Framework, one of which is designating an entity to design and oversee fraud risk management activities for a program. We reported that USDA officials said that its Office of the Chief Risk Officer is the designated entity to oversee fraud risk management for ReConnect; however, USDA officials had not documented this office's responsibilities specifically for fraud risk management. Documenting the Office of the Chief Risk Officer's responsibilities for fraud risk management would help USDA ensure that it routinely identifies and mitigates all potential fraud risks to the ReConnect program. We recommended that USDA document that the Office of the Chief Risk Officer is the dedicated entity to design and oversee fraud risk management activities in the ReConnect program and outline this office's responsibilities consistent with leading practices as provided in our Fraud Risk Framework. In April 2024, USDA provided an updated fraud risk management policy for Rural Development, the mission area of USDA that houses ReConnect within the Rural Utilities Service. The policy states that the Chief Risk Officer oversees the fraud risk management program and outlines a number of specific duties under that oversight, including overall responsibility for the design, implementation, and leadership of the fraud risk management program. Having designated an entity for overseeing fraud risk management and outlining its key responsibilities will provide better assurance that USDA is protecting the ReConnect program from fraud.
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| Department of Agriculture | The Secretary of Agriculture should ensure that the Office of the Chief Risk Officer conducts and documents a fraud risk assessment for the ReConnect program that aligns with the leading practices outlined in our Fraud Risk Framework. (Recommendation 3) |
Previously, USDA said it plans to conduct and document a series of activities that will culminate in the production of the ReConnect program's fraud risk profile. In October 2023, USDA officials said they expect to complete this work in June 2024. As of October 2024, we are awaiting additional information from the agency about how their assessment efforts align with the leading practices in our Fraud Risk Framework. We will continue to monitor the agency's progress in implementing this recommendation.
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