Review of Unexpended Infant and Toddler Targeted Funds and Quality Targeted Funds Claimed by the Iowa Department of Human Services for Fiscal Years 1998-2003

August 21, 2008 | Audit A-07-07-00231

Executive Summary

Iowa did not comply with Federal requirements when claiming almost $3.2 million in Child Care and Development Fund (CCDF) targeted funds for fiscal years (FYs) 1998-2003. The CCDF, which is administered by the Administration for Children and Families (ACF), assists certain low-income families in obtaining childcare so that family members can work or attend training or education. The CCDF provides targeted discretionary Federal funding for certain activities to improve the availability, quality, and affordability of childcare and to support the administration of these activities.

The State (1) did not refund to the Federal Government unliquidated targeted funds, (2) did not return the funds to the Federal Government when it terminated a contract and transferred funds to a successor contractor after the obligation period for the funds had expired, and (3) did not limit cash advances to the contractor to the minimum amounts needed. In addition, the State did not remit $155,000 of interest earned by the contractor on advanced CCDF targeted funds as required.

We recommended that the State refund $3.2 million of unexpended CCDF targeted funds allotted during FYs 1998-2003, remit $155,000 of interest earned on the funds, ensure that CCDF targeted funds are disbursed in accordance with Federal requirements in the future, and review CCDF targeted funds claimed after the audit period and refund any unallowable amounts. The State agency concurred with our second and fourth recommendations, acknowledged but did not concur with our third recommendation, and did not concur with our first recommendation. The State did not provide any additional information that would cause us to change the recommended refund.

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