State will return $21 million diverted to upgrade IT systems to coronavirus fund

The office of the inspector general says the governor did misuse money allocated to the state under the CARES Act.
Published: Dec. 14, 2020 at 3:10 PM CST
Email This Link
Share on Pinterest
Share on LinkedIn

DES MOINES, Iowa (KCRG) - The governor’s office announced on Monday it will be returning $21 million in CARES Act funding that was going to be used to upgrade computer systems, an expenditure later called improper by the state auditor.

Gov. Kim Reynolds said, in a statement, that the funding would go back into Iowa’s Coronavirus Relief Fund after being diverted toward a project to “modernize” certain computer systems for the state. The money would have been used toward a contract with Workday, which offers various systems for human resources and other areas.

State Auditor Rob Sand issued his rebuke against the expenditure in late October, saying that it could have left Iowans on the hook to repay the federal government the money if it went forward. Reynolds defended the use of the funding, but the Office of the Inspector General in the Treasury Department eventually determined that the allocation was not covered by the language in the CARES Act.

“The COVID-19 pandemic only further highlighted the critical need for integrated IT systems that will improve operational efficiency and effectiveness for the State of Iowa,” Reynolds said, in the statement. “Following multiple conversations with the Treasury Department last spring, we believed we had assurances that the upgrade to Workday qualified as an allowable expense. We would not have moved forward without those assurances.”

The statement from Reynolds office said that $4.45 million had already been spent on the Workday project. The allocation will be returned to the relief fund by December 18.

Reynolds said that the project with Workday would continue due to its importance, but that legislators would need to allocate additional funding to pay for it.

Copyright 2020 KCRG. All rights reserved.