Full text
OFFICE OF
INSPECTOR GENERAL
DEPARTM ENT OF THE TREASURY
WASHINGTON, D.C. 20220
July 27, 2023
MEMORANDUM FOR JESSICA MILANO, ACTING CHIEF RECOVERY OFFICER,
DEPARTMENT OF THE TREASURY
FROM:
Deborah L. Harker /s/
Assistant Inspector General for Audit
SUBJECT:
Desk Review of State of Ohio’s Use of Coronavirus Relief
Fund Proceeds (OIG-CA-23-037)
Please find the attached desk review memorandum1 on State of Ohio’s (Ohio) use
of Coronavirus Relief Fund (CRF) proceeds. The CRF is authorized under Title VI of
the Social Security Act, as amended by Title V, Division A of the Coronavirus Aid,
Relief, and Economic Security Act (CARES Act). Under a contract monitored by
our office, Castro & Company, LLC (Castro), a certified independent public
accounting firm, performed the desk review. Castro performed the desk review in
accordance with the Council of the Inspectors General on Integrity and Efficiency
Quality Standards for Federal Offices of Inspector General standards of
independence, due professional care, and quality assurance.
In its desk review, Castro personnel found that Ohio complied with the quarterly
Financial Progress Reports (FPR) reporting timeline as required under the
Department of the Treasury’s (Treasury) guidance for Cycles 12 through 8.3 In
addition, Castro personnel reviewed documentation for a selection of 48
transactions reported in the quarterly reports through Cycle 8.4 Castro personnel
found that Ohio’s CRF expenditures for Contracts greater than or equal to $50,000,
Direct Payments greater than or equal to $50,000, Aggregate Reporting
1 The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) assigned the Department of
the Treasury Office of Inspector General with responsibility for compliance monitoring and
oversight of the receipt, disbursement, and use of Coronavirus Relief Fund (CRF) payments. The
purpose of the desk review is to perform monitoring procedures of the prime recipient’s receipt,
disbursement, and use of CRF proceeds as reported in the grants portal on a quarterly basis.
2 Calendar quarter ending June 30, 2020.
3 Calendar quarter ending March 31, 2022.
4 Calendar quarter ending March 31, 2022.
Page 2
for transactions less than $50,000,5 and Aggregate Payments to Individuals6
complied with the CARES Act and Treasury’s Guidance.
Castro determined that Ohio’s expenditures related to Grants greater than or
equal to $50,000, and Transfers greater than or equal to $50,0007 did not comply
with the CARES Act and Treasury’s Guidance. Castro questioned ineligible
expenditures of $30,705.68 and unsupported expenditures of $25,000.00 related to
Grants greater than or equal to $50,000. Additionally, Castro questioned ineligible
expenditures of $31,095.52 related to Transfers greater than or equal to $50,000
because Ohio management used CRF for severance pay, which is an ineligible
expense. In total, Castro identified questioned costs of $86,801.20 and determined
Ohio’s risk of unallowable use of funds is low.
Castro is not recommending that Treasury Office of Inspector General (OIG)
personnel perform an audit of Ohio. However, Castro recommends that Treasury
OIG personnel pursue obtaining documentation from Ohio management and
follow-up on necessary reporting corrections for Grants greater than or equal to
$50,000 and Transfers greater than or equal to $50,000. In addition, Castro
recommends that Treasury OIG personnel pursue obtaining information from
Ohio management to determine whether there are ineligible severance pay
transactions in addition to those already identified as part of the desk review.
Treasury OIG and Castro met with Ohio management to discuss the questioned
costs. Ohio management told us that they plan to make updates to the grants
portal in subsequent cycle submissions, which they believe will address all the
findings contained in this report.
In connection with our contract with Castro, we reviewed Castro’s desk review
memorandum and related documentation and inquired of its representatives. Our
review, as differentiated from an audit performed in accordance with generally
accepted government auditing standards, was not intended to enable us to
express an opinion on Ohio’s use of the CRF proceeds. Castro is responsible for
the attached desk review memorandum and the conclusions expressed therein.
Our review found no instances in which Castro did not comply in all material
respects with the Council of the Inspectors General on Integrity and Efficiency’s
Quality Standards for Federal Offices of Inspector General.
