A Project On Government Oversight analysis found that more than 74% of domestic federal grant spending lacked sufficient local-level data to show where the money was ultimately used.
By yourNEWS Media Newsroom
More than $712 billion in federal grant spending could not be traced to the cities, ZIP codes or communities where the money was ultimately used during fiscal 2024, according to a new analysis of federal spending records.
The Project On Government Oversight found that $712.6 billion of the federal government’s $958.6 billion in domestic grant spending — more than 74% — lacked sufficient information to follow the funds to the local level, according to reporting by Just the News.
POGO downloaded and analyzed federal award information from USAspending.gov, the government’s public database intended to show how taxpayer funds are distributed.
The watchdog’s report, released Tuesday, concluded that many of the largest federal assistance programs failed to provide adequate descriptions of how funds were used, where federally financed work occurred or how money passed from primary recipients to local organizations and service providers.
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The analysis covered the 60 largest domestic federal assistance programs, which together accounted for 92.3% of all federal assistance spending during fiscal 2024.
POGO examined both prime awards — the initial grants issued by the federal government — and sub-awards made by states, agencies or other primary recipients to local governments, contractors, nonprofit groups and additional entities.
The review also assessed whether agencies reported the geographic “place of performance,” meaning the physical location where federally funded work or services were carried out.
That information is central to determining whether money reached the communities for which it was intended and whether funds were distributed according to need.
Sean Moulton, a POGO senior policy analyst and author of the report, said federal spending cannot be meaningfully evaluated when records show only that money reached a state government or another large recipient.
“If we can follow the money down to the local level, we get a better chance of making sure it’s going to the communities that need it,” Moulton told Just the News.
“The reality is, if you just know how much money’s going to your state capital or something like that, you don’t know where it’s going,” he said. “That’s what USAspending.gov is supposed to be about: giving people a window into this federal spending.”
The public can search federal spending records directly through USAspending.gov, though POGO’s findings indicate that the available records often stop before identifying the final destination of grant money.
Only $198.3 billion, or 20.7%, of the $958.6 billion in reviewed federal grants contained local place-of-performance information in the prime-award data.
Sub-award records accounted for another $47.6 billion, or approximately 5%, that could be traced locally.
Together, those records left nearly three-quarters of domestic grant spending without enough information to determine where the funds were ultimately used.
Some of the federal government’s largest assistance programs reported particularly limited local data.
Of the $614 billion in federal Medicaid funding reviewed by POGO, only 0.2% could be followed to the local level.
The Children’s Health Insurance Program reported local information for just 0.1% of its $19.4 billion in spending.
Only 1.8% of the $8.2 billion distributed through Federal Transit Formula Grants could be traced to a local destination, while 0.5% of the State of Good Repair Grants Program’s $4.6 billion contained comparable information.
The report examined how well agencies and primary recipients disclosed sub-awards passed to other entities.
Such records are important because federal grants frequently move through several layers of government before reaching the organization that performs the work.
A federal department may award funding to a state agency, which can then distribute it to counties, cities, transit authorities, hospitals, school systems, nonprofits or private organizations.
If only the initial state-level award is reported, taxpayers may know which state received the money but not which communities, institutions or projects benefited from it.
Accurate place-of-performance reporting is therefore necessary for regulatory compliance and public transparency.
POGO also found significant shortcomings in transaction descriptions.
Approximately 97% of the 2.4 million transactions reviewed used descriptions that were duplicated elsewhere, according to the report.
Many descriptions were vague, repetitive or insufficient to explain the specific purpose of an expenditure.
Direct-payment programs provided unique descriptions for only 0.15% of transactions, while loan programs supplied unique descriptions for just 0.01%.
Those figures indicate that most database entries relied on standardized or repeated language rather than providing transaction-specific explanations of what the money financed.
Although 96.1% of direct payments were described as trackable in a broader sense, fewer than 3% of prime direct payments could be traced specifically to a city or ZIP code.
The report found that only $198.3 billion of all fiscal 2024 federal grants included a local place of performance in the prime-award records.
The Trump administration told Just the News that the accountability problems identified in the report support its effort to establish new federal grantmaking rules.
Administration officials said the proposed changes align with policies at the Office of Management and Budget.
The submitted information did not include the full text of those proposed rules, but the administration said they are intended to address weaknesses in federal grant oversight and reporting.
Treasury Department officials said they could not independently confirm POGO’s specific calculations.
They said Treasury Secretary Scott Bessent has continued pursuing measures to reduce fraud and prevent improper federal payments.
