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State Audit Shows Social Services Shortfall

March 08, 2001
By: Ben Paynter
State Capital Bureau

JEFFERSON CITY - Missouri State Auditor Claire McCaskill said Thursday that the Department of Social Service allowed ineligible welfare recipients benefits and left more than $11.8 million unaccounted for in some federal programs administered by the state.

"This is a real problem," McCaskill said. "If they want to spend other money they shouldn't, it's pretty easy to do."

McCaskill said 62 percent of federal grant money received by the state goes through Social Services.

Auditors found 235 people drew both welfare and workers' compensation relief last year. In a six person sample drawn from the dual recipients, four of the dual recipients received food stamps, Medicare or Temporary Assistance for Needy Families for which they were ineligible.

Marilynn Knipp, a department spokesperson, said the size of the welfare population made extensive regulation of the program "cost prohibitive."

"You can spend a great amount of effort to go after a small return," Knipp said.

About 52,823 Missouri families received TANF (formerly known as Aid to Families with Dependent Children) in 1999, according to the proposed 2001 state budget.

McCaskill also said Social Services did not accurately account for $11.8 million used in the "Caring Communities" and "Juvenile Justice" programs, failing to audit the funding recipients as required by federal regulations.

Chris Rackers, director of budget and finance at Social Services, said she "respectfully disagreed" with the audit.

"There is no mismanagement, no fraud," Rackers said. "This is just a disagreement in how we keep our books."

She said auditors misinterpreted program rhetoric, denoting some government entities as "sub recipients," while the department called the entities "vendors," which require less stringent bookkeeping.

State law requires departments to submit a corrective action plan to federal grantors within 30 days of an audit.

"We will give an analysis of the criteria looked at and will talk to our federal partner to resolve it with the agency," Rackers said.

McCaskill said it was unclear what impact the audit would have on future federal funding.

"We expect fiscal accountability from state agencies," McCaskill said. "Generally they do not repay the money, but it is always a possibility" that the federal government would demand reimbursement.

The audit of state-administered federal grant showed shortcomings in the internal accounting system at the Department of Economic Development and funds management at the Department of Natural Resources.

Auditors reported that DNR lost about $51,000 in interest because it waited a month to deposit loan guarantees totalling at least $11 million.