New guidance and audit advice issued for use of CARES funds

by Candice Bock, Jacob Ewing | Jul 02, 2020
The Treasury Department released an updated FAQ document allowing for the use of CARES Act COVID-19 Relief Funds (CRF) for FEMA matching requirements and the State Auditor issued guidance for future audits of these funds.

The Treasury Department released an updated FAQ document allowing for the use of CARES Act COVID-19 Relief Funds (CRF) for FEMA matching requirements and the State Auditor issued guidance for future audits of these funds.

The updated guidance states, “Payments from the Fund may be used to meet the non-federal matching requirements for Stafford Act assistance to the extent such matching requirements entail COVID-19-related costs that otherwise satisfy the Fund’s eligibility criteria and the Stafford Act. Regardless of the use of Fund payments for such purposes, FEMA funding is still dependent on FEMA’s determination of eligibility under the Stafford Act.”

The Stafford Disaster Relief and Emergency Assistance Act (Stafford Act) is a 1988 federal law designed to bring federal aid to state and local governments carrying out their responsibility to support residents during a declared disaster. Expanding the allowed use of CRF to include the FEMA matching requirement will enable cities to apply for and receive additional assistance from the federal government in responding to the COVID-19 pandemic.

The full FAQ document from the Treasury Department is available here.

As cities begin using CARES Act Funding from the state, the State Auditor’s Office released guidance to ensure that agencies comply with audit requirements.

In a June 30 letter, the state auditor reminded recipients of CARES Act Funding to “Document, document, document!” Recipients must maintain appropriate records and supporting evidence to show that any costs met the terms and conditions of the award. Additionally, recipients must have evidence that internal controls were in place as money was spent.

The full letter is available for review here.

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