Officials pointed to a safeguard announced Tuesday to prevent payments from being issued to deceased individuals.
They also cited Treasury initiatives launched in January to combat alleged Somali fraud in Minneapolis.
Those efforts focus on improper payments and fraud, while POGO’s report primarily examined whether existing federal records allow the public and government officials to determine where assistance funds were spent.
A lack of local reporting does not by itself prove that money was stolen, wasted or improperly awarded.
It does, however, make fraud, duplication and ineffective spending more difficult to detect.
Without reliable local data, auditors may struggle to compare funding with community needs, identify areas receiving overlapping assistance or determine whether money financed the work described in an award.
Moulton said stronger reporting would also allow policymakers to evaluate whether federal programs are producing results.
Following funds to their final point of use could reveal whether certain communities receive too little assistance while others obtain more funding than necessary.
“We need to squeeze every bit of use out of federal dollars that we’re sending to communities,” Moulton said.
He argued that weak oversight sustained over many years could contribute to the nation’s nearly $40 trillion debt.
Poor tracking can lead the government to continue financing ineffective or duplicative programs because decision-makers lack the information needed to determine whether earlier spending succeeded.
Moulton said such weaknesses may cause the government to spend “more money over multiple years than we really should be.”
The report focused on federal reporting systems, but Moulton said state governments and agencies also bear responsibility.
States frequently serve as the primary recipients of federal grants and are expected to report how funds are divided among subrecipients.
When state agencies fail to submit accurate sub-award and location information, the federal database cannot show taxpayers where the money went after it left Washington.
Moulton said there is a “finger to be pointed” at state governments and agencies because they receive the funds and are responsible for recording subsequent distributions.
He called on the Trump administration, particularly the Office of Management and Budget and Treasury Department, to publicly identify programs that fail to meet transparency expectations.
The fiscal 2024 information was selected because POGO considered it the most complete and reliable dataset available for the analysis.
Moulton said more recent records can remain incomplete because significant portions of spending data may be submitted later.
Using a completed fiscal year reduces the risk that programs will appear less transparent merely because their reporting deadlines have not passed or records have not yet been uploaded.
Even with that additional time, the 2024 data showed that hundreds of billions of dollars remained untraceable below the state or prime-recipient level.
The findings suggest that the federal government’s transparency system records the beginning of many spending transactions without adequately documenting their final destination.
USAspending.gov was created to give the public access to federal award information, including recipients, amounts, agencies, program purposes and places of performance.
The usefulness of the database depends on agencies and funding recipients entering accurate, detailed and timely information.
When transaction descriptions are duplicated and geographic fields are missing, the site may show that an award occurred without explaining which local project or population received the benefit.
That limitation is especially significant for programs such as Medicaid, transportation grants and children’s health coverage, which distribute large sums through state-administered systems.
The $614 billion Medicaid figure accounted for most of the untraceable spending identified in the review.
Medicaid is jointly financed by the federal government and states, with state agencies administering benefits and payments to health care providers.
POGO’s finding that only 0.2% of the federal funds could be followed locally does not mean the remaining money disappeared. It means the federal spending database lacked the location detail necessary to connect most of those funds with specific communities or service areas.
The same distinction applies to the other programs evaluated.
Incomplete reporting prevents the public from determining whether spending patterns align with population, poverty, infrastructure condition, health needs or other factors used to justify federal assistance.
Improved sub-award reporting could allow auditors and residents to compare federal funding among neighboring communities and identify unexplained disparities.
Detailed transaction descriptions could also make it easier to distinguish legitimate recurring payments from duplicate or suspicious transactions.
The report recommends repairing those gaps so federal spending can be followed from the originating agency through states and other prime recipients to the final organization or project.
Moulton said accurate records are necessary both to serve communities effectively and to protect taxpayers from fraud.
“The last thing we need to do is get the spending wrong, send it to the wrong communities or send it to someone who’s defrauding the government and just putting the money in their pocket and running,” he said.
POGO’s analysis presents the problem as one of accountability rather than proof that all untraceable funds were misused.
The $712.6 billion figure represents spending that lacked adequate local-level information, not a finding that the entire amount was lost or fraudulent.
The scale of the missing data nevertheless limits the ability of Congress, federal agencies, watchdogs and the public to determine whether grant programs are operating as intended.
With federal debt approaching $40 trillion and grant spending nearing $1 trillion annually, the report argues that precise reporting is essential to prevent waste, measure results and ensure assistance reaches the communities it was created to serve.
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