The federal government is prioritizing a review of Alaska’s use of CARES Act funds

ANCHORAGE, Alaska (KTUU) - Late last month, Legislative Auditor Kris Curtis informed Alaska’s Legislative Budget and Audit Committee that the U.S. Department of the Treasury planned to review the state’s use of coronavirus relief funding, provided through the CARES Act. According to Rep. Chris Tuck, former chair and current vice-chair of the committee, Curtis indicated that a large number of complaints related to Anchorage’s usage of CARES money likely drew federal attention to Alaska.

“We are one of four entities that are going to have a deep review of how we spent the money and it was basically because of the number of complaints that we had, turned in to the inspector general of the U.S. Treasury,” Tuck told Alaska’s News Source on Tuesday.

Last year, members of the Anchorage Assembly and the Berkowitz administration met with representatives from the Office of the Inspector General, which directed the Mayor’s team to follow-up with the Treasury Department.

This week, Assembly Chair Felix Rivera said that the administration had taken federal guidance at the time.

“They laid out some different pathways in which we could spend the money and we followed their advice,” he said.

The Midtown representative says the review process is standard and that he feels confident that the review will pass without any issues.

It’s true that every state will undergo a similar “desk review,” but with a large number of complaints filed in relation to the Municipality’s plans to spend CARES money on buildings to shelter and treat the homeless, Alaska has been bumped up to the top of the list. Eagle River’s Assembly Representative, Jamie Allard was not surprised by the news.

When the meeting with the inspector general’s office occurred last August, Allard says she was initially denied the opportunity to sit in. She was given access after going directly to the Department of Treasury and requesting to participate.

“In the course of the entire meeting, it was very clear what the CRF (coronavirus relief funds) were to be used for, very clear,” she said. “I forewarned, and said ‘This is going to be audited,’ and it did.”

According to Allard, she had the opportunity to speak up at one point during the meeting and told the acting inspector general that others on the call were manipulating the truth. Following the announcement that Alaska will be one of the first states to undergo a federal review of its CARES Act appropriations, Eagle River’s representative was supportive and said that elected officials need to be held accountable for their actions.

“I’m worried for the taxpayer,” Allard said. “If we are found at fault — those that voted for it and the administration and the attorneys that advised us that this is okay — then the taxpayers around going to be paying for it.”

When asked about the potential ramifications of a formal audit, Tuck said that the regulations that came along with the CARES Act money were essentially basic guidelines. The responsibility for whatever the review uncovers will ultimately fall onto legislators, as they are the ones that were charged with appropriating the money in question.

“I don’t think there’s anything more enforceable than saying: ‘Hey, you should be paying us back for this’, because it wasn’t part of those guidelines,” Tuck said.

On Tuesday afternoon, Jeff Turner, the communications director for Gov. Mike Dunleavy, said via email that he was unaware of any indication of this review being related to Anchorage’s use of CARES Act funding.

Curtis responded Wednesday morning confirming that details were released in the memo to the legislative budget and audit committee in February.

The Treasury Department’s review should be completed before the end of August; however, if any misuse of funds is uncovered, it could lead to further review or a formal audit.

Editor’s Note: This story has been updated to include a response from Legislative Auditor Kris Curtis.

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