Desk Review of the City of San Jose's Use of Coronavirus Relief Fund Proceeds
Summary
In this October 5, 2026 memorandum (OIG-27-010), Pauletta P. Battle, Assistant Inspector General for Audit at the Treasury Office of Inspector General, reports on a desk review of the City of San Jose's use of Coronavirus Relief Fund proceeds, begun on April 8, 2022 after a complaint referral to the Pandemic Response Accountability Committee Hotline. Treasury paid San Jose $178,295,348 in CRF payments, all of it spent as of March 31, 2022. The office tested 27 transactions, including eleven contract transactions totaling $28,342,898 for items such as Emergency Interim Housing and emergency shelters, without exception. It found San Jose's documentation complied with the CARES Act and Treasury's Guidance, rated the risk of unallowable use as low and will not audit the city, which concurred in an August 20, 2026 response.
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DEPARTMENT OF THE TREASURY
WASHINGTON, D . C . 20220
OFFICE OF
INSPECTOR GENERAL
October 5, 2026
OIG-27-010
MEMORANDUM FOR JEFFREY W. S TOUT, ACTING CHIEF PROGRAM
OFFICER, OFFICE OF CAPITAL ACCESS, DEPARTMENT
OF THE TREASURY
FROM: Pauletta P. Battle Isl
Assi stant Inspector General for Audit
SUBJECT: Desk Review of the City of San Jose's Use of
Coronavirus Relief Fund Proceeds
On April 8, 2022, we initiated a desk review of the City of San Jose's (San Jose)
use of the Coronavirus Relief Fund (CRF) proceeds, authorized under Titl e VI of the
Social Security Act, as amended by Title V, Divisi on A of the Coronavirus Aid,
Reli ef, and Economi c Security Act ( CARES Act). ' This revi ew was initi ated in
response to a compl a i nt referral submitted to the Council of the Inspectors General
on Integrity and Effici ency (CIGIE) Pandemic Response Accountability Committee
(PRAC) Hotline. 2 The objective of our desk review was to evaluate San Jose's
documentati on supporting i ts uses of CRF proceeds as reported in the
GrantSoluti ons3 portal and to assess the risk of unallowable use of funds. The
scope of our desk review covered San Jose's obligation and expenditure data for
the peri od March 1, 2020, through March 31, 2022 (cycles 1-8), as reported in
GrantSoluti ons.
As part of the desk review, we performed the followi ng:
1) reviewed San Jose's quarterly Financial Progress Reports (FPRs) submi tted in
GrantSolutions through March 31, 2022;
1
P.L. 116-136 (March 27, 2020)
2
Section 1 5010 of P. L. 116-136 established the PRAC withi n the CIGIE to promote transparency
and conduct and support o v ersi ght of covered funds and the coronav i rus response to (1) prevent
and detect fraud, waste, abuse, and m i smanagement; and (2) m it i gate maj or risks that cut across
program and agency boundari es.
3
GrantSolutions, a grant and program management Federal shared service provider under the U.S.
Department of Health and Human Services, dev e l oped a customi zed and user-fri endl y reporti ng
sol uti on to capture the use of CRF payments from r eci p i ents.
1
2) reviewed the Department of the Treasury’s (Treasury) Coronavirus Relief
Fund Guidance (Guidance) as published in the Federal Register on
January 15, 2021;4
3) reviewed Treasury’s Office of Inspector General’s (OIG) Coronavirus Relief
Fund Frequently Asked Questions Related to Reporting and Recordkeeping; 5
4) reviewed Treasury OIG’s Coronavirus Relief Fund Reporting and Record
Retention Requirements;
5) reviewed Treasury OIG’s monitoring checklists 6 of San Jose’s quarterly FPR
submissions for reporting deficiencies;
6) reviewed other audit reports issued, such as Single Audit Act reports, and
those issued by the Government Accountability Office and other applicable
Federal agency OIGs for internal control or other deficiencies that may pose a
risk or impact to San Jose’s use of CRF proceeds;
7) reviewed Treasury OIG Office of Investigations, the CIGIE PRAC, and
Treasury OIG Office of Counsel input on issues that may pose risk or impact
to San Jose’s use of CRF proceeds;
8) interviewed key personnel responsible for preparing and certifying San Jose’s
quarterly FPR submissions, as well as officials responsible for obligating and
expending CRF proceeds;
9) made a non-statistical selection of Contracts greater than or equal to
$50,000, Grants greater than or equal to $50,000, Aggregate Reporting less
than $50,000, 7 and Aggregate Payments to Individuals 8 data identified
through GrantSolutions reporting; and
10) evaluated documentation and records used to support San Jose’s quarterly
FPRs.
