CHARLESTON, W.Va. — Heads may be spared based on state agencies meeting this year’s deadline for statewide financial audits.
Almost all state agencies that are required to submit the audits met a final deadline earlier this month.
Then the state’s higher education institutions met their own final deadline on Oct. 31.
“The Department is pleased with the response from the state agencies this year and is working to finalize the Comprehensive Annual Financial Report in a timely manner,” said Diane Holley-Brown, spokeswoman for the state Department of Administration, which has to compile the audits.
Missed deadlines on the audits were what caused Gov. Jim Justice a few months ago to declare in a news release that heads would roll.
The audit has been in the spotlight because West Virginia has missed its overall deadline three years in a row. This year that created repercussions for the higher education system, which was sanctioned by the U.S. Department of Education.
“When I find out who is responsible heads will roll,” Justice said in a statement in July. “Our schools and students are being penalized because of a mistake that’s been brewing two years and ten months before I got here. We’ve got to get to the bottom of it because West Virginians deserve better.”
The administration said it would investigate the ongoing problem as well as step up to make sure deadlines are hit for the coming year.
There has been no confirmation of punishment for agencies that missed their deadlines in the past.
But this year’s process appears to be on track.
The Department of Administration’s Finance Division received the Higher Education consolidated financials prior to the deadline of Oct. 31, said Holley-Brown.
Only a couple of other state agencies that have annual audit deadlines are still working to submit, she said.
“Our staff is working closely with the Division of Highways and the Retiree Health Benefit Trust administered by the Public Employees Insurance Agency (PEIA) to secure their final financial statements,” Holley-Brown said.
“Division of Highways has indicated that they expect their final statements by the end of the week. PEIA’s RHBT requires some updated actuarial statistics to complete their reports but is working toward obtaining the necessary information.”
Once the information is available from all the applicable agencies, the state still has to prepare and file an annual single audit with the help of private auditors.
After several years of warnings, the U.S. Department of Education imposed sanctions including provisional certification and heightened cash monitoring on West Virginia’s higher education system. The sanctions, if not lifted, could be imposed for five years.
The sanctions affect cash flow of millions of dollars for West Virginia’s higher education system.
Under normal conditions, the U.S. Department of Education would provide institutions money up front to be used for expenditures such as Pell grants and federally-subsidized student loans.
Under the sanctions, colleges will have to pay for those expenses first and then ask for reimbursement.
West Virginia Higher Education Chancellor Paul Hill said one of the key differences this year was that necessary Consolidated Public Retirement Board information was available by July this year, whereas in the past two years it hadn’t been available until December.
“If everybody has the tools they need, they can do their job,” Hill said today in a telephone interview. “It wasn’t that everyone was sitting around saying well, I’m just going to be lazy.
“I have to give credit to the Department of Administration. They recognized the problem and they got the CPRB done first and that allowed everyone else to do their job.”
Sarah Armstrong Tucker, chancellor of the state’s community and technical colleges, said today she is relieved that most agencies have hit their deadlines this year. Tucker said that helps make the case to the U.S. Department of Education that sanctions should be lifted.
She said stern messages flew among institutions in attempts to meet the deadline this year.
“I was both the recipient and the sender of said emails, trying to make sure all of our community colleges got their audits in on time so we were able to meet our final audit deadline, which was Oct. 31,” Tucker said.
She still hopes the sanctions may be lifted for the coming year.
“I’m extraordinarily hopeful that that’s the case,” Tucker said. “We’ve been working with both Senator Manchin’s and Senator Capito’s office very closely with the Department of Education to see if they’re willing to provide any leeway whatsoever.”
“I think it was a necessary and important step to show we could get this in on time in order for them to be willing to start removing some of the sanctions.”