Report 98-12 contains the auditor's reports on internal control and compliance, findings of noncompliance with federal requirements, and the results of our follow-up to prior audit findings; agencies' responses to our recommendations and their plans for corrective action; and the Schedule of Expenditures of Federal Awards. We have identified $417,036 in questioned costs. However, the amount the State may be required to repay the federal government is likely to be less than this amount because the federal government may resolve our findings in a manner that does not require the State to return funds to them. For example, the federal government may allow the State to substitute other expenditures to replace the expenditures that we question.
The largest area of questioned costs relates to the indirect and overhead costs charged to federal grants by the Department of Administration (DOA). Typically, state agencies calculate eligible indirect costs based on a percentage of the total salaries and fringe benefits charged to the federal grants. When calculating its indirect cost rate, which must be approved by the federal government, DOA included $2.1 million of central service costs that were also allocated to other state agencies to be included in their calculations. Therefore, DOA's indirect cost rate was too high, resulting in $146,720 of questioned costs. We also question $68,952 of overhead costs that DOA charged to federal subgrants because DOA did not seek approval of its methodology to allocate such costs to these grants. In both cases, the amount that may need to be paid back to the federal government may be less than the amount questioned. For the indirect cost rate error, we note that DOA could have included other costs in its rate calculations that may offset the amount we question.
The next largest area of questioned costs relates to interest charges. The federal government has rules prohibiting states from claiming federal reimbursement for interest charges incurred in financing buildings constructed prior to October 1, 1980. We question $93,905 that the Department of Workforce Development claimed for such interest charges. We have expressed similar concerns in prior years. The Department of Workforce Development has agreed to reimburse the federal programs for interest charged during our audit period and to discontinue charging building interest to federal grants in the future.
In addition, we question $36,181 in costs that the Department of Natural Resources charged to one of the grants because, based on data provided by DNR staff, it appears the grant was overallocated non-administrative indirect costs. DNR did not maintain sufficient documentation to show that the methods used to allocate these costs were accurate. This area of concern affects almost all of the grants that DNR administers.
S756
We question $46,676 in costs claimed by the Department of Agriculture, Trade and Consumer Protection because it did not require all of its employes to document their work effort by completing time reports, as required by the federal government. Finally, we question $24,602 in costs for a variety of other findings at various state agencies.
Our unqualified audit opinion on the State's financial statements was included in the Comprehensive Annual Financial Report for the fiscal year ended June 30, 1997. This report was published by the Department of Administration in December 1997 and is available from the State Controller's Office in the Department of Administration.
Our single audit report is lengthy and detailed. We are, therefore, limiting our initial distribution of the report to those required by law to receive copies; the audited state agencies and the federal agencies to which our findings relate. However, if you are interested in receiving a copy of the single audit report, please contact our office and request report 98-12.
Sincerely,
Janice Mueller
State Auditor
State of Wisconsin
Department of Health and Family Services
July 30, 1998
The Honorable, The Senate:
Section
46.972(4) of the statutes requires the Department of Health and Family Services to submit to the Legislature a report each year on the allocation and expenditure of funds for services for homeless individuals with severe and persistent mental illness. Attached is the report for calendar year 1997.
Sincerely,
Joe Leean
Secretary
State of Wisconsin
Ethics Board
July 28, 1998, 1998
The Honorable, The Senate/Legislature:
At the direction of s.
13.685(7),
Wisconsin Statutes, I am furnishing you with the names of organizations recently registered with the Ethics Board that employ one or more individuals to affect state legislation or administrative rules, and notifying you of changes in the Ethics Board's records of licensed lobbyists and their employers. For each recently registered organization I have included the organization's description of the general area of legislative or administrative action that it attempts to influence and the name of each licensed lobbyist that the organization has authorized to act on its behalf.
Organization's authorization of additional lobbyists:
The following organizations previously registered with the Ethics Board have authorized to act on their behalf these additional licensed lobbyists:
Health Care Assn, Inc, Wisconsin
Broydrick, William
McIntosh, Forbes
Managed Health Services Insurance Corp
Broydrick, Cynthia
Milwaukee Metropolitan Sewerage District
Petak, George
Ulijasz, Pamela
Potato and Vegetable Growers Assn, Wisconsin
Carter, Michael
Termination of lobbying authorizations:
The following individuals are no longer authorized to lobby on behalf of the organizations listed below, as of the dates indicated.
Funeral Directors Assn, Wisconsin
Morris, Wilma 7/27/98
Oneida Tribe of Indians of Wisconsin
Chrnelich, Joseph 7/23/98
Pharmacy Society of Wis (formerly Pharmacists Assn, Wis)
Decker, Christopher 7/23/98
Tobacco Institute, The
Klauser, David 7/23/98
Organization's cessation of lobbying activity:
The following organizations previously registered with the Ethics Board as employers of lobbyists have indicated a cessation of all lobbying activity effective on the dates shown.
PrimeCare Health Plan, Inc 7/23/98
Also available from the Wisconsin Ethics Board are reports identifying the amount and value of time state agencies have spent to affect legislative action and reports of expenditures for lobbying activities filed by the organizations that employ lobbyists.
Sincerely,
Roth Judd
Director
__________________
State of Wisconsin
Office of the Governor
July 22, 1998
The Honorable, The Senate:
I am pleased to nominate and with the advice and consent of the Senate, do appoint Condos
, Spyro,
of Lake Geneva, as a member of the Judicial Commission, to serve for the term ending August 1, 2001.
Sincerely,
TOMMY G. THOMPSON
Governor
Read and referred to committee on Judiciary.
State of Wisconsin
Office of the Governor
July 22, 1998
The Honorable, The Senate:
I am pleased to nominate and with the advice and consent of the Senate, do appoint Wanzo
, Barbara J.,
of Brown Deer, as a member of the Savings and Loan Review Board, to serve for the interim term ending July 1, 1999.
Sincerely,
TOMMY G. THOMPSON
Governor
Read and referred to committee on Education and Financial Institutions.
Relating to adding butorphanol to the classification of controlled substances in schedule IV of chapter 961, Stats., the uniform controlled substances act.
Submitted by Department of Regulation and Licensing.
Report received from Agency, July 31, 1998.
Referred to committee on Business, Economic Development and Urban Affairs, August 5, 1998
.
__________________
State of Wisconsin
Revisor of Statutes Bureau
August 1, 1998
To the Honorable, the Senate:
The following rules have been published:
Sincerely,
GARY L. POULSON
Deputy Revisor
__________________
for the Month of July 1998
A certificate of congratulations by the Wisconsin Senate on the motion of Senator Jauch, for AMSOIL, Inc., founded and headed by Albert J. "Al" Amatuzio on the occasion of the celebration of twenty five years of production.
A certificate of commendation by the Wisconsin Senate on the motion of Senator Decker, for Robert R. Amelse, on the occasion of earning and attaining the rank of the Eagle Scout Award.
