Manhunt for Oklahoma man accused of shooting 6 people leaving two dead

Audit claims ‘poor management” of money after Oklahoma disasters

OKLAHOMA CITY - An audit from the U.S. Inspector General says the Oklahoma Department of Commerce was "informal" and displayed "systemic weakness of control" when handing out federal money following disasters in 2011, 2012 and 2013.

The audit, dated Sept. 30, details what it describes as "poor management of [federal] funds," noting millions of dollars went to projects that were neither eligible for aid nor properly documented.

"The State failed to support how it determined activity eligibility, existence, disaster event qualification, reasonableness of cost estimates, prioritization and fund allocation as required," auditors found. "Further, it routinely made payments based on incomplete, insufficient or no supporting documentation."

In all, the audit lists $11.7 million in unsupported obligations and $4.3 million in expenditures.

Two examples of mismanagement are provided following wildfires in Creek County in 2012. In the first, the audit claims the state changed its "narrative" when requesting money to construct an apartment complex to house people lost their homes. According to the audit, the grants from the Department of Housing and Urban Development did not allow for the new construction.

Auditors also say the Department of Commerce failed to follow procedure when awarding money to the City of Sapulpa for firefighting equipment.

"The City intended to replace old equipment and expand its service fleet as opposed to mitigation and resiliency against future wildfires," according to the audit.

A third example claims the state "failed to inspect and verify tornado-related damage" before cutting a $268,000 check to resurface a road in Lincoln County following a 2013 tornado near Carney. Though there was damage in the area, according to the audit, the road appeared to be unpaved, something the Department of Commerce disputes.

"This was a road that had been paved," said spokeswoman Leslie Blair, referring to an image from Google Maps that appears to show a paved road photographed in 2008. "People had been monitoring the project. So it’s a fundamental disagreement we have with the Office of the Inspector General."

The audit is just an advisory report and Blair says her department has already submitted a 27-point response. The Department of Commerce maintains it was just following procedures taught by the Department of Housing and Urban Development, which had supervised the process.

"We went through the technical training with HUD, HUD signed off on every purchase and payment that was processed," Blair said. "We take federal dollars very seriously and again are stewards of taxpayer dollars, so we would not allow any projects that were disallowed or things that are illegal to happen."

The Department of Commerce says it has already received new recommendations on how to better follow federal guidelines. If the Inspector General is found to be correct, it could result in deductions in future HUD grants.

HUD has four months to prepare its own report in accordance with the audit.

The Inspector General has recommended the Department of Commerce implement new policies and procedures for better documentation, to properly obligate $11.7 million and to support or repay the $4.3 million in unsupported expenditures.