ProgramCOVID-19 Federal Assistance e311
TopicsCompliance & Reporting, Due Diligence & Fraud Protection
Funding SourceAmerican Rescue Plan Act, CSLFRF, FEMA, HUD, Infrastructure Investments and Jobs Act
What is an Integrity Monitor? Are there good practices for demonstrating the cost-savings function of Integrity Monitors? Are there good practices for determining what percentage of a project’s budget should be dedicated to hiring an Integrity Monitor?
What is an Integrity Monitor?
Integrity Monitors are individuals or entities that provide integrated oversight services using professionals such as auditors, investigators, engineers, lawyers, compliance specialists, and other subject-matter experts. The oversight Integrity Monitors provide has helped prevent fraud, waste, and abuse on large infrastructure projects.
Below are key attributes of Integrity Monitors, who:
- Are integrated into infrastructure project teams and conduct proactive field and desk audits;
- Function independently from the project team contractors, vendors, and suppliers, and typically report directly to a municipality’s oversight agency.
- Often report to other appropriate agencies, such as a city’s Chief Financial Officer or General Counsel’s Office.
Integrity Monitors’ high visibility creates a culture of integrity on municipal project teams and their contractors, vendors, and suppliers, resulting in cost-savings through the prevention of waste or criminal conduct. For example, the commissioner of the New York City Department of Investigation (“DOI”), who utilized Integrity Monitors to oversee the cleanup of the World Trade Center after the 9/11 attacks, stated that::
“[A]n intercepted conversation between two organized crime associates [revealed] that the on-site presence and close scrutiny of the [integrity] monitors at the World Trade Center [made] it impossible for anyone to overbill New York City using the usual scams.”
Integrity Monitors have uncovered Criminal and wasteful practices that have resulted in tangible cost-savings. For example, the New York DOI noted that Integrity Monitors oversight resulted in cost-savings of approximately $30 million in potential waste and mismanagement from the federally funded repairs and cleanup efforts from Hurricane Sandy .
What are good practices to demonstrate the cost-savings function of Integrity Monitors?
To demonstrate how Integrity Monitors can save costs, they should document their activities, including monitoring, audits, investigations, forensic reviews, and policy recommendations. The Integrity Monitor should highlight actions that resulted in cost-savings or where they uncovered improper practices that would have resulted in lost funds, including the amount of savings.
Any identified improper practices should be documented, supported by photographs, and summarized in monthly Integrity Monitor activity reports that are submitted to the overseeing municipal agency. The frequency of these reports can vary depending on the size and scope of the Integrity Monitor assignment.
What are good practices to determine what percentage of a project budget should be used to pay for Integrity Monitors?
An important factor in properly scoping an Integrity Monitor budget is the creation of a project risk assessment, which can be used to focus the efforts of the Integrity Monitors. Consideration should also be given to the amount of federally funded administrative and managements costs, if any, to ensure that the total costs for Integrity Monitoring services are reasonable in relation to the total amount of program funds being administered.
Some government agencies in New York and New Jersey have used 0.5% to 1% of a project’s budget to estimate a baseline Integrity Monitor budget. This percentage range has only been used as a guideline in the past, as numerous other factors, including issues identified during a risk assessment and other issues uncovered during the Integrity Monitor’s monitorship, may also affect budget amounts.
Last Updated: February 7, 2023
 United States House of Representatives, Subcommittee on Management, Integration, and Oversight of the Committee on Homeland Security, “An Examination of Federal 9/11 Assistance to New York: Lessons Learned in Preventing Waste, Fraud, Abuse, and Lax Management,” at 17, available at https://www.hsdl.org/?abstract&did=27781.
 State of New Jersey COVID-19 Compliance and Oversight Taskforce “Integrity Oversight Monitor Guidelines: 2021 Update” at 13, available at: https://www.nj.gov/comptroller/doc/Integrity%20Monitor%20Guidance%20Updated%20June%202021.pdf.