Gov. Mike Pence to reorganize mysterious Indiana Office of Federal Grants and Procurement

Announcement planned for this summer

INDIANAPOLIS - Gov. Mike Pence plans to reorganize a mysterious government office years after the Call 6 Investigators exposed it was spending hundreds of thousands of dollars without clear results to show for it and without a full accounting of expenses.

Call 6 Investigator Kara Kenney has learned Pence will transform the Office of Federal Grants and Procurement, created by the administration of former Gov. Mitch Daniels in 2005 to bring Hoosiers more federal dollars, into a new office called the Office of State Based Initiatives .

Kenney has asked to speak with Pence about OSBI, but over the past six months, a spokesperson said Pence’s priorities have been cabinet appointments and the legislative agenda.

Communications Director Christina Denault said an announcement on the Office of State Based Initiatives is expected in late July or early August.

According to Pence’s website, OSBI will lead a task force to study the impact of federal regulations on Indiana and review all grant opportunities using a cost-benefit analysis.

"If the burdens outweigh the benefits, Indiana can and should tell Washington, ‘Thanks, but no thanks,’” read the website. "Moreover, OSBI will save the state money in the long run by helping Indiana maintain its fiscal solvency. During the last three years, the federal government has added almost $5 trillion in new debt and had its credit rating downgraded."

Given the history of the Office of Federal Grants and Procurement under Daniels, some are skeptical about Pence’s plan.

"We saw an issue of neglect with the previous administration, and I hope Gov. Pence is trying to do something positive," said House Minority Leader Rep. Scott Pelath, D-Michigan City. "You can call something whatever you want, but it's what you do once you've created the name."

Federal grants are vital because they help create and support programs to teach children, to grow food, to build and fix roads and to help treat people who are sick, among other things.

Lawmakers and watchdog groups argue Indiana needs to do a better job at securing a bigger piece of the federal money pie.

"You can have a debate over whether the federal government spends too much or whether they’re spending money on the right things, but Indiana ought to make the best out of it, and we’re frequently not," said Pelath. "You can see it in things like transportation funding. We are a donor state, sending our hard-earned tax dollars to Washington, and those dollars end up going elsewhere."

"Both Daniels and Pence have hostile attitudes toward the federal government, so therefore repeatedly miss opportunities for Hoosiers to participate in federal projects which could bring much needed resources to the state,” said Julia Vaughn, of nonpartisan watchdog group Common Cause Indiana. "I don't think changing the name of the agency will make any difference at all if they don't change their attitude."

A 2011 Call 6 Investigation revealed state information workers had not heard of the Office of Federal Grants and Procurement and directed RTV6 to the federal building. At the time, the OFGP website did not list a phone number, address or person in charge.

Instead, the website included a list of government liaisons that was so out of date, some of the contacts had not worked for the state in years and others told RTV6 they didn’t work with federal grants at all.

At least nine Republican lawmakers told Kenney in 2011 they had not heard of OFGP or did not know what it had been doing.

Records show OFGP spent about $600,000 since 2005, and the Call 6 team could not determine how those dollars helped secure more federal dollars for Indiana.

Following the Call 6 Investigation, the state updated the OFGP website with a new list of liaisons handling federal grants.

It’s not clear who will work for Pence’s Office of State Based Initiatives or where the office will be located.

"OSBI will help Indiana resist federal mandates in order to prevent the insidious undermining of state sovereignty that occurs as a state becomes more and more reliant upon federal dollars and the attached strings," read Pence’s website. "OSBI will help to shine a bright light on the costs of federal regulations on the state government, on local governments, and on Hoosier businesses."

"We don’t know what that means yet," said Pelath. "We don’t know if they have any enthusiasm for it. You have to put substance behind it."

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