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Memorandum: The state recognized that some sheriff departments sought and received loans through SBA. Other state governmental entities may have also received PPP loans or may be considering applying for them.

Memorandum: Auditor Office has begun to examine the State's distribution and spending of more than $1.3 billion of federal funding that has been or is expected to be received via the federal pandemic response/stimulus acts – including the CARES Act.

Memorandum: The recently issued U.S. Treasury Coronavirus Relief Fund FAQ1 has implications for the Governor’s proposed Economic Injury Disaster Loan (EIDL) program. As proposed, the Vermont EIDL program to be administered by the Vermont Economic Development Authority (VEDA) establishes a perpetual revolving loan fund. However, the FAQ indicates that all loan repayments subsequent to December 30, 2020 must be returned to the U.S. Treasury.

Memorandum: There is desire to inject the CARES Act funding into the community as soon as possible. However, some aspects of this bill raise concerns about risk that deserve your consideration. Creating the program and appropriating $50 million before the Tax Department has established “a formula for determining the amount of grant awards” is a significant delegation of authority without any guidance.

Memorandum: The Office requests the legislature add an explicit requirement in all future bills authorizing the expenditure of COVID-19 funds. The State Auditor’s Office must have access to records that relate to eligibility for and use of economic recovery grant funds.

Act 115 of 2019 established the Vermont Emergency Economic Recovery Grants program and affords the Agency of Commerce and Community Development (ACCD) and the Department of Taxes (Department) significant discretion for developing guidelines to implement the $152 million program, but the law also requires certain procedures and standards. The guidelines developed by ACCD and the Department – specifically the first-come, first-served distribution of public dollars and the absence of an evaluation of need in the application process – may not be consistent with the legislation. This approach does...

Similar to the Economic Recovery Grant (ERG) programs, the Gap program requires that businesses demonstrate economic loss due to COVID-19 but does not define economic loss. If ACCD uses revenue loss to measure economic loss for businesses that were in operation prior to the pandemic, the Gap program will be exposed to the same risk the Joint Fiscal Office pointed out in its November 2020 memo to the Joint Fiscal Committee regarding the ERG program.

The Economic Recovery Bridge Grant program in H.315 uses 2020 federal tax loss to establish eligibility for grants. Focusing on tax loss may help target limited resources to businesses that need assistance to remain viable. However, federal tax loss could include some deductions that increase 2020 losses but overstate the businesses’ need for financial assistance.

This is the second of two audits pertaining to Vermont’s usage of CRF funds conducted by the State Auditor’s Office. The objectives of this audit were to (1) assess whether and how AHS ensured that only those providers meeting State and Federal requirements received payments under the HCS program and (2) to determine whether selected HCS payments were supported and did not duplicate payments made under other government COVID-19 programs.