WASHINGTON- Claims by the Department of Health and Human Services that federal bioterrorism grants for states and localities were sitting unused and unneeded are not true, although HHS cited those reasons to redirect the money for spending on other programs, Senator Edward Kennedy, Ranking Member on the Senate Health, Education, Labor and Pensions Committee, and Senator Joe Lieberman, Ranking Member on the Senate Homeland Security and Governmental Affairs, conclude based on a Government Accountability Office report.

Kennedy and Lieberman said Wednesday states and localities had obligated almost all of their Fiscal Year 2002 and 2003 grant money and that a surplus was not evident. As a result of HHS’s decision to reprogram a portion of the 2004 grant money, 34 states lost funds they had planned to commit to a variety of preparedness programs.

In May 2004, Lieberman and Kennedy asked GAO to investigate state spending of bioterrorism grants after HHS Secretary Tommy Thompson informed Congress he intended to shift $54.9 million in grant money to other programs. He said states had drawn down only 30 percent of Fiscal Year 2003 funds and that 18 percent of FY 2002 funds remained unused.

But GAO found that states had committed approximately 80 percent of their 2003 funds, and 86 percent of their 2002 funds.

“This report makes clear what we knew all along. States have lived up to their responsibilities to protect their citizens from bioterrorism,” Kennedy said. “There’s no justification for diverting these funds to other purposes, and I urge the Administration to restore the funds as soon as possible. We know the danger, and we can’t afford to be caught unprepared.”

“If HHS had looked closely at what states and localities were doing with their grants, as GAO did, it would have realized that states were using the grant program to better prepare themselves for a bioterror attack,” said Lieberman. “Instead of working with jurisdictions to figure out what was going on, HHS reprogrammed the funds and undermined the ability of states and local governments to improve the very bioterrorism capabilities the grants were intended to create. States and local governments need more bioterrorism funding, not less.”

GAO also looked at why it took some states longer than others to use the bioterrorism funds. Contrary to the HHS conclusion that states and localities did not need the unspent grant funds, GAO found that some jurisdictions faced hurdles such as a lack of funding or staff to process the grant funds due to state budget cuts and hiring freezes. In Connecticut, for example, GAO reported that state budget problems resulted in the “loss of approximately 60 health agency employees including the entire unit that was handling bioterrorism contracts.”

GAO also reported that states and localities faced a shortage of vendors to install bioterrorism equipment and services, difficulty in hiring new personnel because state and local salaries were not competitive with federal and private sector health positions, and a national shortage of qualified public health workers.