Massive task in tracking $5 trillion in federal stimulus spending

WASHINGTON — As more than $5 trillion in coronavirus stimulus funding makes its way into Americans' wallets, business bank accounts and state and local government coffers, watchdogs say the massive spending over the past 15 months will require one of the largest financial oversight efforts in the nation’s history.

New York State Comptroller Thomas DiNapoli said his auditors have been meeting regularly with their federal counterparts to "make sure we understand what is expected of our state agencies" and to ensure the state is not duplicating the federal government’s work.

Congress awarded New York $12.7 billion in relief funding under the American Rescue Plan approved in April and $112 billion in emergency funding under the CARES Act, which was passed in March 2020.

"It is monumental. It’s a huge infusion of federal dollars, and I certainly think it's important that there be transparency and accountability," DiNapoli told Newsday in an interview.

Complicating matters is the patchwork of federal agencies tasked with tracking government spending and rooting out fraud.

Some are not fully staffed or are caught up in partisan battles over appointees, according to government watchdog groups.

The CARES Act Congressional Oversight Commission, a bipartisan panel established to track part of the $2.2 trillion in stimulus spending passed last March, has been working without a chairperson for the past year after House Speaker Nancy Pelosi and Senate GOP Leader Mitch McConnell failed to agree on an appointee.

Another nonpartisan office, the Special Inspector General for Pandemic Recovery, has to date only filled half the 20 auditing positions funded by Congress, according to an April 30 report to Congress.

The "unprecedented number of awards and amount of money is probably straining the capacity for oversight that our agencies have ever had," said Sean Moulton, senior policy analyst for the Project on Government Oversight, a nonpartisan watchdog group based in Washington D.C. that has launched a COVID-19 stimulus spending tracker.

Inspector general offices "are scrambling to figure out even how to look at some of these programs," Moulton said in an interview with Newsday.

"They’re used to looking at tens of thousands of awards, and now we're looking at millions of awards, so it's a different ballgame," he said. "We've given them, through these different pieces of legislation, more money and authority, but it still takes time."

DiNapoli said "to a certain extent" the reporting and tracking requirements tied to the stimulus funding "is still an evolving picture."

"There certainly needs to be more clarification of the accounting guidance that's coming out of Washington," DiNapoli said. "Given the huge amount of federal dollars that we're talking about, there's going to be for our office a lot of dialogue with our federal counterparts and making sure that we are in appropriate ways providing the kind of enhanced accountability I think everybody would expect on how these billions of dollars are going to be spent."

President Joe Biden, who pushed for passage of the $1.9 trillion American Rescue Plan, has taken a different tack when it comes to oversight than former President Donald Trump, who fought congressional efforts to establish an oversight panel when Congress passed the CARES Act.

Trump described the effort as an attempt to launch a "witch hunt" against his presidency during an election year.

In March, Biden named longtime White House economic adviser Gene Sperling to serve as the administration’s point person on coronavirus stimulus spending, saying Sperling would be a "source of accountability."

Asked about oversight of money directed to state and local governments, an administration official told Newsday that the White House is requiring states, cities and counties with populations of more than 250,000 to submit performance reports to the U.S. Treasury Department that also must be posted on their local government websites.

"The posting on the recipient’s website is to ensure governments that receive this funding are transparent with and accountable to their local residents/constituents, supporting public understanding of how their governments are using the substantial resources provided by this program," the official said in an email.

Other administration officials note that Biden, as vice president under former President Barack Obama, oversaw distribution of money from the 2009 American Recovery and Reinvestment Act. A nonpartisan panel said the law had a .2% incidence of waste and fraud.

The Department of Justice last month announced a COVID-19 Fraud Enforcement Task Force that will work with other government agencies to root out fraud and recover stolen funds.

Attorney General Merrick Garland in a memo announcing the task force’s creation said the department would "use every available federal tool — including criminal, civil, and administrative actions — to combat and prevent COVID-19 related fraud. We look forward to working with our federal government colleagues to bring to justice those who seek to profit unlawfully from the pandemic."

However, some existing federal oversight panels have encountered challenges over the past year.

A month after the CARES Act passed, Trump effectively removed the inspector general who was slated to lead a key government panel overseeing the spending.

Trump reassigned Glenn Fine, then the acting Department of Defense inspector general, to a lower level post, effectively making Fine ineligible to serve as head of the Pandemic Response Accountability Committee, a group of federal inspectors general tasked with rooting out fraud and waste in stimulus spending.

The committee is headed by Michael E. Horowitz, the Justice Department's inspector general.

"The public can rest assured that the Pandemic Response Accountability Committee and the Treasury Inspector General will continue to conduct robust, aggressive, and independent oversight over all pandemic-related spending," Horowitz said in a statement in May.

Over the past year, the committee’s investigations have led to more than 300 criminal charges and 84 convictions in pandemic-related cases.