OSC issues guidance to local governments on protecting federal COVID-19 recovery funds from fraud, waste and abuse

Office of the State Comptroller issues guidance to local governments on protecting federal COVID-19 recovery funds from fraud, waste and abuse

Guidance includes best practices and an internal controls checklist for municipalities and counties to use.

Posted on - 06/30/2021

TRENTON – The Office of the State Comptroller (OSC) issued new guidance to local governments in New Jersey today to help municipalities and counties spend federal COVID-19 recovery funds efficiently and effectively. Local governments throughout the state have collectively been allocated almost $3.6 billion in federal funding to respond to COVID-19.

“This guidance is our effort to help local governments make smart decisions about how to use the funds in a way that complies with federal requirements,” said Acting State Comptroller Kevin D. Walsh. “In some cases, the funding may be going to entities that have never received federal funds before, or nowhere near this level of federal funding. Our goals are to educate municipalities so they can protect federal funds from fraud, waste, and abuse and avoid having the federal government reclaim improperly spent funds.”

The guidance includes best practices for spending Local Fiscal Recovery Funds, along with a checklist local governments can use to ensure that internal controls are in place to prevent fraud, waste and abuse. The new resources offer practical guidance to local governments on:

optimizing the planning phase for using the funds appropriately;
conducting successful procurements;
proper documentation and record retention so local governments can fulfill the federal government’s reporting requirements;
establishing internal controls as a check against misuse of funds;
assessing risks of fraud, waste and abuse; and
allocating appropriate staff to spend funds efficiently and ensure appropriate oversight.

For more information regarding OSC’s COVID-19 oversight, including information regarding its newly created COVID-19 Compliance and Oversight Project, visit OSC’s website.

If you have any information regarding the potential fraud or misuse of federal COVID-19 recovery funds, please file an anonymous complaint with OSC or call our confidential hotline at 1-855-OSC-TIPS.

The Office of the State Comptroller (OSC) is an independent State agency that works to make government in New Jersey more efficient, transparent and accountable. OSC is tasked with examining all aspects of government expenditures, conducts audits and investigations of government agencies throughout New Jersey, reviews government contracts, and works to detect and prevent fraud, waste and abuse in Medicaid.

Stay up-to-date with the latest from OSC by following us on Twitter, Facebook, LinkedIn, and on Instagram at @NewJerseyComptroller.