Auditor: Funding rule, law conflict
Posted on Wednesday, December 17, 2008
The East Arkansas Planning and Development District policy of disqualifying groups that applied for General Improvement Fund money without matching funds conflicts with a 2007 state law, Legislative Auditor Roger Norman said Tuesday.
Act 812 of 2007 by Rep. Chris Thyer, D-Jonesboro forbids the requirement of matching funds, Norman said in a letter to the Legislative Joint Auditing Committee.
The state Department of Finance and Administration disbursed $250,000 grants to each of the state's eight planning-and-development districts under the 2007 law, according to the Bureau of Legislative Research.
But Mike Cone of Jonesboro, an attorney for the district, said later that the east Arkansas planning and development district disagrees with Norman.
The district's position is that Act 812 "does not in any way limit" the districts from requiring grant recipients to provide matching funds or inkind services, Cone said in a letter to Norman dated Tuesday.
The district awarded $250,000 to 17 groups and had disbursed $65,847 of it as of Nov. 17, according to information provided to the committee.
Among others, the district awarded $19,000 apiece to Corning Area Healthcare Inc., Boys and Girls Club of Mississippi County, and Wynne Community Enlightenment and Development Foundation; and $18,000 each to Tri-County Rural Health Network Inc., Boys and Girls Club of St. Francis County, Lee County Community Development Corp. and Families in Transition.
The district also required a number of documents from applicants not required by other districts in awarding funds, although they were permitted, Norman said.
He said the district uniquely required its applicants for funds to have Internal Revenue Service recognition as a 501(c)(3) - or nonprofit - organization; financial statements prepared by a Certified Public Accountant or the most-recent audit report; resume of the project administrator; articles of incorporation; license of the applicant to operate; and a list of the board of directors and board meeting schedules.
The district's executive director, Richard Spelic, said in a letter to Norman that a scheduling conflict prevented him from attending Tuesday's meeting but he "would welcome the opportunity to discuss with you the issue addressed in your letter at another time."
Lawmakers said they hope to meet with district officials next month.
Contacted at his off ice, Spelic referred questions to Cone.
Rep. Mike Patterson, D-Piggott, told lawmakers that he didn't know the groups had to fill out an application of about 18 pages for the funds from the district while other organizations had to fill out a one-page application for funds from the other districts.
"I have got 15 mayors that I am responsible for, and I thought my money was going to go to 12 different ones" after he met with Spelic, Patterson said.
Patterson said he told the district to give hiss money to Corning Health Care because that's the only person in his area that had an application.
"We were supposed to get $20,500. Corning Health Care was awarded $19,000 and to this day they have just got $4,100," he said. "I think it's a joke, that it's the biggest embarrassment that I have seen out of any office that I have been involved in since I have been a legislator."
Afterward, Patterson said he merely recommended where the district should spend its grant money.
Cone said he understands that a committee was formed to process each of the applications and that the district's staff didn't determine recipients. It's unfortunate that Patterson feels that way, Cone said.
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