5 Recipients are required to report CRF transactions greater than or equal to $50,000 in detail in the
grants portal. Transactions less than $50,000 can be reported as an aggregate lump-sum amount
by type (contracts, grants, loans, direct payments, and transfers to other government entities).
6 Obligations and expenditures for payments made to individuals, regardless of amount, are
required to be reported in the aggregate in the grants portal to prevent inappropriate disclosure of
personally identifiable information.
7 A transfer is a disbursement or payment to a government entity that is legally distinct from the
prime recipient.
Page 3
We appreciate the courtesies and cooperation provided to Castro and our staff
during the desk review. If you have any questions or require further information,
please contact me at (202) 486-1420, or a member of your staff may contact Lisa
DeAngelis, Deputy Assistant Inspector General for Audit, at (202) 487-8371.
cc:
Michelle. A. Dickerman, Deputy Assistant General Counsel, Department of
the Treasury
Victoria Collin, Chief Compliance & Finance Officer, Office of Recovery
Programs, Department of the Treasury
Christopher Sun, Director of Data and Reporting, Department of the
Treasury
Stacie Massey, Deputy Director, Grants and Financial Reporting, Ohio Office
of Budget Management
Wayne Ference, Partner, Castro & Company, LLC
Page 4
Attachment
Schedule of Monetary Benefits
According to the Code of Federal Regulations,8 a questioned cost is a cost that is
questioned due to a finding:
(a) which resulted from a violation or possible violation of a statute,
regulation, or the terms and conditions of a Federal award, including for
funds used to match Federal funds;
(b) where the costs, at the time of the review, are not supported by
adequate documentation; or
(c) where the costs incurred appear unreasonable and do not reflect the
actions a prudent person would take in the circumstances.
Questioned costs are to be recorded in the Department of the Treasury’s
(Treasury) Joint Audit Management Enterprise System (JAMES).9 The amount will
also be included in the Office of Inspector General (OIG) Semiannual Report to
Congress. It is Treasury management's responsibility to report to Congress on the
status of the agreed to recommendations with monetary benefits in accordance
with 5 USC Section 405(b) of the Inspector General Act of 1978.
Recommendation Questioned Costs
Recommendation No. 1
$30,705.68
Recommendation No. 2
$25,000.00
Recommendation No. 3
$31,095.52
The questioned cost represents amounts provided by Treasury under the
Coronavirus Relief Fund. As discussed in the attached desk review, $86,801.20 are
Ohio’s total expenditures reported in the grant-reporting portal that are deemed
ineligible and lacked supporting documentation.
8 2 CFR § 200.84 – Questioned Cost.
9 JAMES is Treasury’s audit recommendation tracking system.
Desk Review of the State of Ohio
1
1635 King Street
Alexandria, VA 22314
Phone: 703.229.4440
Fax: 703.859.7603
www.castroco.com
July 27, 2023
OIG-CA-23-037
MEMORANDUM FOR DEBORAH L. HARKER,
ASSISTANT INSPECTOR GENERAL FOR AUDIT
FROM:
Wayne Ference
Partner, Castro & Company, LLC
SUBJECT:
Desk Review of the State of Ohio
On June 13, 2022, we initiated a desk review of the State of Ohio’s (Ohio) use of
the Coronavirus Relief Fund (CRF) authorized under Title VI of the Social Security
Act, as amended by Title V, Division A of the Coronavirus Aid, Relief, and
Economic Security Act (CARES Act).1 The objective of our desk review was to
evaluate Ohio’s documentation supporting its uses of CRF proceeds as reported in
the GrantSolutions2 portal and to assess the risk of unallowable use of funds. The
scope of our desk review was limited to obligation and expenditure data for the
period of March 1, 2020 through March 31, 2022 as reported in Cycles 13 through
84 in the GrantSolutions portal.
