Auditors discover issues with two state agencies

Louisiana auditors found problems with two state agencies: the Department of Agriculture and the Louisiana Ethics Board.

The Louisiana Office of the Legislative Auditor looked at the Louisiana Department of Agriculture and Forestry (LDAF) to assess certain controls that the LDAF uses to ensure the accuracy of financial reports, compliance with laws and applicable regulations and accountability of public funds. The period concerned was from July 1, 2019 to June 30, 2021.

The auditors found that the LDAF made Forest Productivity Program payments totaling $ 3,686,026 to landowners during the period July 1, 2019 to July 31, 2020, of which $ 553,041 (15%) violated the provisions of Revised Law 3: 4412 (C) that were in force. at the time.

This section of the law reads as follows: The commissioner determines the extent of the state’s participation in each cooperation agreement, which must not exceed fifty percent of the cost of the cooperation agreement or a total value of assistance of ten thousand dollars to a landowner in the during a fiscal year.

The auditors withdrew 21 payments under the program and found:

• Seven payments totaling $ 91,441, of which $ 30,480 exceeded $ 10,000 and were based on a 75% state cost-share rate, which violated the revised law which stipulates a maximum allowable amount of $ 10,000 and a cost-sharing rate of 50%.
• In addition, our procedures revealed that for each of these payments, the ADF divided the payment amounts in the expenditure data to reflect the fact that no landowner was paid more than $ 10,000 during the course of the period. an exercise.
• Based on discussions with LDAF staff, it was LDAF practice in FY2020 to split payments using two claim numbers to avoid the limit of $ 10,000 per landowner in the FPP system.
• Fourteen payments totaling $ 58,825, less than $ 10,000, were reimbursed by LDAF at a 75% cost share, which violated the 50% cost share rate allowed by RS 3: 4412 (C), resulting in overpayments of $ 19,605.

After discovering these issues, the auditors then “compiled a report of all payments made to landowners during the period July 1, 2019 to July 31, 2020. We identified additional payments to landowners, greater than 10,000. $, totaling $ 502,956, in violation of the provisions of the revised law. If landowners had not received more than the maximum allowed of $ 10,000 per fiscal year, and if payments were based on a maximum cost-sharing rate of 50%, more potentially eligible landowners would have were able to receive help before funds ran out, â€the report says.

The report says LDAF interprets this law in a way that allows the practices they used – but ignores part of the law.

“LDAF interprets pre-Aug 1, 2020 language of RS 3: 4412 (C) as providing that” more than one cooperative arrangement is allowed per landowner, but no more than the Ministry of Agriculture procedural report and Louisiana Forests 3, the ceiling is authorized in payment †[for each agreement]. This interpretation omits the entire second clause of the law (ie the expression “a total value of assistance of ten thousand dollars to a landowner in a fiscal year.”) Any interpretation which empties the words of the law is contrary to the rules of statutory interpretation and, therefore, is legally erroneous â€, states the report. “In addition, in interviews conducted during engagement, LDAF staff acknowledged that claims were reimbursed on a first come, first served basis and that once the amount allocated to the FPP was exhausted during the Fiscal year 2020, the ministry rejected subsequent claims received and reimbursed these applicants. “

In his response, the department’s deputy commissioner, Dane Morgan, challenged the auditors’ interpretations. He said the ministry’s legal staff had reviewed the practices.

“LDAF did not ‘split payments … to avoid the limit of $ 10,000 per landowner.’ acres permitted by law, â€Morgan wrote. “During the implementation of these procedures, the ministry recognized that the law could be
misinterpreted. Therefore, the department had the language clarified during the 2020 legislative session. â€

The auditor’s office also assessed internal controls and transactions relating to self-generated revenues, statutory commitments, government acquisition card expenses, Fueltrac card expenses, rental expenses, salary expenses. , expenses related to information technology and access by LaGov users. With the exception of the issue of forest payments, the auditors found that these controls provided reasonable assurance of accountability for public funds and compliance with applicable laws and regulations for the period under review.

Here is their summary report. You can read the entire audit by scrolling down.

In their review of the Louisiana State Department’s civil service, the auditors found that, for the third consecutive report, the Louisiana Board of Ethics (BOE), which falls under the jurisdiction of the department, was not submitting overdue debts to the Attorney General in a timely manner. manner. As of March 18, 2021, the BOE website noted 2,129 unpaid late fees totaling $ 2.7 million from campaign finance disclosure reports, lobbying expense reports, and personal financial disclosure statements.

State auditors tested 30 late fees collected between July 1, 2019 and March 18, 2021, and of those 25 “had delays in processing that resulted in the debt not being sent to the AG or was sent late. In addition, one had mail delivery issues that prevented the debt from being established as past due and from being sent for collection. “

The auditors also assessed controls and transactions related to the BOE’s handling of late fees, spending on acquisition cards, revenue collection from state agencies, as well as payroll and staff. With the exception of issues related to late fees, the auditors found that these controls provided reasonable assurance of accountability for public funds and compliance with applicable laws and regulations for the period under review.

In the agency’s response, ethics administrator Kathleen Allen said some delays were necessary due to the demands of the process, and noted that the postal service was interrupted in 2020 due to the pandemic.

“While the Agency agrees that every effort should be made to minimize delays in transmitting debts to the Attorney General’s office, it affirms that it is complying with the statutory provisions of RS 47: 1676. After providing the required notices and waited 60 days as required by law, the agency is required to authenticate the debt before sending it to the AG’s office in accordance with RS47: 1676C (2) (a), “Allen wrote. “Determining the finality of a judgment is a manual process which, under normal circumstances, can take a long time to ensure that all required statutory notices have been received, that all deadlines have expired and that all notices in accordance with to RS 47: 1676 have been provided.

“Most of the sample set that was tested for procedural review had due dates in 2020,†Allen continues. “Due to changes in USPS procedures in response to COVID-19, the process for determining the finality of judgments has taken longer. Verifying the receipt of notices and the purpose of reports has taken longer. Further, at the onset of the COVID-19 shutdown when employees began working remotely, the GA Office asked the Ethics Administration Program to suspend sending overdue accounts. Steps were taken to temporarily assign staff to assist with assessment and collection tasks, as well as processing poster returns. “

Here is the summary report. You can read the entire audit by scrolling down.

Here are the full reports: