Golden Hammer: Waste, unspent funds found in Navajo jobs program

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As thousands of applicants awaited training, a Navajo Nation program to support job education on Indian reservations wasted $16.5 million and let another $13.4 million sit unused, a federal investigation has concluded.

Administered by the Labor Department’s Employment and Training Administration, the funds were given to the Navajo Department of Workforce Development to support job training. But investigators at the department’s internal watchdog said the Native American group let the money sit around untouched.

NDWD’s practice of not using available funds to serve participants has been persistent,” the Labor Department inspector general’s report said. “Despite these unused funds, NDWD only served 62 percent of the planned number of adults, had waiting lists of prospective participants, and had policies that limited re-enrollment for participants that may have needed additional services.”

The organization attempted to roll over $13.4 million in unused funds into the next year’s budget, an amount the inspector general said could fund the program for a year. But that’s $8.5 million more than the program is allowed to roll over by statute, and investigators said the money should go to help train individuals this year.

The mismanagement is the fault of Navajo department, but investigators said the Labor Department has done little to recoup the excessive money. Native American job training programs across the country have reported millions of dollars in excess funding they’re rolling over into the next fiscal year, calling into question whether too much taxpayer money is being handed out.

“ETA was aware of the large amount of unspent funds remaining at the end of each program year,” the inspector general said. “However, ETA had not reallocated these funds; instead ETA asked grantees to voluntarily return unspent funds, which only happened once.”

For wasting millions of dollars without providing job training to the people who need it, the Navajo Department of Workforce Development and the Employment and Training Administration win this week’s Golden Hammer, a distinction awarded by The Washington Times to examples of fiscal abuse and mismanagement.

Labor officials said they would work with the Navajo Nation to improve how money is spent for the program, as well as investigate what wasted funding they should try to get back.

“If the findings are correct, ETA will work with NDWD program to implement accounting policies and procedures that demonstrate actual personnel and nonpersonnel costs,” a response from the agency said.

But representatives for the Navajo department challenged the inspector general’s finding that the program left people waiting without training, and said it has had many success stories.

“The Navajo Department of Workforce Development has been implementing much-needed employment and training programs for the Navajo Nation for many years,” the response said. “We consider all audit reviews as positive feedback to make continuous improvements to serve constituents.”

Investigators said it’s important for more people to get the training because it has been successful at getting jobs for large numbers of participants. Most people wound up working for the Navajo Nation government, with an average annual salary around $20,000, the inspector general said.

But watchdogs have also criticized the slow rate at which money went to help people. After announcing the award, the Labor Department makes the funds available for use typically just three months later. The NDWD, however, isn’t spending any money until 15 months after the announcement, the inspector general said.

The program had arbitrary limits in place of how many people it would train, despite the fact that funding was available to help many more participants, the watchdog said. For example, only half of high school dropouts who participated in the program actually received any vocational training.

To top it all off, the inspector general said NDWD misspent an additional $16.5 million in funding, including paying salaries or personnel costs without supporting documentation and paying salaries using money earmarked for job training.

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