State Rep. Matthew Bierlein, who chairs the House Oversight Subcommittee on Public Health and Food Security, today said a newly released audit of a critical state department raises serious concerns about transparency, accountability, and the state’s management of taxpayer resources.

The nonpartisan Office of the Auditor General identified shortfalls in how the Michigan Department of Health and Human Services monitored Michigan Public Health Institute agreements. The review outlined insufficient documentation, inadequate review procedures, reporting failures, and questions involving the approval of payments totaling hundreds of millions of dollars.

“These findings were extremely concerning when we’re talking about public dollars and public health,” said Bierlein, of Vassar, who also serves as Vice Chair of the House Oversight Committee. “I originally called for this audit and for the House Oversight Committee to look into this relationship because there were questions about whether sufficient safeguards existed through MDHHS to ensure transparency and accountability.

“Those suspicions were validated through what was disclosed in the audit. It’s clear that oversight procedures that were put in to protect taxpayers are being disregarded. We want to make sure we are getting the most out of available dollars and that they are going towards keeping Michigan residents and families healthy instead of being squandered away. Without proper documentation, there’s no way to know that.”

Particulars of the audit’s findings include:

● Repeated instances where MDHHS could not document information it reviewed when approving project budgets, financial reports, and work plans. Nearly 70 percent of the financial status reports reviewed lacked supporting cost documentation and that the department paid approximately $108 million before receiving or reviewing documentation validating project work.

● MPHI affiliate staff and MDHHS employees previously employed by MPHI approved nearly half of the financial status reports reviewed for payment, representing approximately $199 million in payments to the organization.

● MDHHS improperly approved certain indirect costs at a higher reimbursement rate than authorized.

● MDHHS repeatedly failed to provide the Legislature with information required under state reporting requirements. According to auditors, some semiannual reports omitted required project and funding information, and none of the projects reviewed included all reports, studies, and publications required to be reported to the Legislature.

“The message is simple: don’t cut corners and show your work – especially when that work involves taxpayer dollars,” Bierlein said. “It is imperative the department work to shore up these mistakes and we will demand answers for these shortcomings.”