OIG-CA-26-033: Determination on Corrective Actions for Desk Review of State of Texas' Use of Coronavirus Relief Fund

Summary

Letter of May 13, 2026 (OIG-CA-26-033) from Pauletta Battle, Assistant Inspector General for Audit at the Treasury Office of Inspector General, to Warren Collier, Director of Financial Services in the Office of the Governor of Texas, giving the final determination on corrective actions for the desk review of the State of Texas’ use of Coronavirus Relief Fund proceeds (OIG-CA-23-034). The independent public accounting firm questioned $17,288,575: $12,876,985 of unsupported costs for a distant learning grant program, $3,924,220 of unsupported costs from a variance between Texas’ general ledger and the expenditures recorded in GrantSolutions, and $487,370 of ineligible audit services costs. In July 2025 and March 2026 Texas provided adequate documentation for $15,546,454 and returned the remaining $1,742,121 to the Treasury, so its corrective actions addressed the questioned costs.

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                                         DEPARTMENT OF THE TREASURY
                                                W ASHINGTON, D.C. 20220




     OFFICE OF
INSPECTOR GENERAL
                                                   May 13, 2026

           OIG-CA-26-033

           Mr. Warren Collier
           Director of Financial Services
           Office of the Governor
           1100 San Jacinto
           Austin, TX 78701

           Re: Final Determination on Corrective Actions for Desk Review of State of Texas’
           Use of Coronavirus Relief Fund Proceeds (OIG-CA-23-034)

           Dear Mr. Collier:

           The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), 1 established
           the Coronavirus Relief Fund (CRF) and appropriated $150 billion for making
           payments to states, District of Columbia, local, territorial, and tribal government
           entities. CRF recipients may use the CRF award funds to cover costs that:

                1. were 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 government’s budget most recently approved
                   as of March 27, 2020; and
                3. were incurred during the period that began on 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).

           Under a contract monitored by our office, a certified independent public accounting
           firm (IPA) performed a desk review to evaluate Texas’ documentation supporting its
           use of CRF proceeds as reported in the GrantSolutions 2 portal. In the desk review
           memorandum,3 the IPA identified total unsupported and ineligible questioned costs
           of $17,288,575. Specifically,

                •   In the “grants greater than or equal to $50,000” category, the IPA identified
                    unsupported questioned cots of $12,876,985 related to a distant learning
                    grant program.
           1
               P.L. 116-136 (March 27, 2020)
           2
               GrantSolutions, a grant and program management Federal shared service provider under the
               United States Department of Health and Human Services, developed a customized and user-
               friendly reporting solution to capture the use of CRF payments from prime recipients.
           3
               Treasury OIG, Desk Review of State of Texas’ Use of Coronavirus Relief Fund
               Proceeds, OIG-CA-23-034 (July 21, 2023)
Page 2

      •   In the “aggregate reporting less than $50,000” category, the IPA identified
          unsupported questioned costs of $3,924,220 related to a variance between
          Texas’ general ledger and the expenditures recorded in GrantSolutions.
      •   In the “contracts greater than or equal to $50,000” category, the IPA
          identified ineligible questioned costs of $487,370 related to audit services.

In April 2025, we contacted Texas requesting the state to provide supporting
documentation for the questioned costs. In July 2025 and March 2026, Texas
provided adequate documentation for $15,546,454 and returned the remaining
$1,742,121 questioned costs to the Department of the Treasury. As such, Texas’
corrective actions addressed the questioned costs identified in the desk review.

We appreciate the courtesies and cooperation provided to our staff during the desk
review follow-up. If you have any questions or require further information, please
contact me at (202) 927-5400, or a member of your staff may contact Olivia
Scott, Acting Audit Director, at (202) 277-1196.

Sincerely,

/s/

Pauletta Battle
Assistant Inspector General for Audit


cc:       Michelle A. Dickerman, Deputy Assistant General Counsel, Department of
             the Treasury
          Danielle Christensen, Deputy Chief Program Officer for State and Local
             Programs, Office of Capital Access, Department of the Treasury
          Jeffery W. Stout, Acting Chief Program Officer, Office of Capital Access,
             Department of the Treasury
          Thao P. Tran, Acting Chief Operating Officer, Department of the Treasury


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