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Audit finds Missouri uses restricted funds for government services

Tuesday, March 2, 2010 | 4:52 p.m. CST

JEFFERSON CITY — Missouri is paying for some government services with money taken from funds restricted for such things as scholarships or veterans' cemeteries, according to a state audit released Tuesday.

The audit questioned the transfer of nearly $3 million from restricted funds in the last two years to pay for internal government functions such as personnel, technology and facility management.

"I believe it is a violation of state law for them to do this," State auditor Susan Montee said.

Missouri commonly transfers money into its general revenue fund from agencies to recover the cost of a service performed by another state office. How much money is taken from a certain agency depends on how much work it is expected to create for state officials.

Montee said, however, that the money is being moved to fill gaps in the general revenue fund. She said $125 million has been transferred since 2002 and questioned whether the state should be taking money from certain funds.

"You can't raid these funds for budget shortfalls," Montee said. "All of these things have specific individuals that should benefit from these funds."

The transfers are approved each year by the legislature, but Montee said lawmakers may not know that some money comes from restricted funds.

Auditors found that $207,137 was taken from the Access Missouri scholarship fund in 2009 and a total of $297,850 was taken from state scholarship funds in 2008 and 2009. During that time, more than $1.4 million was taken from funds intended for veterans' homes and cemeteries and more than $266,000 was taken from the state's workers' compensation fund. State law requires money from these funds to be used solely for their stated purpose.

Montee said the Office of Administration, which maintains these funds, should review each one to find out if it is legal to transfer the money.

The audit found that the Office of Administration is inconsistent in determining what money is exempt from being used to recover administrative costs. It also found that the state made errors in how much money should have been transferred.

"Some years they will leave people out, other years they will include them," Montee said.

The Office of Administration said in a written response that it has a method to determine which funds are automatically exempted from the transfers. Spokeswoman Lori Simms said the office feels that it correctly follows this method and that each department is alerted of it annually.


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