Audit finds lack of oversight in North Carolina’s COVID-19 relief spending
(The Center Square) – The state agency responsible for overseeing North Carolina’s Coronavirus Relief Fund did not ensure taxpayer money was spent according to law or achieved its intended purposes, a state audit found.
State auditors said the North Carolina Pandemic Recovery Office’s (NCPRO) lack of oversight put billions of dollars in federal aid at risk for misuse.
“As a result, there was an increased risk that recipients could have misused the funds without the misuse being detected and corrected timely,” auditors wrote in a report published Thursday.
Federal regulations, however, required NCPRO to monitor coronavirus relief spending.
North Carolina used $3.6 billion of its Coronavirus Aid, Relief and Economic Security (CARES) Act allocation to establish the Coronavirus Relief Fund in May 2020. Legislators earmarked the funding to state agencies, local governments, hospitals and schools and to offset the state’s general fund.
Auditors reviewed the distribution from the fund from March 1, 2020, through Nov. 30, 2020, excluding the more than $300 million that was provided directly from the federal government to local governments. They found the NCPRO did not independently verify the $3.1 billion allocated to other sources was spent according to law until November.
“However, all of the information that NCPRO used for monitoring was self-reported by recipients,” auditors said.
Schools received more than $520 million. Nonprofits received more than $340 million, and hospitals received $102 million, according to the report.
The NCPRO distributed $167 million to state agencies, and the state used $645 million to offset its general fund.
Auditors said NCPRO did not ensure the organizations and agencies that received the funding created objectives for the funds, set goals for accomplishing those objectives or measured their progress.
Auditors said out of 490 organizations and agencies that received the funding through October 2020, 68% reported their objectives for the funds but did not set goals for how they would accomplish them. Another 39% of recipients reported objectives for the funds and goals for accomplishing their objectives but did not measure their progress toward meeting their goals.
NCPRO said it did not independently verify spending before November 2020 because the agency was short-staffed and officials prioritized coordinating and distributing money and providing technical assistance to recipients. NCPRO officials said it took longer than expected to complete because of the constantly changing federal guidance on how the funds could be used.
“NCPRO acknowledges that a lack of staffing and funding and the temporary nature of NCPRO contributed to the state auditor’s finding that the recipient’s performance measures were not as robust as they could have been to measure legislative intent and take remedial action with recipients when necessary,” State Budget Director Charles Perusse and NCPRO Executive Director Stephanie McGarrah said in a joint letter.
Auditors said the General Assembly should consider including specific monitoring requirements in future COVID-19 funding legislation.
Disclaimer: This content is distributed by The Center Square
