Federal audit flags and $10M federal allotment leave Idaho vocational rehabilitation facing state match, contractor costs and forensic review

The Idaho Division of Vocational Rehabilitation (IDVR) was designated a high-risk federal grantee after legislative auditors found the division ‘‘did not establish procedures and control activities to ensure compliance with appropriation laws applicable to fiscal year 2024,’’ and the federal Rehabilitation Services Administration (RSA) reallocated $10 million to Idaho this fall, a sum the state must match to spend.

Auditors from the Legislative Services Office told the Joint Finance-Appropriations Committee on Feb. 24 that weaknesses in commitment accounting, late billing and case-management reporting left the division with obligations exceeding its appropriations at the end of FY2024 and that federal reporting in some quarters was ‘‘inaccurate and unsupported.’’ April Renfro, the LSO auditor who led the review, said RSA designated IDVR ‘‘as a high risk grantee’’ and required corrective actions and additional oversight.

Why this matters: The federal reallotment increases available federal funds only if Idaho provides the required state-match dollars and resolves control and reporting deficiencies. Lawmakers pressed officials on the financial exposure if federal partners disallow previously billed expenses.

Brooke Dupree, a Legislative Services budget analyst, explained the governor’s noncognizable adjustment: ‘‘The money came from the Rehabilitation Services Administration…when it’s getting close to the end of the federal fiscal year they look at all the grants that they’ve given to states and they see who isn’t…