Watchdogs express concern to lawmakers about ability to oversee coronavirus relief funds

Federal watchdogs expressed concern to lawmakers regarding a ruling by the Trump administration that they said limits their ability to oversee the distribution of $1 trillion in coronavirus relief funds. 

Inspectors general responsible for the Pandemic Response Accountability Committee (PRAC), wrote a letter to lawmakers last week regarding their concerns about an “ambiguity” in the CARES Act. The letter was released Monday by House Oversight and Reform Chairwoman Carolyn Maloney (D-N.Y.). 

The inspectors general said the Treasury Department’s general counsel issued a legal opinion that concluded that recipient reporting obligations detailed in the CARES Act, which created PRAC, do not extend to Division A of the act — which the inspectors general warn would “present potentially significant transparency and oversight issues.” 

Division A of the CARES Act includes over $1 trillion in funding for programs, including the $670 billion Paycheck Protection Program that grants loans to small businesses. 

“Notwithstanding the opinion, Treasury and [the Office of Management and Budget] leadership have expressed to the PRAC their commitment to ensuring transparency, accountability, and adherence to all statutory requirements in connection with the CARES Act and signaled strong support of Treasury OIG’s ability to request necessary recipient information to perform its critical Title V responsibilities,” the inspectors general wrote. “Nevertheless, we raise this possible ambiguity in the CARES Act to your attention for any legislative action you deem appropriate.”

The letter was signed by Michael Horowitz, acting chair of PRAC and inspector general of the Department of Justice, and Robert Westbrooks, the executive director of PRAC. 

Maloney called the Trump administration’s interpretation of the law “flawed,” and accused the administration of contradicting themselves by “arguing that loopholes in the law exempt agencies from producing certain information” while also expressing a commitment to transparency and accountability. 

“They seem to be saying one thing while doing exactly the opposite,” Maloney said in a statement. “If the Trump Administration is committed to full cooperation and transparency with taxpayer dollars, it is unclear why it is manufacturing legal loopholes to avoid responding to legitimate oversight requests.”

She called on the administration to propose and support any potential changes to the legislation if officials feel the law needs to be clarified. 

“This money belongs to the American people—not the President—and the Administration has an obligation to explain where these funds are going,” Maloney added. 

Chairman of the Senate Appropriations Committee Richard Shelby (R-Ala.) indicated he’ll support a legislative fix to the transparency requirement, according to Politico. 

“American taxpayers have a right to know how their money is being spent,” Blair Taylor, a spokeswoman for Shelby, told Politico. “Neither the letter nor the spirit of the law limit the accountability committee’s purview in that regard.”

A spokesperson for the Treasury Department, Monica Crowley, told Politico the administration was already submitting to “comprehensive oversight” by inspectors general, the COVID-19 Congressional Oversight Commission, and the Government Accountability Office. 

“The Pandemic Response Accountability Committee’s scope under the CARES Act covers other programs that are not already reviewed by these overlapping bodies,” Crowley said. “Further duplication of these oversight functions by PRAC would not increase transparency or oversight.”

The Hill reached out to the Treasury Department for comment.