Federal Assistance Improvement Act of 1981

Federal Assistance Improvement Act of 1981 - Title I: Consolidation of Federal Assistance Programs - Directs the President: (1) to examine Federal assistance programs at the beginning of each Congress to determine if consolidation of any such programs is necessary or desirable; and (2) upon making such a determination, to transmit to Congress a plan for consolidating functionally related programs. Requires that such a plan: (1) designate a single agency to administer the plan and the consolidated programs; (2) specify the terms and conditions under which such programs will be administered; (3) describe the difference between the terms and conditions of the programs before and after consolidation; and (4) state the total budget authority and outlays for each year of the plan with an explanation of how any budget reductions will be achieved.

Prohibits a consolidation plan from: (1) consolidating programs which are not functionally related; (2) designating as an administering agency any agency that did not administer one of the programs to be consolidated; or (3) increasing the total budget authority and outlays for all programs to be consolidated.

Terminates the consolidation authority under this title six years after it becomes effective. Directs the President to report to Congress within one year after such authority expires concerning the implementation of this title.

Declares that a consolidation plan shall become effective at the end of 60 calendar days of continuous session after it is transmitted to Congress, unless either House passes a resolution disapproving it. Sets forth House and Senate procedures for considering such a resolution.

Authorizes the aggregation of appropriations for programs consolidated under such a plan.

Title II: Financial Management and Audit of Federal Assistance Programs - Requires the Director of the Office of Management and Budget (OMB): (1) in consultation with the Comptroller General of the United States, to establish and maintain standard procedures to be used by all Federal agencies for the administration, accounting, and financial auditing of Federal assistance to State and local governments and nonprofit organizations; and (2) to prescribe directives to agencies for implementing such procedures and for coordinating Federal, State, and local audits of assistance programs.

Requires each State and local government and nonprofit organization which receives $25,000 or more in Federal assistance per year to use independent auditors to conduct a single financial audit of such government organization or any subgrantee thereof every two years (every five years if the recipient receives less than $100,000 per year).

Makes the Federal Government responsible for: (1) using the quality review process to assure the proper performance of such audits; and (2) conducting economy and efficiency audits and program results audits.

Directs the OMB to establish methods of payment of independent auditors for the expenses of performing audits of a Federal assistance programs.

Title III: Administration of Generally Applicable Federal Assistance Requirements - Amends the Intergovernmental Cooperation Act of 1968. Defines the term "generally applicable requirement" as any requirement with which a recipient of Federal assistance has to comply in order to achieve national policy objectives, and which applies to programs administered by two or more agencies.

Authorizes the President to designate Federal agencies to: (1) coordinate the preparation of national policy assistance standards for one or more generally applicable requirements in various subject areas; and (2) report on the implementation of such requirements. Directs each designated agency to develop such standards within one year of such designation and in consultation with Federal agencies and assistance recipients. Requires that such standards minimize the paperwork burden and compliance costs imposed on assistance recipients, include standard compliance procedures, and list the assistance programs to which they apply.

Directs each agency which administers a program to which such standards apply (assistance agency) to implement such standards within 120 days after they are published by a designated agency. Directs each designated agency to coordinate the implementation of such standards, and to insure that such standards are revised only on the first day of each fiscal year.

Requires all such standards to uphold the enforcement of statutory provisions against discrimination.

Requires the head of each assistance agency to designate a senior official to: (1) coordinate such agency's actions to comply with such standards; and (2) ensure active agency participation in the development and implementation of such standards. Authorizes such agency head to certify and accept State and local government requirements that contain the same requirements as national policy assistance standards. Directs assistance agencies to aid recipients in complying with such standards.

Directs a designated agency to report to the President concerning any impediments to the development of such standards. Permits the President to direct the agency to prepare a proposed bill to remove such impediments. Allows the President to submit to Congress proposed legislation exempting certain programs from inappropriate generally applicable requirements.

Authorizes the President to delegate responsibility for monitoring the overall implementation of this title to to the Director of OMB or the head of any other Federal agency.

Permits the President to: (1) establish a procedure for resolving disputes between designated agencies, assistance agencies, and assistance recipients over national policy assistance standards; and (2) publish a catalog of all such standards for generally applicable requirements in effect.

Title IV: Integrated Assistance - Amends the Intergovernmental Cooperation Act of 1968 to authorize each State or local government applying for Federal assistance to submit an integrated program plan representing an integrated approach to implementing several Federal assistance programs in the same subfunctional category of the Budget of the United States, and to provide for the administration of such plan by one agency.

Directs the head of the agency administering one or more of the covered assistance programs to establish requirements governing approval of such a plan, including requirements designed to: (1) increase the efficiency of such programs; (2) reduce the rigidity, duplication of effort, and unnecessary expenditures of assistance programs; and (3) permit State and local governments to redirect part of the resources in the covered programs to other priorities that cross existing statutory assistance categories. Authorizes assistance applicants to propose transferring up to 20 percent of the funds of any one covered program among other covered programs.

Requires an agency head to complete the review of a proposed plan in a timely fashion and to notify an applicant if its plans has been disapproved. Declares any plan not disapproved within 90 days after its submission to be approved. Declares that an approved plan shall be effective for only the fiscal year in which the application for funding is approved.

Requires States to consult with local governments when developing integrated program plans.

Terminates the authority provided under this title on September 30, 1985. Requires the Director of OMB to report to Congress by July 30, 1985, concerning the implementation of integrated program plans and recommendations on continuing integrated assistance.

Title V: Miscellaneous - Amends the Intergovernmental Cooperation Act of 1968 to repeal all requirements of Federal assistance programs intended to insure that Federal assistance does not reduce or replace relevant State or local government expenditures. Limits Congress to prescribing maintenance of effort requirements which: (1) require State or local governments to maintain the average expenditures for the aided program during the preceding two fiscal years or the Federal assistance will be reduced proportionate to the reduction in such expenditures; and (2) permit the administering agency head to waive the requirement if it would cause extraordinary fiscal hardship.

Prohibits any Federal law from diminishing or superceding practices established by State law for expending Federal funds, designating a State agency to administer Federal assistance, or reviewing State plans and applications for such assistance.

Permits an agency head to waive the applicability of major changes in the regulations governing grant administration or receipt with respect to a State or local government which has expended substantial time and money in administering or applying for such grant under the existing regulation.