As part of our desk review, we performed the following:
1. reviewed Ohio’s quarterly Financial Progress Reports (FPRs) submitted in
the GrantSolutions portal through March 31, 2022;
2. reviewed the Department of the Treasury’s (Treasury) Coronavirus Relief
Fund Guidance as published in the Federal Register on January 15, 2021;5
3. reviewed Treasury’s Office of Inspector General (OIG) Coronavirus Relief
Fund Frequently Asked Questions Related to Reporting and Recordkeeping;6
1 P.L. 116-136 (March 27, 2020).
2 GrantSolutions, a grant and program management Federal shared service provider under the
U.S. Department of Health and Human Services, developed a customized and user-friendly
reporting solution to capture the use of CRF payments from recipients.
3 Calendar quarter ending June 30, 2020.
4 Calendar quarter ending March 31, 2022.
5 Coronavirus Relief Fund Guidance as published in the Federal Register (January 15, 2021)
https://home.treasury.gov/system/files/136/CRF-Guidance-Federal-Register_2021-00827.pdf
6 Department of the Treasury Office of Inspector General Coronavirus Relief Fund Frequently Asked
Questions Related to Reporting and Recordkeeping OIG-20-028R; March 2, 2021.
Desk Review of the State of Ohio
2
4. reviewed Treasury OIG’s monitoring checklists7 of Ohio’s quarterly FPR
submissions for reporting deficiencies;
5. reviewed other audit reports issued, such as Single Audit reports, and those
issued by the Government Accountability Office and other applicable
Federal agency OIGs for internal control or other deficiencies that may pose
risk or impact Ohio’s uses of CRF proceeds;
6. reviewed Treasury OIG Office of Investigations (OI), the Council of the
Inspectors General on Integrity and Efficiency Pandemic Response
Accountability Committee (PRAC),8 and Treasury OIG Office of Counsel
input on issues that may pose risk or impact Ohio’s uses of CRF proceeds;
7. interviewed key personnel responsible for preparing and certifying Ohio’s
GrantSolutions portal quarterly FPR submissions, as well as officials
responsible for obligating and expending CRF proceeds;
8. made a non-statistical selection of Contracts, Grants, Transfers,9 Direct
Payments, Aggregate Reporting,10 and Aggregate Payments to Individuals11
data identified through GrantSolutions reporting; and
9. evaluated documentation and records used to support Ohio’s quarterly
FPRs.
Based on our review of Ohio’s documentation supporting the uses of CRF
proceeds as reported in the GrantSolutions portal, we determined that the
expenditures related to Grants greater than or equal to $50,000 and Transfers
greater than or equal to $50,000 did not comply with the CARES Act and
Treasury’s Guidance. We found that uses of CRF proceeds for Contracts greater
than or equal to $50,000, Direct Payments greater than or equal to $50,000,
7 The checklists are used by Treasury OIG personnel to monitor the progress of prime recipient
reporting in the GrantSolutions portal. GrantSolutions quarterly submission reviews are designed
to identify material omissions and significant errors, and where necessary, include procedures for
notifying prime recipients of misreported data for timely correction. Treasury OIG follows the CRF
Prime Recipient Quarterly GrantSolutions Submissions Monitoring and Review Procedures Guide,
OIG-CA-20-029R to monitor the prime recipients quarterly.
8 Section 15010 of P.L. 116-136 established the Pandemic Response Accountability Committee
within the Council of the Inspectors General on Integrity and Efficiency to promote transparency
and conduct and support oversight of covered funds (see Footnote 18 for a definition of covered
funds) and the coronavirus response to (1) prevent and detect fraud, waste, abuse, and
mismanagement; and (2) mitigate major risks that cut across program and agency boundaries.
9 A transfer to another government entity is a disbursement or payment to a government entity
that is legally distinct from the prime recipient.
10 Recipients are required to report CRF transactions greater than or equal to $50,000 in detail in
the GrantSolutions portal. Transactions less than $50,000 can be reported as an aggregate lump-
sum amount by type (contracts, grants, loans, direct payments, and transfers to other government
entities).
11 Obligations and expenditures for payments made to individuals, regardless of amount, are
required to be reported in the aggregate in the GrantSolutions portal to prevent inappropriate
disclosure of personally identifiable information.
