Auditor: Iowa’s GOP governor misallocated at least $21 million in COVID-19 funds

Iowa State Auditor Rob Sand and the U.S. Treasury Department’s inspector general have advised Gov. Kim Reynolds’ (R-IA) administration to reallocate federal money or repay it after it was found that $21 million in COVID-19 funds were not used properly.

Iowa used the money from the federal Coronavirus Aid, Relief, and Economic Security, or CARES, Act to help pay for a new accounting system. The software was not approved under the CAREA Act. CARES Act money is intended for necessary expenditures incurred as a result of COVID-19. Iowa justified the allocation by saying the software would help to quickly assist essential employees during the pandemic. But Sand noted that the state had contracted for the work in 2019, which was before the pandemic, and concluded that it does not qualify.

“These expenditures are not ‘due to the public health emergency,’" Sand’s wrote in a letter last week to Iowa Department of Management Director Dave Roederer.

Sand also questioned the earmarking of $448,449 in federal funds to pay the salaries of 21 of Reynolds' staffers between March 14 and June 30. If these expenses were unrelated to the COVID-19 pandemic, they may need to be repaid.