Audit Finds Stimulus Lapse

A preliminary audit appears to have found that Tennessee is “materially out of compliance” with regulations for federal stimulus funds that were supposed to be spent on weatherization improvements for low-income homeowners.

“Failure to comply with program requirements may cause the state to lose substantial federal funding for which our citizens pay taxes,” state Comptroller Justin Wilson said in a letter to the Department of Human Services, which oversees the weatherization program.

Wilson outlined a series of problems his auditors found reviewing projects funded with some of the $99 million the state received in American Recovery and Reinvestment Act funds for the program in 2009.

State auditors found deficiencies in more than half the files for 444 homes in the program.

The problems included lack of adequate documentation, such as verification that applicants met income eligibility requirements and properly completed inspection reports.

In 45% of 84 site visits, auditors found homes where energy inspectors approved the work though the contractors did not perform some tasks, failed to properly complete the required tasks, or did work that was not allowed under the program. Other deficiencies included the use of uncertified persons to perform energy audits and the use of an unlicensed contractor.

In a response to Wilson’s letter, Human Services Commissioner Virginia Lodge said she was puzzled because the problems already had been discussed with auditors and addressed.

Wilson said a final report would be included in the comprehensive audit of federal financial assistance received by state government March 31.

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