Desk Review of the State of Ohio
3
Aggregate Reporting less than $50,000, and Aggregate Payments to Individuals
complied with the CARES Act and Treasury’s Guidance. Castro’s desk review
resulted in total questioned costs of $86,801.20. Additionally, we determined that
Ohio’s risk of unallowable use of funds is low. Castro is not recommending that
Treasury OIG personnel perform an audit of Ohio. However, Castro recommends
that Treasury OIG personnel pursue obtaining documentation from Ohio
management and follow-up on necessary reporting corrections for Grants greater
than or equal to $50,000 and Transfers greater than or equal to $50,000. In
addition, Castro recommends that Treasury OIG personnel pursue obtaining
information from Ohio management to determine whether there are ineligible
severance pay transactions in addition to those already identified as part of the
desk review procedures (see information in Summary of Testing Results below).
Non-Statistical Transaction Selection Methodology
Treasury issued a CRF payment to Ohio for $3,754,114,827.30. As of
March 31, 2022, Ohio’s cumulative obligations and expenditures were
$3,754,114,827.30 and $3,751,855,515.46, respectively. Ohio’s cumulative
obligations and expenditures by payment type through Cycle 812 are summarized
below.
Payment Type
Cumulative
Obligated Amount
Cumulative Expenditure
Amount
Contracts >= $50,000
$ 519,837,451.04 $ 519,410,778.84
Grants >= $50,000
$ 686,275,908.32 $ 685,836,206.88
Loans >= $50,000
$ - $ -
Transfers >= $50,000
$ 1,187,182,958.19 $ 1,187,182,958.19
Direct Payments >= $50,000
$ 490,863,156.72 $ 490,863,156.72
Aggregate Reporting < $50,000
$ 544,130,136.90 $ 542,737,198.70
Aggregate Payment to Individuals (in any
amount)
$ 325,825,216.13 $ 325,825,216.13
Totals
$ 3,754,114,827.30 $ 3,751,855,515.46
Castro made a non-statistical selection of Contracts greater than or equal to
$50,000, Grants greater than or equal to $50,000, Transfers greater than or equal
to $50,000, Direct Payments greater than or equal to $50,000, Aggregate Reporting
less than $50,000, and Aggregate Payments to Individuals. Selections were made
using auditor judgment based on information and risks identified in reviewing
audit reports, the GrantSolutions portal reporting anomalies13 identified by the
Treasury OIG CRF monitoring team, and review of Ohio’s FPR submissions. Castro
noted that Ohio management did not obligate or expend CRF proceeds to Loans
12 Calendar quarter ending March 31, 2022.
13 Treasury OIG has a pre-defined list of risk indicators that are triggered based on data submitted
by recipients in the FPR submissions that meet certain criteria. Castro reviewed these results
provided by Treasury OIG for Ohio.
Desk Review of the State of Ohio
4
greater than or equal to $50,000, therefore, we did not make a selection of
transactions from this category.
The number of transactions (28) we selected to test were based on Ohio’s total
CRF award amount and our overall risk assessment of Ohio. To allocate the
number of transactions (28) by obligation type (Contracts greater than or equal to
$50,000, Grants greater than or equal to $50,000, Transfers greater than or equal
to $50,000, Direct Payments greater than or equal to $50,000, Aggregate Reporting
less than $50,000, and Aggregate Payments to Individuals), we compared the
obligation type dollar amounts as a percentage of cumulative obligations for
Cycle 8.14 Additionally, Treasury OIG identified 11 potential duplicate payments
and 98 outliers.15 We included seven potential duplicate payments and 13 outliers
from the Contracts greater than or equal to $50,000, Grants greater than or equal
to $50,000, and Transfers greater than or equal to $50,000 payment types in
Castro’s selection. Total transactions tested were 48.
Background
The CARES Act appropriated $150 billion to establish the CRF. Under the CRF,
Treasury made payments for specified uses to States and certain local
governments; the District of Columbia and U.S. Territories, including the
Commonwealth of Puerto Rico, the United States Virgin Islands, Guam, American
Samoa, and the Commonwealth of the Northern Mariana Islands; and Tribal
governments. Treasury issued a CRF payment to Ohio for $3,754,114,827.30. The
CARES Act stipulates that a recipient may only use the funds to cover costs that—
(1) are necessary expenditures incurred due to the public health emergency
with respect to the coronavirus disease 2019 (COVID-19);
(2) were not accounted for in the budget most recently approved as of
March 27, 2020; and
(3) were incurred between March 1, 2020 and December 31, 2021.16
14 Calendar quarter ending March 31, 2022.
15 These outliers were flagged because the transactions were identified as having high dollar
amounts relative to transactions at similar points in time, with similar award descriptions, and that
were disbursed by the same prime recipient.