4
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
5
Treasury OIG, Coronavirus Relief Fund Frequently Asked Questions Related to Reporting and
Recordkeeping OIG-20-028R (March 2, 2021)
6
The checklists were used by Treasury OIG personnel to monitor the progress of prime recipient
reporting in the GrantSolutions portal. GrantSolutions quarterly submission reviews were
designed to identify material omissions and significant errors, and where necessary, included
procedures for notifying prime recipients of misreported data for timely correction. Treasury OIG
followed the CRF Prime Recipient Quarterly GrantSolutions Submissions Monitoring and Review
Procedures Guide, OIG-CA-20-029R to monitor the prime recipients on a quarterly basis.
7
Prime recipients were 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).
8
Obligations and expenditures for payments made to individuals, regardless of amount, were
required to be reported in the aggregate in the GrantSolutions portal to prevent inappropriate
disclosure of personally identifiable information.
2
Based on the results of our desk review, San Jose’s documentation supporting the
uses of CRF proceeds complied with the CARES Act and Treasury’s Guidance.
Additionally, we determined that San Jose’s risk of unallowable use of funds is
low. Accordingly, we will not be conducting an audit of San Jose.
Non-Statistical Transaction Selection Methodology
Treasury issued a total of $178,295,348 in CRF payments to San Jose. As of
March 31, 2022, San Jose expended all of its CRF funds. We made a non-
statistical selection of 27 transactions from Contracts greater than or equal to
$50,000, Grants greater than or equal to $50,000, Aggregate Reporting less than
$50,000, and Aggregate Payments to Individuals. We made selections using
auditor judgment based on the total CRF award amount, amounts claimed within
each payment type, and our overall risk assessment of San Jose. Because the
transactions tested were non-statistically selected, results could not be
extrapolated to the total universe of transactions.
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 U.S. Virgin Islands, Guam, American Samoa,
and the Commonwealth of the Northern Mariana Islands; and Tribal governments
(collectively referred to as “prime recipients”). Treasury issued a total of
$178,295,348 CRF payments to San Jose. The CARES Act stated that a prime
recipient may only use the funds to cover costs that were—
1. necessary expenditures incurred due to the public health emergency with
respect to the Coronavirus Disease 2019 (COVID-19);
2. not accounted for in the budget most recently approved as of March 27,
2020; and
3. incurred during the period between March 1, 2020, and ended on
December 31, 2021, for states, local governments, and territories. In the
case of tribal governments, were incurred during the period that began on
March 1, 2020, and ended on December 31, 2022 (covered period).
3
Section 15011 of the CARES Act, required each covered recipient 9 to submit
Treasury and the PRAC, no later than 10 days after the end of each calendar
quarter, a report that contained (1) the total amount of large covered funds 10,11
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.
Desk Review Results
We reviewed the GrantSolutions portal and found that San Jose timely filed
quarterly FPRs for the period March 1, 2020, through March 31, 2022
(cycles 1-8), as required under Treasury OIG’s Guidance, Coronavirus Relief Fund
Reporting and Record Retention Requirements.
We found that the transactions tested in Contracts greater than or equal to
$50,000, Grants greater than or equal to $50,000, Aggregate Reporting less than
$50,000, and Aggregate Payments to Individuals payment types were: (1)
necessary expenditures incurred due to the public health emergency with respect to
COVID-19, (2) not accounted for in the budget most recently approved as of
March 27, 2020, and (3) incurred during the covered period. Table 1 shows a
summary of expenditure totals and the results of our testing.
