State Auditor Byrd requests $683,000 one-time to expand forensic audits, seeks higher revolving-fund cap

State Auditor Cindy Byrd asked the Senate subcommittee for a $683,000 one-time allocation to expand the auditor’s forensic audit capacity, and proposed lifting the office’s statutory cap on its revolving fund to ease cash-flow and staffing constraints.

Byrd told lawmakers the auditor’s office has seen a sharp increase in federally funded programs and pandemic-relief workload that has doubled mandated single-audit work and driven a rise in reported questionable costs. "The first thing we would do is try to extend that, forensic audit team," Byrd said when asked how the requested one-time money would be used. She said the forensic team — which currently has four auditors — undertakes investigative audits that often produce evidence used in criminal prosecutions and that the team’s work has already helped recover roughly $20 million, with potential additional recoveries reported as possible in recent audits.

Byrd explained that question costs tied to federal grants rose from a historical norm of roughly $5 million per year to about $30 million in recent single audits because of pandemic-era programs and expanded federal grant volume. She told senators the scale and complexity of several federal programs have demanded substantially more audit hours and specialized skills. That has increased unbillable work for the office’s forensic auditors, who assist prosecutors and law-enforcement partners; Byrd said those hours are not fully reimbursed by the small municipalities under audit and that finding qualified forensic auditors remains difficult.

To address the backlog of investigative requests and help district attorneys pursue prosecutions, Byrd requested $683,000 to hire additional forensic auditors and cover start-up costs. She said the one-time funds would provide seed money to hire personnel who could later shift into billable work once the backlog is reduced. Byrd also asked the Legislature to permanently raise the revolving-fund cap set in statute (Title 74, Section 227.9) from $850,000 to $2,000,000 to reduce recurring accounting strain and avoid frequent internal cash transfers required to meet payroll.

Byrd said the office’s fiscal 2024 appropriated revenues were about $4.5 million and that she is seeking $5.4 million for fiscal 2026 (including the one-time request). She noted the office bills agencies for much of its audit work at rates far lower than private firms, and that staffing losses to higher-paying private-sector or other state roles remain a recruiting challenge. Byrd told the committee she has seen turnover fall since a prior appropriation boost — from roughly 23 percent to 12 percent — but warned a wave of retirements among senior auditors could leave the office short of experienced managers.

Ending: Byrd closed by stressing the link between forensic audit staffing and the state’s ability to detect and recover misspent funds, and by offering to provide lawmakers further detail on hiring plans, projected recoveries and timelines for clearing the backlog.