16 P.L. 116-260 (December 27, 2020). The period of performance end date of the CRF was extended
through December 31, 2021 by the Consolidated Appropriations Act, 2021. The period of
performance end date for tribal entities was further extended to December 31, 2022 by the State,
Local, Tribal, and Territorial Fiscal Recovery, Infrastructure, and Disaster Relief Flexibility Act,
Division LL of the Consolidated Appropriations Act, 2023, P.L. 117-328, December 29, 2022, 136
Stat. 4459.
Desk Review of the State of Ohio
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Section 15011 of the CARES Act requires each covered recipient17 to submit to
Treasury and the PRAC, no later than 10 days after the end of each calendar
quarter, a report that contains (1) the total amount of large covered funds18,19
received from Treasury; (2) the amount of large covered funds received that were
expended or obligated for each project or activity; (3) a detailed list of all projects
or activities for which large covered funds were expended or obligated; and (4)
detailed information on any level of sub-contracts or sub-grants awarded by the
covered recipient or its sub-recipients.
The CARES Act assigned Treasury OIG the responsibility for compliance
monitoring and oversight of the receipt, disbursement, and use of CRF proceeds.
Treasury OIG also has authority to recoup funds in the event that it is determined
a recipient failed to comply with requirements of subsection 601(d) of the Social
Security Act, as amended, (42 U.S.C. 801(d)).
Desk Review Results
Our review of Ohio’s quarterly FPR submissions through March 31, 2022 found
that Ohio complied with the reporting timeline as required under Treasury OIG
Guidance OIG CA-20-021, Coronavirus Relief Fund Reporting and Record
Retention Requirements.
Summary of Testing Results
Other than Grants greater than or equal to $50,000 and Transfers greater than or
equal to $50,000, transactions selected for detailed review were supported by
documentation and were allowable expenditures in accordance with the CARES
Act and Treasury’s guidance. We also found that the Contracts greater than or
equal to $50,000, Direct Payments greater than or equal to $50,000, Aggregate
Reporting less than $50,000 and Aggregate Payments to Individuals were
necessary expenditures due to the COVID-19 public health emergency, were not
accounted for in the budget most recently approved as of March 27, 2020, and
were incurred during the covered period. The transactions selected for testing
were not selected statistically, and therefore results cannot be extrapolated to the
total universe of transactions.
17 Section 15011 of P.L. 116-136 defines a covered recipient as any entity that receives large
covered funds and includes any State, the District of Columbia, and any territory or possession of
the United States.
18 Section 15010 of P.L. 116-136 defines covered funds as any funds, including loans, that are made
available in any form to any non-Federal entity, not including an individual, under Public Laws 116-
123, 127, and 136, as well as any other law which primarily makes appropriations for Coronavirus
response and related activities.
19 Section 15011 of P.L. 116-136 defines large covered funds as covered funds that amount to more
than $150,000.
Desk Review of the State of Ohio
6
The following table includes the total cumulative expenditure amount and the
expenditure amount tested. Additionally, this table includes a summary of
Castro’s testing results over expenditure transactions. Within the table below, we
have included a summary of unsupported and ineligible expenditures identified as
questioned costs. These expenditures do not comply with the CARES Act and
Treasury’s Guidance. Additionally, in the far-right column, we have identified the
expenditures that Castro tested without exceptions noted. See the Desk Review
Results section below this table for a detailed discussion of questioned costs and
other issues identified.
