Hawaii Claimed Unallowable Community Services Block Grant Costs for Administrative Expenditures Under the Recovery Act

Under the American Recovery and Reinvestment Act of 2009 (Recovery Act), the Hawaii Department of Labor and Industrial Relations, Office of Community Services (State agency), was awarded $5 million in Community Services Block Grant (CSBG) funds for fiscal years 2009 and 2010.

The State agency complied with Federal requirements when distributing the entirety of the $5 million in CSBG Recovery Act funds to four community action agencies (CAA). However, the State agency returned to the Federal Government only $973,000 of the $1.08 million of funds not spent by the CAAs. The State agency claimed the remaining $35,000 as administrative expenditures. These costs were unallowable under the CSBG Recovery Act award.