As Acting State Comptroller, Kevin Walsh leads the day-to-day operations of the New Jersey Office of the State Comptroller (OSC) that audits and reviews government programs and operations, investigates misconduct by government employees and officials, scrutinizes the legality of public contracts and recovers improperly expended Medicaid funds. Governor Murphy’s Executive Order No. 166 established the COVID-19 Compliance and Oversight Taskforce to provide compliance guidance to State agencies expending COVID-19 recovery funds. The COVID-19 Compliance and Oversight Taskforce is chaired by Kevin Walsh who presented at the recent 2021 Fall conference of the New Jersey Municipal Management Association.

By last count, the State of New Jersey has received approximately $43 billion in federal COVID aid. Counties and municipalities have or will receive an additional $4.6 billion directly on top of that. Much of the federal funding is flexible and local governments have broad discretion on how to spend it. But there are compliance guidelines, eligible and ineligible uses, and reporting guidelines. Non-compliance could result in the feds recouping funds – with local taxpayers having to foot the bill.

The COVID Compliance and Oversight Project is meant to guide the state’s recovery and to ensure that the many agencies and authorities that are using recovery funds follow uniform practices that lead to accountability and transparency. OSC asks that all municipal managers be on the lookout for public contracts that use COVID funds and duplication of benefits and making sure there’s coordination between state and local programs.

“OSC’s Fraud Hotline is active – and we keep tips confidential,” said Walsh. “We ask that you report fraud from bad actors, or those using inside information for their own benefit as this is one of the ways we can make sure COVID-19 funds are being used properly.”

OSC can be reached at 1-855-OSC-TIPS or for tips.

Jacquelyn A Suarez, Director of NJ Dept. of Community Affairs, Division of Local Government Services then went on to present the American Rescue Plan Act of 2021. The federal American Rescue Plan Act of 2021, signed into law on March 11, 2021, was enacted to provide funding for COVID-19 pandemic response and recovery.

Among the key elements of the Act is the Coronavirus Local Fiscal Recovery Fund (LFRF). Permitted use of grant funds include:

Counties and municipalities may expend LFRF funds for the one or more of the following purposes:

  • Replacing lost public sector revenue
  • Investing in water, sewer, and broadband infrastructure
  • Providing premium pay for essential workers
  • Supporting public health expenditures
  • Addressing COVID-19 related negative economic impacts
  • Addressing the disproportionate public health and economic impacts of the crisis on the hardest-hit communities, populations, and households

States and territories may not use LFRF to directly or indirectly offset a reduction in net tax revenue due to a change in law from March 3, 2021 through the last day of the fiscal year in which the funds provided have been spent. Although this prohibition does not expressly extend to counties and municipalities, because LFRF funds are to be utilized for affirmative assistance measures, those funds should not be used to merely reduce the county or municipal tax levy.