Summary of Expenditure Testing and Recommended Results – As of Cycle 820
Payment Type
Cumulative
Expenditure
Population Amount
Cumulative
Expenditure
Selection Amount
Unsupported
Exception
Ineligible
Exception
Castro Reviewed
Value
(per Support)
Contracts >=
$50,000
$ 519,410,778.84 $ 76,219,959.36
$ -
$ -
$ 76,219,959.36
Grants >=
$50,000
$ 685,836,206.88 $ 43,875,479.41
$ 25,000.00 $ 30,705.68
$ 43,819,773.73
Loans >=
$50,000
$ - $ -
$ - $ -
$ -
Transfers to
Other
Government
Agencies >=
$50,000
$ 1,187,182,958.19 $ 323,729,822.34
$ -
$ 31,095.52
$ 323,698,726.82
Direct Payments
>= $50,000
$ 490,863,156.72 $ 16,039,123.10
$ -
$ -
$ 16,039,123.10
Aggregate
Reporting <
$50,000
$ 542,737,198.70 $ 7,001,499.05
$ -
$ -
$ 7,001,499.05
Aggregate
Payments to
Individuals (in
any amount)
$ 325,825,216.13 $ 513,540.44
$ -
$ -
$ 513,540.44
Totals
$ 3,751,855,515.46 $ 467,379,423.70
$ 25,000.00 $ 61,801.20
$ 467,292,622.50
Grants Greater Than or Equal to $50,000
We determined Ohio’s Grants greater than or equal to $50,000 did not comply
with the CARES Act and Treasury’s Guidance. During our review of Grants greater
than or equal to $50,000, we determined that Ohio included ineligible and
unsupported expenditure amounts within its GrantSolutions submissions. We
question $55,705.68 for Grants greater than or equal to $50,000 of which
20 Calendar quarter ending March 31, 2022.
Desk Review of the State of Ohio
7
$30,705.68 is ineligible and $25,000.00 is unsupported. We selected seven original
transactions to test.
For one of the transactions, for reimbursement of utility expenses in arrears, Ohio
management was unable to provide adequate supporting documentation for us to
determine if the expenditures were eligible or allowable CRF expenses.
Specifically, Ohio management was unable to provide the underlying beneficiary
utility bills to support the dates claimed for these utility expense reimbursement
claims. We determined that the payment issued to the entity was not reasonable
based on the average monthly electricity bill and annual energy usage costs. After
further inspection, we identified the average recurring monthly utility bill and
annual energy usage costs were $459.00 and $5,508.00, respectively. The CRF
housing support financial assistance program issued a payment of $30,705.68 to
an entity whose electricity bill was outstanding before the enactment of the
CARES ACT. Additionally, based on Castro’s recalculations performed using the
supporting documentation obtained from Ohio management, the expenses in
arrears reflected an estimated outstanding balance of 5 years of usage, which is
outside of the covered period for CRF usage.
Based on the issues noted above, we determined that Ohio was not compliant
with the Federal Register 2021-0082721 Treasury CRF Program Guidance because
CRF was used for subsidy payments that were not incurred due to the COVID-19
public health emergency. As a result, we concluded that $30,705.68 in
expenditures are ineligible. Ohio management has not confirmed the root cause
of the error or the planned corrective action.
For one of the transactions, Ohio management was unable to provide sufficient
supporting documentation to determine if the expenditures were eligible or
allowable to justify use of CRF proceeds. Specifically, Ohio management was
unable to provide expenditure support in the form of invoices resulting in an
unsupported cost of $25,000.00 out of the total of $674,328.57 for the transaction.
Castro initially requested all of the invoices related to the total $674,328.57
amount. Castro received invoices to support $649,328.59 but did not receive the
last invoice for $25,000.00. Ohio management noted that the sub-recipient could
not find the invoice. As a result, Castro questions the $25,000.00 expenditure as an
unsupported cost.
Transfers Greater Than or Equal to $50,000
We determined Ohio’s Transfers greater than or equal to $50,000 did not comply
with the CARES Act and Treasury’s Guidance. During our review of Transfers
greater than or equal to $50,000, we determined that Ohio included ineligible
21 https://home.treasury.gov/system/files/136/CRF-Guidance-Federal-Register_2021-00827.pdf
Desk Review of the State of Ohio
8
expenditure amounts in its GrantSolutions submissions. We question $31,095.52
for Transfers greater than or equal to $50,000. We selected 14 original
transactions to test.
