Using blockchain to improve data management in the public sector
February 2017 | ArticleNSF explores blockchain for grants management
The National Science Foundation is investigating blockchain's potential for making the grants review and award process more efficient.
The Grants Community Blockchain would allow agencies such as the National Institutes of Health and the Treasury Department to share a blockchain with NSF to keep track of grant applications in order to avoid duplication's.
“At NSF, we take ideas from the outside world in the form of proposals, and program officers work to set up panels of reviewers to assess the quality of those ideas,” NSF CIO Dorothy Aronson told GCN. “This blockchain would be a way of helping NSF and other agencies avoid duplication of review and funding of similar ideas so we can fund science more quickly.”
The blockchain would notify member agencies any time that a grantmaking proposal comes into NSF, which could then determine whether that proposal has been already been funded by a specific agency. The information would allow program officers to determine if a proposal would make more sense for another agency to support.
In theory, the Treasury Department could also be on the blockchain so it could directly fund projects after a program officer has approved it. Likewise, universities would be able to see the status of their grant applications through the blockchain.
“The initial thinking is to validate if we can establish blockchain at all to establish a linkage between NIH or another peer agency that we haven’t specifically identified yet,” Aronson said. “The chain over time could be very large and manage many kinds of transactions.”
The goal of this initiative is to reduce the workload for program officers so they can focus on higher-level tasks, like "strategic thinking, traveling and learning,” Aronson said. “While they are reviewing proposals, they don’t have the opportunity" to attend conferences and to learn about more cutting-edge technologies that should be funded by NSF.
“There is a problem in the research environment where we want to know that we are funding the right thing. If we are funding something similar to something someone else is funding, it’s not necessarily the best use of our funds. We are trying to always find the best way of granting the money,” Aronson said.
The work to create the blockchain is being funded by theGeneral Service Administration’s 10x program, which helps to fund small-scale experiments at government agencies.
Sara Friedman is a reporter/producer for GCN, covering cloud, cybersecurity and a wide range of other public-sector IT topics.
Before joining GCN, Friedman was a reporter for Gambling Compliance, where she covered state issues related to casinos, lotteries and fantasy sports. She has also written for Communications Daily and Washington Internet Daily on state telecom and cloud computing. Friedman is a graduate of Ithaca College, where she studied journalism, politics and international communications.
Friedman can be contacted atsfriedman@gcn.comor follow her on Twitter@SaraEFriedman.
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Assessing the Potential to Improve Grants Management Using Blockchain Technology
June 2019
Topics: Government Agency Operations, Grants Management, Computer Methodologies, Distributed Ledger/Blockchain
Jasmine A. Faubert, The MITRE Corporation
Tracey G. Amos, The MITRE Corporation
Bianca N. Piccione, The MITRE Corporation
MITRE’s study results support the hypothesis that improvements in grants management for both federal agencies and grant recipients can be enabled through the use of blockchain technology. The primary benefit to federal agencies was improved decision making through improved transparency, quality, and timeliness of grant financial and performance information. The primary benefit to grant recipients was reducing redundant reporting to multiple grantmaking entities and auditors. Payment efficiency was a secondary benefit.
Achieving the identified benefits will require addressing the Actions Needed items identified by those we interviewed, as well as other actions to mitigate the challenges and barriers identified by the interviewees. Those most often cited were:
- Control of access to and protection of personally identifiable information (PII) and sensitive/proprietary information
- Need for artificial intelligence and analytics to make effective use of all the information
- Changes to regulations, policies, and procedures to clearly define responsibilities and accountabilities in a new business operating model where federal and non-federal grants management processes are more integrated
Five potential barriers were identified related to the impact on states based on the few states interviewed; the magnitude and extent of the impact across all states is not yet known.
Findings in three key communities are described below.
Grants Management Community:
...
4.4.1 Description of Environment (brief)
Grantors and Applicants research and address significant challenges in society. Collaboration is time-consuming; whether in identifying funding needs of researchers, resourcing potential requests for proposals/applications (RFP/RFA), or reporting progress and results. International and in-country organizations spend too much time locating potential grantors and those grantors spend too much time administering grants when they yearn to link with the research community in innovation rather than a maintenance role. All parties prioritize researching, analyzing, and disseminating; however, the business burden of grants compliance overshadows the incredible potential of significant adoption of grants-related research.
4.4.2 Use Case
Name
The Grant Lifecycle
Description
Identification, Application, Implementation, and Dissemination phases of the grant lifecycle complement blockchain strength in identity, provenance, and security.
Primary Actors
Grantor and Applicants
Supporting Actors
Multiple stakeholders in Grantor and Applicant organizations, external researchers, and grants participants
Use Case
Securing and Connecting Grants
Description
High-Level Summary The grant process follows a linear lifecycle that includes creating the funding opportunity, applying, making award decisions, and successfully implementing the award. These phases are grouped as:
- Pre-Award Phase - funding opportunities and application review
- Award Phase - award decisions and notifications
- Post Award Phase - implementation, reporting, and closeout
Low-level Summary
Primary Actor
Grantors and Applicants
Grantors:
- Review process
- Inter- and Intra-departmental share among agencies
- Track applications and avoid duplication
- Notify member agencies
- Fund projects
- Support informed decision making by federal grant-making entities
- Integrate with grant-making and grant recipient entities’ systems used to manage day-to-day grants management operations
Financial Management Community:
- Improves transparency, quality, and timeliness of financial information
- Must be integrated with payment request and processing systems
Inspector General Community:
- Improves Improve ability to detect fraud, waste, and abuse
- Improves Improve ability to efficiently conduct audits
Based on our study results, we developed recommendations should the federal government seek to pursue implementation of the proposed grants management business operating model and a Distributed Grants Ledger solution based on blockchain technology.
We recommend the federal government set up a grants management blockchain demonstration project, or proof of concept. A demonstration project would test a subset of Benefits and further explore a subset of Actions Needed, Challenges, and mitigation actions and engage a consortium of federal, public, and private sector grantmaking and grant recipient entities to evaluate the results.
We recommend that in parallel with a demonstration project, the federal government initiate further analysis of complex challenges and barriers and determine the magnitude and the extent of the state-related Barriers. In addition, the federal government should, also in parallel, prioritize, sequence, and further analyze Actions Needed and mitigation actions identified by the study to ensure successful adoption of the proposed business operating model and blockchain technology.
4.4.1 Description of Environment
4.4.2 Description via four rings
...
Applicants:
- Reduce redundant reporting
- Control of access to and protection of personally identifiable information (PII) and sensitive/proprietary information
- Integrate federal and non-federal grants management processes
- Improve payment efficiency for second- and third-tier grant recipients
- Notify RFA and RFP based on selected topics
Supporting Actors
Multiple stakeholders in Awardee and Applicant organizations, external researchers, and grants participants:
<List the Actors who have a supporting role in helping the Primary Actor achieve his or her goal.
Stakeholders and Interests
Pre-Conditions
Post Conditions
Success condition
Failure condition:
Minimal Guarantee
Trigger
Main Success Scenario
Extensions
Variations
Frequency:
Assumptions
Special Requirements
Issues
Outcome
4.4.3 Recommendations
- Identity, Interactions, Regulations and Governance