Audit of federal dollars in Washington state reviews pandemic-related spike in spending

FOR IMMEDIATE RELEASE

Aug. 8, 2022

OLYMPIA – The Office of the Washington State Auditor's annual audit of federal money spent in the state revealed 61 areas of concern across 21 federal programs. Because of a lack of documentation, auditors were unable to audit one entire program, calling into question at least $271 million in spending.

These issues and more can be found today in an accessible summary of the extensive audit report by the State Auditor's Office (SAO).

“While state programs shouldered an enormous burden in the midst of the pandemic, the public expects them to account for how they spent federal tax dollars,” said State Auditor Pat McCarthy. “Our extensive review offers state agencies insights into where they missed the mark, and recommendations for how to fix it.”

Each year SAO's Single Audit examines whether state agencies followed appropriate guidelines and properly accounted for federal funding. The most recent Single Audit, covering fiscal year 2021, was the first to review an entire year of COVID-19-related emergency funding. The full report, at 1,083 pages, can be found here. A summary infographic can be found here.

Noteworthy items from the audit:

• The state's federal spending surged in 2021. As Washington weathered the economic effects of the COVID-19 pandemic, state agencies spent almost $37 billion in federal funds — a 42 percent increase compared to 2020.
• Auditors noted 61 significant problems – findings – in 21 federal programs. Most of the findings were not COVID-19 funding related. Of the 11 that were, issues in monitoring relief funding awarded to outside organizations were the most common.
• Beyond COVID-19 funding, 31 findings remain unresolved from previous audits, including some issues auditors have reported annually for more than a decade.
• Notably, for the first time since 2003, SAO determined an entire state program could not be audited because of insufficient records. This resulted in auditors questioning at least $271 million in childcare provider payments, which could lead to the federal government asking for partial or full repayment. The details can be found here.

In addition to audit work, SAO offers classes on federal award requirements to state agencies and local governments multiple times a year to help improve compliance with federal requirements.

Media inquiries: Kathleen Cooper, Director of Communications – Kathleen.Cooper@sao.wa.gov | 360-890-0751