Audit: Louisiana DCFS misused TANF money, 2 former workers accused of breaking payroll law
BATON ROUGE, La. (BRPROUD) — An audit report shows that the Louisiana Department of Children and Family Services had financial issues with the Temporary Assistance for Needy Families (TANF) program for 12 straight years.
As part of the audit process, the LLA issued a management letter outlining issues and suggested solutions, which DCFS responded to with any information about the changes being made to fix and avoid future problems.
According to a report from the Louisiana Legislative Auditor, the department did not have supporting documents for recipients working in the program. Sixty out of 28,212 work activity records were sampled, and four eligible participants’ hours were inaccurate.
Federal law requires the state to document each participant’s work through its work verification plan.
DCFS replied, saying they would implement a review process for documentation and verification.
During the 2023 fiscal year, DCFS transferred $16 million of TANF grant funds to the Social Services Block Grant (SSBG). The report indicates a process was not implemented to determine what families were given funds through the grant. Federal law states only families whose income is less than 200% of the poverty level. DCFS used the transferred funds to pay for DCFS caseworkers’ salaries through the Public Assistance Cost Allocation plan, which is not permitted.
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Payroll concerns, potential fraud
DCFS also had issues with proper reporting to the Federal Funding Accountability and Transparency Act (FFATA), improper employee activity and allocating costs for federal programs.
In the audit, two former DCFS employees were suspected to have received earnings from DCFS and another employer for the same hours. The total suspected amount lost is $16,349.
This signals a potential violation of Louisiana payroll laws and department policy.
One of the employees was fired and the other resigned before being notified of the violation.
DCFS said one is ordered to pay back $875. The other is still under investigation.
According to the audit report, the department did not follow payroll procedures and protocols for leave requests and time statements. Out of 45 statements sampled over 12 months, auditors found:
10 of those times were approved up to 252 days after the required policy date.
Three of those time statements were certified 20-70 days after the required policy date.
Two were not certified or approved before payroll processing.
Auditors also said the system automatically approved 5% of leave requests. This happens when the supervisor does not take timely action on the requests before the payroll period ends.
DCFS outlined a plan to avoid these issues in the future.
Audit notes overbilling, underbilling
The audit report stated the department did not have “adequate controls in place” for a plan that assigns funding to federal programs. In a sample of 60 transactions out of 241,344, totaling $387,232,398, two had errors.
In one of the transactions, incorrect supporting documentation was used, which caused incorrection calculations. The department overbilled the SSBG by more than $10,000 and underbilled the Foster Care Title IV-E by over $35,000.
The cost allocation unit created a review process to ensure the proper documentation is available.
According to DCFS’s response, new internal policies and procedures have been created to improve the department’s accuracy.
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