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092845 1 (1970-10-14)

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OCT   4 1370


rmS  rark  C. Smith, Area DIreator
We-tern Arma OfTice
econmic  Devlopmeat   Af  nitrationu
41S firt   Wea    North-
  ;1 B        h       109


UNITED STATES  GENERAL ACCOUNTING  OFFICE
             REGIONAL  OFFICE
    3086 FEDERAL, OFFICE BUILDING, 909 FIRST AVENUE
         SEATTLE,,WASHINGTON 98104


Dear Mr.  Smith;

      a lave  completed our survey of ionstruction   anumnt activities
in the  westero Area office of the  Zconomie Dee0ment Admiatratio,,
The purpose  of our  *urvey own to review and evaluate the nolicies
And  procedurea of the Construction Maaeoent Brarne in adnin.Ctrn
publiw   oti projects,. To 'dtersioe  wtharer these poliieo  and  p roedure
une bing properly impleoented by the Construction     naoent franch,
ye revieved  16  alectad projoet  fil   for  ompl     a   in- process
public  works prtojects.

      de appmroiate Our recent oyportunity  ti diecue  wit  your  staff
the  results of burw  urvey  We  found that the polce4   and procedures
o-f the Contructitin Maeamet     arench include Aevertl cnatrols  to
ad~;~eq aly Totect  the tkvernnrts interest prter to and duri   n   the
consttructdn  of EA  pulblc 1 works projects. Gtnernlly.  ,e found taat
these  policies and prtcedur!e were  being proerl>  ivr leeated  by tle
UCcnraction   ?4aagCement iBrarnch; howeover we noted two itorws which nay
te of  interest to you In itprving   the manngement of ccistruction
activitles.   Theoe matterts, dlh   we have dircssed  wi:    ammer  of
your  staff, are briefly diecussed  telow.

Pihbursemsat  of Grant  unds

     You  My   ish tn obtain  approva  of the carrent diaBurnament  proc-
 tide boing foloed   on Projects with  overruno finanend by  the Granttoe/
 torrower.  The  racotice now hefn  folk-ed  by yaor office  FOAy he an
 acceptable alternative to entablished  proced0a  which cou
 implwemrted by other tDA o-ffices-

      Sresent procdurcs  r.eu±re   utat, in the evoent of an overrun funded
by  the Gamntee/lerrever, grant  disburseents  are to be  based on a
revised  nrfrt rate that is equai  to the EA  4plooved grant auount
divided  by the revised total  project coots,   a noted  that on throe
projects  w-ith lage ogverrun  fin aced b  the Gurat/Rorrowet, the
revised  grant rate was compuotdd based upon the cols; of selected line
ioes   rather thtan total project cets.   lThis procedure dlee nt  effect

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