RALEIGH — A report by the N.C. State Auditor’s Office found that the Department of Commerce’s Division of Workforce Solutions (DWS) did not “design and implement procedures” to make sure that certain funds were spent in accordance with state and federal laws.
The findings by the N.C. State Auditor’s Office (NCSAO) focused on federal Workforce Innovation and Opportunity Act (WIOA) funds. The funds are meant to aid job seekers in finding work, accessing education opportunities, training, and support services as well as connecting employers with skilled workers.
According to the report, the lack of procedures increased the risk for local development boards to spend money on items other than allowable WIOA program activities.
North Carolina receives funding from the United States Department of Labor for the administration of the adult program, dislocated worker program, youth program and national dislocated worker grants.
“The four WIOA programs included in this audit’s scope received and spent approximately $158 million of WIOA funds from July 1, 2020, through June 30, 2022, and reported providing services to approximately 21,000 program participants,” the NCSAO report states.
The WIOA program activities are administered locally through 23 local workforce development boards.
Among the key findings in the report, there was no monitoring for the $128 million in WIOA grant funds.
“DWS did not monitor $128 million (81%) of $158 million local workforce development board spending to ensure that WIOA funds were used for programs to help 21,000 job seekers access employment, education, training, and support services to succeed in the labor market,” states the report’s findings.
Issues found in the report included DWS failing to examine payment vouchers, local board accounting records, canceled checks and other documentation.
Examples given included DWS being unable to make sure local workforce development boards spent $54 million on allowable activities for the Dislocated Worker Program and $50 million on allowable activities for the Youth Program.
The report recommended that DWS monitor local workforce development board activities and its spending of WIOA funds as well as make sure that such activities followed state and federal law.
In a response letter to the NCSOA’s report, Department of Commerce Secretary Machelle Sanders agreed with the findings and wrote that “many of the strategies recommended in the audit has already been implemented or are in the process of being implemented.”
“DWS management stated that it did not monitor 100% of local workforce development board activities and spending because limited staff hindered its ability to promptly schedule the annual reviews,” according to the report.
