Project Joblinks Earthquake Recovery Grant

U.S. Department of Labor Office of Inspector General

Audit Report

Audit of a Project Joblinks Earthquake Recovery Grant

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Report Title: Audit of a Project Joblinks Earthquake Recovery Grant

Report Number: 18-98-007-03-001

Issue Date: April 7, 1998

Following the January 1994 Northridge earthquake, Congress passed a supplemental appropriation to fund a variety of post-earthquake rehabilitation activities. In January 1995, DOL awarded Los Angeles County a $5 million grant to provide pre-apprenticeship training to 1,000 young adults living in the five Service Delivery Areas most impacted by the earthquake. Once these individuals completed the training, they were to be placed in apprentice positions with firms engaged in earthquake recovery and other Federally-funded construction projects. The grant required that at least 85 percent of the participants be between 18 and 35 years of age, and that no more that 15 percent of the participants be between 36 and 40. The OIG audited the $4.2 million exended for the period January 1995 through June 1997.

The OIG found that Los Angeles County was effectively providing the services required by the grant. Furthermore, the grant funds were, for the most part, properly expended. The audit resulted in questioned costs totaling $89,576, or about 2 percent of the overall grant. The minor questioned costs were for such things as: (1) unsupported charges -- $75,446, (2) ineligible participants -- $3,979, (3) prior year costs being allocated to the current year -- $5,552, and (4) overpayments for pay point completions -- $4,559.

In addition, the OIG noted that the grant limited the County to $125,000 for overall administration of the grant. It further stipulated that any funds not used for this should be used for regular Joblinks program activities. However, LA County interpreted this to mean that the funds were earmarked for administrative purposes and added the $125,000 to its internally created administrative budget. Since these funds were not separately accounted for, OIG was unable to determine whether any of these funds could have been expended for the participants.

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