FEDERAL FUNDS: DAS’ Makes Loan To Itself

Secret settlement agreements made to former state workers may not be the only problem at the Iowa Department of Administrative Services.  Emails obtained through an open records request indicate DAS may have misused federal funds.

An October, 2013 email from Rita Grimm with the Iowa Economic Eevelopment Authority indicates former DAS Director, Mike Carroll “abruptly” left a meeting, at which IDEA was trying to “resolve very significant issues raised regarding the DAS Energy Loan Program.

Read the emails

Another document explains why Grimm raised those questions.  The loan of nearly $300,000 was to DAS through a DAS administered program.  The Iowa Attorney General’s Office later “concluded that DAS violated the Department of Energy’s requirements by making the loan to itself.”  The AG’s Office recommended “repayment of the loan, including interest and administrative fees using state funds.”  It also recommended DAS file a report with the DOE explaining its actions.

State Senator Janet Petersen wants the state auditor to investigate.

“It’s a very big deal.  It could jeopardize federal funding,” said Petersen.  “When DAS gets the money, DAS doesn’t just get to decide what pot to put the money in.  There are strict guidelines they need to follow.”

There’s no indication the DOE knew about the loan, but a spokesperson said the DOE does monitor how the monies are used.

A spokesperson for DAS says the loan was repaid using State of Iowa Facilities Improvement Corporation (SIFIC) funds.  But other documents indicate SIFIC funds could not be used to repay the loan.

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