9
Section 15011 of P.L. 116-136 defined a covered recipient as any entity that received large
covered funds and included any State, the District of Columbia, and any territory or possession
of the United States.
10
Section 15010 of P.L. 116-136 defined covered funds as any funds, including loans, that were
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 made appropriations for
Coronavirus response and related activities.
11
Section 15011 of P.L. 116-136 defined large, covered funds as covered funds that amounted to
more than $150,000.
4
Table 1 Summarv [I1,W3±}RSA1 Testina l:41ta
Cumul ative Cumulative
Expenditure Expenditure Number of Unsupported Ineli gible Total
Payment Population Tested Transactions Questioned Questioned Questioned
Tvne Amount Amount ht:4377;1 6.t323 6.t3ti r.t3ti
Contracts
>= $
$ 50,000 $ 61,725,664 28,342,898 11 $ $ $
Grants > = $
$ 50,000 $ 2 1,187,758 15,050,124 5 $ $ $
Aggregate
Reporting
< $50,000 $ 4,017,228 $ 779 2 $ $ $
Aggregate
Payments
to
I ndi v i dual s
(in any
amount) $ 91,364,698 $ 9 $ $ $
Totals $178.295.348
Source: Treasury OIG
27 S $
$
Iii
Contracts Greater Than or Equal to $50,000
We tested eleven transacti ons totaling $28,342,898 without exception.
Transactions tested included expenditures to design, build, and deliver Emergency
Interim Housing for the homeless individuals who were affected by COVID-19;
operate temporary emergency shelters for unhoused individuals who were at risk of
contracting COVID-19; cover costs for shel tering and supporting eligible residents
needing isolation or quarantine and could not safely isolate or quarantine in their
own re s i denti al uni t s ; and prepare and distribute groceries to the resi d e nts
experiencing food insecurity and other impacts due to the COVID-19.
Grants Greater Than or Equal to $50,000
We tested five transactions totaling $15,050,124 without exception. Transactions
tested included expenditures for assistance to local small businesses; nonprofit
organi zati ons; l i censed family childcare providers; and to provide meals and
groceries to eligi b l e resi dents affected by the COVID-19 pandemic.
5
Aggregate Reporting Less Than $50,000
We tested two transactions totaling $779 without exception. Transactions tested
included expenditures for the heating and plumbing services provided at the
shelters for the unhoused population; and for the purchase of faucet covers as a
part of the materials needed to convert existing faucets at citywide facilities to
touchless faucets in response to the COVID-19 pandemic.
Aggregate Payments to Individuals
We tested nine transactions totaling $14,219 without exception. Transactions
tested included payroll costs. Payroll costs were for public health and safety
personnel and substantially dedicated personnel dedicated over 50 percent of their
time to mitigating or responding to the COVID-19 public health emergency.
Conclusion
We determined that San Jose’s expenditures, as tested, were necessary 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 that began March 1, 2020, and ended on December 31, 2021.
Based on our review, we determined that San Jose’s risk of unallowable use of
funds is low. As a result, we will not be conducting an audit.
City of San Jose Response
The City of San Jose concurred with our assessment. On August 20, 2026, the
City of San Jose provided its written response which is included in its entirety as
Appendix 1.
*****
All work completed 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.12
12
https://www.ignet.gov/sites/default/files/files/Silver%20Book%20Revision%20-%208-20-12r.pdf
6
We appreciate the courtesies and cooperation provided to our staff during the desk
review. If you have any questions or require further information, please contact me
at (202) 927-5400, or a member of your staff may contact Julie Wong, Acting
Deputy Assistant Inspector General for Audit, at (202) 439-6354.
cc: Michelle A. Dickerman, Deputy Assistant General Counsel, Department of
the Treasury
Thao P. Tran, Acting Chief Operating Officer, Office of Capital Access,
Department of the Treasury
Maria Oberg, Director of Finance, City of San Jose
Victor Lo, Deputy Director of Finance, City of San Jose
7
(b) (6)
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