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Audit finds Gov. Reynolds’ use of $21M in relief funds “not allowable,” staff payroll called “questionable”

DES MOINES, Iowa (KWWL) — In a news release Monday, Iowa State Auditor Rob Sand and the Treasury’s Inspector General found the misuse of pandemic relief funds for the state’s new HR system, referred to as Workday.

In a letter sent to the director of the Iowa Department of Management, Sand advised that the $21 million used for the system was not allowed under CARES Act expenditure requirements.

The CARES Act provides that payments from the Fund may only be used to cover costs that:

are necessary expenditures incurred due to the public health emergency with
respect to the Coronavirus Disease 2019 (COVID–19);

were not accounted for in the budget most recently approved as of March 27,
2020 (the date of enactment of the CARES Act) for the State or government; and

were incurred during the period that begins on March 1, 2020, and ends on
December 30, 2020.

Letter by Auditor Rob Sand sent to Iowa Dept. of Management

According to Sand, those funds must be corrected and that the money spent for the software didn’t fall under the “due to the public health emergency” clause.

As of this publishing, KWWL is awaiting comment from the Governor’s office. In the letter, Sand stated that the Governor’s Office justified the expenditure by saying the following:

“With Workday, the State of Iowa will be able to act quickly to assist essential government employees, giving them flexibility in a number of ways, such as requesting COVID-related hardship help, easier ways to request Family and Medical Leave Act leave types, and automate processes for donating leave, and borrowing leave.”

Sand also noted a review of the Governor’s decision to spend $448,449 of relief funds to pay staff salaries. While that act was not found to be a violation, Sand elaborated that the requirements for such payroll expenditures would only be for work done as it related to mitigating and responding to the COVID-19 pandemic.

“Most importantly, whether those conditions are met will only be judged in hindsight, upon an audit of the timekeeping records and supporting documentation. That means an inadequate focus on pandemic by those employees, or an indirect focus, and/or an inadequate record-keeping effort, could result in those funds also having to be repaid to the federal government. That would result in a loss for Iowa
taxpayers.”

Iowa State Auditor Rob Sand

The letter advised the Governor’s office to redeploy these funds to those that are “automatically” qualified.

View the full release and letter here:

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