INDIAN ISLAND, Maine — The Department of Justice’s Office of the Inspector General audited four federal grants awarded to the Penobscot Indian Nation that total nearly $1.19 million and in its report released Friday identified hundreds of thousands of dollars in questionable spending.
“In total, we identified $561,160 in questioned costs, including $237,080 questioned as unsupported, $323,079 questioned as unallowable, and $1,000 questioned as unnecessary,” the 50-page inspector general report states.
“This includes $157,351 in duplicative consultant expenditures for the FY 2009 and 2011 Tribal Youth Program grants and $10,328 in other duplicative questioned costs … resulting in net questioned costs of $393,480,” the report later states.
“We determined that Penobscot Nation’s method for recording expenditures was not reliable,” the report concludes.
The grant funds were issued through the Office of Justice Programs and Office on Violence Against Women to strengthen services to victims of domestic violence, dating violence, sexual assault and stalking; enhance programs for troubled youth; and to improve the tribal court system. The two agencies have agreed to work with the Penobscots to rectify the inspector general’s 14 concerns, and the Department of Justice, in turn, has agreed to resolve the recommendations.
The biggest problem found by the federal agency was the lack of supporting documentation for expenses under $5,000 to ensure they complied with the terms of the grants.
“For the four grants we reviewed, only 11 of the 3,986 purchases exceeded the $5,000 threshold,” the report states. “As a result, Penobscot Nation’s policies and procedures were not sufficient to ensure compliance with the grant award terms and conditions for the majority of the grant purchases because these purchases were not reviewed.”
“In addition, the documentation provided by Penobscot Nation was not sufficient documentation to support the consultant payments because the documents provided for our review lacked sufficient details such as pay rates, hours worked, or reference to a contract,” it states. “We also identified grant-funded positions that were not approved by [Office of Justice Programs] and determined that the salary adjustments charged retroactively to three of the grants were not properly supported.”
Some of the other complaints amounted to missing paperwork or the failure to follow established policies. For example, $59,603 in Office of Justice Programs grant funds were used for a court data and file management system, but “[the Justice Department] found that these costs were unallowable because Penobscot Nation could not provide us with a signed copy of the court database and file management system contract or demonstrate that the contract services were procured after conducting a formal competitive bidding process, as required by the Penobscot Indian Nation Procurement Policy,” the report states.
Some of the concerns are around the departure of the Penobscot Nation Boys and Girls Club in 2012, with the inspector general saying basically that when the Penobscot Nation changed the program, leaders should have requested approval from Office of Justice Programs, especially because the new program does not offer “alternative delinquency prevention services similar to the Boys and Girls Club’s Smart Moves, Street Smarts, Family 16 Hour, and Power Hour.”
The 14 recommendations to the Office of Justice Programs and the Office on Violence Against Women require better accounting, documentation of contracts, salaries and hours worked, written policies and procedures to monitor performance and track approved goals and objectives.
A message left Sunday for comment with Kirk Francis, Penobscot Nation chief, was not immediately returned.
Daniel J. Nelson, chief financial officer for the Penobscot Indian Nation, wrote in a Sept. 22 letter in response to the Justice Department’s draft report that the nation would address the its concerns.
“We have reviewed the ‘Draft Report’ and are prepared for this report to be issued ‘as is’ so we can start working to research and resolve the ‘Findings and Recommendations’ in the report,” Nelson wrote.