An Audit Report on
Grant Management at the Cancer Prevention and Research Institute of Texas and Selected Grantees
SAO Report No. 13-018January 2013
This audit was conducted in accordance with Texas Government Code, Section 321.0132.For more information regarding this report, please contact Cesar Saldivar, Audit Manager, or John Keel, State Auditor, at (512) 936- 9500.
Cancer Prevention and ResearchInstitute of Texas
In 2007, Texas voters approved a constitutionalamendment establishing the Cancer Prevention andResearch Institute of Texas (CPRIT), which may receivebond funding of $300 million on an annual basis to fund itsgrants and associated operating costs. The total amountof bonds that can be issued for CPRIT cannot exceed $3.0billion. From September 1, 2009, through August 31,2012, approximately $363.5 million in bond debt wasissued to support CPRIT (see Appendix 8 for moreinformation). As of October 1, 2012, the Texas PublicFinance Authority had paid debt service that totaled $30.9million in principal and interest payments on CPRIT’s bonddebt.As of August 31, 2012, CPRIT reported it had awarded 575grants totaling approximately $797.8 million, for which itreported disbursing $104.2 million in reimbursements and$40.2 million in advance payments (see Appendices 2 and4 for more information on grants and payments,respectively).CPRIT awards three categories of grants:
- These grants fund preventionservices such as outreach, screenings, and training ofhealth professionals. CPRIT is statutorily limited toawarding no more than 10 percent of its funds forprevention grants during any year.
– These grants support various typesof cancer research projects, including basic research,translational research, and clinical applications. Inaddition, research grants support the recruitment andretention of distinguished researchers, enhancementsto research facilities, and the acquisition of majorresearch equipment.
– These grants finance thedevelopment of products and services for cancertreatments by new or existing businesses.For fiscal year 2012, CPRIT was appropriated 24 full-timeequivalent (FTE) positions. For the quarter ending August31, 2012, CPRIT had 23.3 FTE employees. CPRIT isgoverned by an oversight committee that consists of thefollowing 11 members:
Three members appointed by the Governor.
Three members appointed by the Lieutenant Governor.
Three members appointed by the Speaker of the Houseof Representatives.
The Comptroller of Public Accounts or the Comptrollerof Public Accounts’ designee.
The Attorney General or Attorney General’s designee.
The Cancer Prevention and ResearchInstitute of Texas (CPRIT) shouldsignificantly improve the transparency andaccountability of its grant managementprocesses. Weaknesses in CPRIT’sprocesses reduce its ability to properlyaward and effectively monitor its grants.Specifically, CPRIT should addressdeficiencies in the following areas:
Making award decisions.
Evaluating grant applications.
Verifying compliance with matchingfunds requirements.
Processing payments to grantees.
Monitoring grantees’ expenditures.
Assessing and measuring researchprogress.
Managing contract agreements withgrantees.
Making Award Decisions
CPRIT should ensure that all awarddecisions are free from real or apparentconflicts of interest. The executive directordiscussed award recommendations withcertain members of the oversightcommittee prior to presenting therecommendations to the full oversightcommittee. Also, CPRIT’s chief scientificofficer, chief commercialization officer,and director of scientific review had officelocations on the campuses of higher