A state audit questions how the Nebraska Department of Health and Human Services distributed $17.6 million in federal utility assistance money, zeroing in on how DHHS handled $7.7 million of that total.
State Auditor Mike Foley unveiled the audit’s findings during a news conference he held in his Capitol office along with DHHS CEO Kerry Winterer.
Nebraska receives $42 million from the federal government annually to help the poor pay utility bills. The problem disclosed by the audit occurred in late August of 2011, when the federal government informed the state it had to spend the $17.6 million or lose it.
DHHS made 43,000 separate payments in distributing the money from the Low Income Home Energy Assistance Program (LIHEAP). Though the audit questions how DHHS spent the entire $17.6 million, it focused on $7.7 million of the total.
Foley said that money, distributed through checks totaling either $250 or $500, should have gone directly to utilities, but instead went to residents who well may have misspent the money.
“In a random sample, for example, we found payments being cashed at the Ralston Keno. We found quite a number of payments cashed at Wal-Mart. Lots of payments cashed at grocery stories, paycheck advance-type places and so forth,” Foley told reporters.
Winterer objected to reaching a conclusion that none of that money went to offset utility bills. He noted residents who qualify for the program receive the money, which could reimburse them for utility bills already paid. He added that many LIHEAP participants have no checking account.
Winterer agreed with the audit’s conclusion that DHHS failed to follow its own rules when it issued crisis assistance to individuals, rather than direct the payment to the utility.
The state audit disclosed other problems.
Foley said the audit discovered that 261 people who had died received $112,000.
“One recipient, for example, who died in May of 2011 and whose death was known to HHS received a payment and his payment was cashed months later at an Omaha liquor store,” said Foley.
Part of the problem, according to Winterer, is the policy behind the program, policy dictated by the federal government. He explained that if a person qualified for the assistance, they received it.
“There is nothing there that says they have to then take that money and go and pay utility bills,” according to Winterer. “Now, we’d like for them to do that. We would like for them to do that. But, essentially those are the only requirements in order to qualify for that payment.”
Winterer said DHHS is working to fix the problem to make sure utility assistance actually goes to pay utility bills.
AUDIO: State Auditor Mike Foley holds news conference on LIHEAP funding. [22 min.]