The OMB released guidance to Federal departments and agencies on the use of evidence and evaluation in FY 2014 Budget today. Agencies were directed to demonstrate the use of evidence in their FY 2014 budget submissions. Budget submissions also should include a separate section on agencies’ most innovative uses of evidence and evaluation.
I am going to highlight sections of the memorandum as it relates to research.
Expansion of Evaluation Efforts within Existing Programs
In addition to specifying evaluations to be performed with dedicated funding, agencies can also add a general policy and requirements favoring evaluation into existing grants, contracts, or waivers. These measures may require new legislation.
Systematic Measurements of Costs and Cost Per Outcome
Agencies are encouraged to include measurement of costs and cost per outcome as part of the routine reporting of funding programs to allow for useful comparison of cost-effectiveness across programs. Agencies should release evaluations promptly through either their agency websites or alternative means. OMB particularly welcomes agency proposals to improve public access to, and understanding of, evidence about what works and what does not.
Infusing Evidence into Grant-Making
Grant-making agencies should demonstrate that, between FY 2013 and FY 2014, they are increasing the use of evidence in formula and competitive programs. Agencies should consider the following approaches, among others:
Encouraging Use of Evidence in Formula Grants – OMB invites agencies to propose ways to increase the use of evidence-based practices within formula grant programs. For example, formula funds can be conditioned on the adoption of evidence-based practices, and high-quality technical assistance can be used to share and support implementation of evidence-based practices. Competitive programs can assign points to applicants based on their integration of such practices into formula streams.
Evidence-based Grants – Several agencies – ranging from USDE to AID – have implemented evidence-based grant programs that apply a tiered framework to assess the evidence supporting a proposed project and to determine appropriate funding levels. Under this approach, programs supported by stronger evidence, as established in a rigorous agency process, are eligible for more funding. All programs are expected to evaluate their results. Examples of tiered-evidence programs include USDE Investing in Innovation program and HHS Teen Pregnancy Prevention and Home Visiting programs.
Pay for Success - Taking the principle of acting on evidence one step further, DOL and DOJ will be inviting grant applicants to use a “Pay for Success” approach, under which philanthropic or private entities (the “investors”) pay providers upfront and are only repaid by the government if certain outcomes are met. Payment amounts are based, in part, on the amount that the Federal, State, or local government saves. A pay-for-success is appropriate where: (i) improved prevention or other up-front services can produce better outcomes that lead to cost savings at the Federal, State, or Local level; and (ii) foundations or others are willing to invest.
OMB invites agencies to apply a pay-for-success model for programs funded by either discretionary or mandatory appropriations. Agencies should also consider using the new authority under the America COMPETES legislation to support incentive prizes of up to $50 million.
To read OMB Memorandum M-12-14, click on OMB M-12-14 Evidence and Evaluation in FY 2014 Budget