Washington’s $1.1 billion blunder: Audit uncovers massive mismanagement of federal COVID funds

In a stunning revelation, a recent audit from the Washington State Auditor’s Office (SAO) has uncovered that Washington state agencies “mishandled” more than $1.1 billion in federal COVID-19 aid, as reported by The Center Square. Despite the significant mismanagement, the state’s response seems surprisingly nonchalant, portraying an attitude of “No worries! It’s not like they’re going to ask for that money back.”

The SAO report found 86 issues across 11 state agencies in how federal COVID-19 aid was spent. The audit highlighted documentation deficiencies and questioned costs totaling $1.17 billion for the fiscal year 2023. Considering Washington spent over $29 billion in federal funds last year, this mishandled sum represents a significant 4.1% of the total.

Adam Wilson, SAO Assistant Director of Communications, noted that while the federal government has the legal authority to request repayment for funds if guidelines are not followed, it rarely exercises this power. Instead, federal agencies usually work with state counterparts to address concerns and ensure future compliance. This approach might explain the relaxed attitude from the SAO and other state leaders like the Governor and legislative leaders, but it raises a critical question: Shouldn’t there be more accountability for such a vast amount of mishandled taxpayer funds?

Several specific findings in the audit illustrate the scope and nature of the mismanagement:

• Office of the Superintendent of Public Instruction: Failed to track subcontractors who received $44.8 million. The responsible person retired without a replacement. This is not the first time this office and state superintendent Chris Reykdal have been reprimanded for less-than-stellar accounting and potential non-compliance with federal law.
• Department of Commerce: Could not ensure $4.1 million in Emergency Rental Assistance payments were properly managed due to staff turnover.
• Department of Transportation (WSDOT): Did not confirm subcontractors paid prevailing wages, with 62% of certified payrolls submitted late, some by over a month. WSDOT defended its performance, citing the challenge of managing its largest and most complex construction program with reduced and less experienced staff.

While the SAO assures us that federal clawbacks are rare, this shouldn’t excuse the mishandling of $1.1 billion. Taxpayers deserve better oversight and accountability. The ease with which these funds were mismanaged and the casual response from the SAO are deeply concerning. It reflects a broader issue of governance and fiscal responsibility that demands urgent attention from the Governor and legislative leaders.

Earlier this month, the State Auditor released a report detailing how a Washington State Office of Administrative Hearings spent nearly $900,000 via fraudulent credit card purchases over the course of four years.

And in May, the King County Auditor found the King County Recorder’s Office – which is responses for tax collection – also “mishandled” $7 million over six years.

These sorts of scandals have sadly become an embarrassing trend in Washington. What’s even sadder is with each one that pops up, they become more and more expected. Our state’s lawmakers, auditors, and public employees need to step up in order to restore greater trust in our institutions.