For one of the transactions, Ohio management could not provide adequate
supporting documentation to justify the expenditures were eligible or allowable.
Specifically, Ohio management reimbursed payroll costs related to separation pay
(or interchangeably known as “severance pay”) for a public health and safety
employee. Notwithstanding the fact that the employee was considered public
health and safety personnel, severance pay is an ineligible expenditure according
to the Federal Register 2021-00827 Treasury CRF Program Guidance Nonexclusive
Examples of Ineligible Expenditures No. 7 Severance Pay. The ineligible sub-
selection transaction amount totaled $31,095.52.
During our fieldwork procedures, we noted the reimbursement issued to the
employee significantly exceeded the amounts reimbursed for payroll to other
police department personnel. Due to the large amount of CRF proceeds provided
to the employee, we requested a breakdown of the hours and pay excluding the
80 hours regular pay for $2,630.40, which we deemed eligible. We obtained and
reviewed the following hours and amounts charged within the statements of
earnings and deductions paid on August 14, 2020, which sum to the total
retirement payoff of $31,095.52.
• 19.25 hours bonus time in the amount of $606.76;
• 382.09 hours sick time in the amount of $12,043.48;
• 566.99 hours vacation in the amount of $17,871.52; and
• 17.45 hours comp time in the amount of $573.76.
Based on the support, the hours were accrued outside the covered period of
performance related to the CRF program (before March 2020). We noted that the
hours accrued would not be attainable from a single bi-weekly pay period during
the normal course of operations.
We asked Ohio management to confirm whether the employee's retirement
payout costs were included in the CRF charges. Ohio management confirmed that
the payment was included in the CRF charges because the employee accrued
those hours during their employment with the county. In addition, Ohio
management told us that the employee received a payout consisting of the hours
earned (accrued paid time-off hours) due to their employment as a Sheriff ending
with the county. In conclusion, because the hours were accrued outside of the
allowable period of March 1, 2020 through December 31, 2021, the expenditures
for the retirement payout are not an eligible expense.
Desk Review of the State of Ohio
9
Ohio management told us that there are eligible expenditures not already charged
to CRF that could replace the separation payment. We recommend that Treasury
OIG personnel follow-up with Ohio management to recoup these funds or
determine if corrections are made for other allowable costs.
Conclusion
Based on our review of Ohio’s documentation supporting the uses of CRF
proceeds as reported in the GrantSolutions portal, we determined that the
expenditures related to Grants greater than or equal to $50,000 and Transfers
greater than or equal to $50,000 did not comply with the CARES Act and
Treasury’s Guidance. We question $61,801.20 for ineligible expenditures and
$25,000 of unsupported expenditures. We found that uses of CRF proceeds for
Contracts greater than or equal to $50,000, Direct Payments greater than or equal
to $50,000, Aggregate Reporting less than $50,000 and Aggregate Payments to
Individuals complied with the CARES Act and Treasury’s Guidance.
Our desk review resulted in total questioned costs of $86,801.20. We determined
that Ohio’s risk of unallowable use of funds is low. Castro is not recommending
that Treasury OIG personnel perform an audit of Ohio. However, Castro
recommends that Treasury OIG personnel pursue obtaining documentation from
Ohio management and follow-up on necessary reporting corrections for Grants
greater than or equal to $50,000 and Transfers greater than or equal to $50,000. In
addition, Castro recommends that Treasury OIG personnel pursue obtaining
information from Ohio management to determine whether there are ineligible
severance pay transactions in addition to those already identified as part of the
desk review.
Desk Review of the State of Ohio
10
*****
All work completed with this letter complies with the Council of the Inspectors
General on Integrity and Efficiency’s Quality Standards for Federal Offices of
Inspectors General, which require that the work adheres to the professional
standards of independence, due professional care, and quality assurance to
ensure the accuracy of the information presented.22 We appreciate the courtesies
and cooperation provided to our staff during the desk review.
Sincerely,
Wayne Ference
Partner, Castro & Company, LLC
22 https://www.ignet.gov/sites/default/files/files/Silver%20Book%20Revision%20-%208-20-12r.pdf