State Watch

Audit finds Iowa governor spent COVID-19 funds on salaries

Iowa Gov. Kim Reynolds (R) was accused in an audit report of using nearly $450,000 in federal funding intended for COVID-19 relief to fund three months of salaries for more than 20 staff members.

A state audit on government spending published Monday said Reynolds attempted to cover up the spending by passing it through the state Department of Homeland Security and Emergency Management, but it is unclear why the salaries had to be paid using the federal money, according to The Associated Press

“What is not clear, is why these salaries were not included in the governor’s budget set prior to the fiscal year and prior to the pandemic,” State Auditor Rob Sand (D) said, per the AP. “Based on this information, we conclude that the budget shortfall was not a result of the pandemic.”

Sand added that he asked twice for documents to provide reasoning for the spending but was told that the governor’s office was completely focused on their COVID-19 response and did not provide proof. In October, Sand told Reynolds that paying staff salaries without the necessary documentation was unlikely to be approved federally, the wire service noted. 

A spreadsheet Sand requested from the Department of Homeland Security and Emergency Management included a section labeled “FY 2020 Shortfall” and an amount of $448,448.86. A later version of the document labeled the section “COVID-19 Personnel Costs” but listed the same amount of money, according to the AP.

“That spreadsheet that shows they changed the headers to basically instead of say shortfall to say COVID 19 is a pretty big deal,” Sand said to the AP.

Alex Murphy, a spokesperson for Reynolds, told The Hill that the “use of Coronavirus Relief Funds to reimburse the salaries and benefits of a governor’s staff is an allowable expense.” 

“During this time, the Governor’s staff spent a vast majority of their time responding to the pandemic. In fact, many members of Gov. Reynolds’ staff worked seven days a week out of the State Emergency Operation Center to provide direct support to Iowans. This has always been our justification for the expense,” Murphy said. “We are now working with Treasury to provide them documentation, per their request.”

Reynolds has also said that “CARES funding can be used for salaries. That’s very clear in what allowable allocations are,” the AP added.

Late last year, Reynolds had to give back $21 million in COVID-19 relief money after she used it to update a dated information technology system. The governor initially said that project was an allowable expense but later decided it was not permissible as part of the federal Coronavirus Aid, Relief, and Economic Security Act, the wire service noted.

— Updated Nov. 16 at 12:21 p.m.


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