The committee’s deal with the switch follows a December Gazette-Mail report exposing that switch and a subsequent $10 million cost from the fund the leftover {dollars} have been positioned in to Marshall College to help development of a brand new baseball stadium.

“I’m making an attempt to wrap my head round or get a logical rationalization how a baseball discipline would fall below COVID funds,” Sen. Randy Smith, R-Tucker mentioned throughout Friday’s listening to, which committee Chairman Eric Tarr, R-Putnam, mentioned he acquired.

Governor’s Workplace Basic Counsel Berkeley Bentley contended the workplace’s oversight of funding from the CARES (Coronavirus Assist, Aid and Financial Safety) Act was authorized and applicable.

On Sept. 30, nearly a thousand days after Gov. Jim Justice declared a COVID-19 state of emergency in West Virginia, $28,375,985 remained within the state’s CARES Act money stability, based on State Auditor’s Workplace information.

There was $17,864,226 within the Governor’s Workplace Presents, Grants and Donations Fund as of Wednesday, based on the Auditor’s Workplace.

West Virginia acquired $1.25 billion in funding from the CARES Act, which was handed in 2020. Which means $2.26 of each $100 that the federal authorities gave West Virginia went unspent by the deadline to spend it.

Below federal Division of the Treasury steering, any remaining quantity from the Coronavirus Aid Fund established by the CARES Act not used for eligible bills obligated by Dec. 31, 2021, have to be returned to the Treasury. The feds think about unreturned funds a debt owed to them.

Relatively than return the roughly $28.3 million to the federal authorities, the Governor’s Workplace transferred it to the Governor’s Workplace Presents, Grants and Donations Fund, a fund that has been budgeted solely $50,000 in recent times.

Bentley mentioned the state used CARES Act cash to reimburse itself for beforehand paid COVID-related bills, and subsequently, the funding isn’t topic to Treasury steering.

Bentley cited consulting recommendation the Governor’s Workplace acquired in August from a Virginia-based advisor at BDO USA LLP asserting West Virginia may reimburse itself for the unique funding supply used for an expense as soon as that expense is taken into account charged to the state’s COVID aid fund.

“Because of this, for each greenback claimed in opposition to the CRF [Coronavirus Relief Fund] for prices already paid by the State, the State will likely be reimbursed that quantity and have such funding accessible to be used as State funding once more,” David Clark, a managing director at BDO USA, wrote in an electronic mail to Governor’s Workplace Deputy Chief of Workers Ann Urling on Aug. 22, 5 weeks earlier than the CARES Act spending deadline.

BDO USA is the U.S. member of BDO’s world consulting community.

Tarr known as the Governor’s Workplace’s method to the $28.3 million “pseudo-laundering.”

“Isn’t this cash laundering?” Smith requested Bentley.

Bentley asserted in response the CARES Act “clearly contemplated” the states may reimburse themselves, arguing that the state’s mid-April 2020 receipt of CARES Act funding and the regulation’s protection of bills relationship again to March 1 of that yr was an instance.

“The reimbursement doesn’t a second time turn out to be topic to CARES Act necessities,” Bentley contended. “It turns into reimbursement of the state {dollars} that you simply had expended on one thing that turned out to be reimbursable by the federal program.”

The Auditor’s Workplace requested the Governor’s Workplace to ship a memorandum from counsel stating the switch was applicable and never topic to legislative appropriation on Sept. 13, based on an electronic mail chain whose copies have been distributed amongst committee members for Friday’s listening to.

Auditor JB McCuskey informed committee members that his workplace requested for authorized and accounting opinions on the Governor’s Workplace’s deliberate switch 16 days previous to the Treasury deadline to spend that cash.

A memorandum from Bentley that adopted held that any COVID aid funding acquired by the state below the CARES Act wasn’t topic to legislative appropriation and may very well be spent on any lawful function on the governor’s route.

McCuskey known as the Governor’s Workplace’s deliberate switch “uncommon” because of its measurement and the account the place the funding was headed. The Auditor’s Workplace “spent a reasonably appreciable period of time” reviewing the opinions supplied by the Governor’s Workplace, McCuskey mentioned.

“After we received right down to the top of it, our function because it pertains to the Governor’s Workplace isn’t — we will’t supplant our authorized opinion of what their appropriations are if there’s a rational foundation for them, and it was shut,” McCuskey mentioned. “And we determined on the finish of the day it was higher to … effectuate what the Governor’s Workplace wished however to maintain a report and an accounting of what occurred and why.”

On Oct. 5, Justice authorized $10 million from the Presents, Grants and Donations Fund to be paid to Marshall College to help setting up a brand new baseball stadium, based on a letter from Justice to the Auditor’s Workplace.

The switch got here 5 days after the $28.3 million in CARES Act cash was transferred to that fund.

On Sept. 29, Justice introduced a $13.8 million contribution to the stadium mission slated for completion in March 2024. The governor joined Marshall College President Brad Smith and Athletic Director Christian Spears to make the announcement on the future residence of Marshall baseball.

Justice, a Marshall alumnus, offered an outsized $13.8 million examine to the college earlier than throwing out a ceremonial first pitch.

The Governor’s Workplace mentioned the $13.8 million was to return from the West Virginia Water Improvement Authority’s Financial Enhancement Grant program established by way of the Legislature’s allotment of $250 million from the American Rescue Plan Act, a sweeping federal COVID-19 package deal enacted in 2021.

Water Improvement Authority Government Director Marie Prezioso mentioned in a December cellphone interview the Governor’s Workplace later informed her the company solely wanted to offer $3.8 million of the authorized $13.8 million, leaving $10 million left over. Prezioso mentioned she wasn’t knowledgeable why.

There was $252 million within the Financial Enhancement Grant Fund as of December, based on the Auditor’s Workplace.

Bentley informed the committee Justice determined to contribute $10 million to the Marshall baseball stadium mission to “liberate” that quantity for different Water Improvement Authority tasks.

The Governor’s Workplace had not responded to requests for touch upon the $10 million switch from the Presents, Grants and Donations Fund to Marshall in latest months.

“I definitely consider [Justice] dealt with the COVID pandemic fairly nicely,“ Bentley replied when Smith requested him why the governor selected to help the mission with a $10 million contribution. “He’s not simply centered on that … It’s specializing in varied points the state has. He’s not singularly centered on COVID.”

McCuskey mentioned his workplace based mostly its opinion on the legality of the switch on an expectation it might be spent in CARES Act compliance.

“We might have needed to have been mind-readers with the intention to determine what was going to occur with the cash later,” McCuskey mentioned.

McCuskey estimated his workplace answered “a thousand” questions from native governments about how they might use COVID aid {dollars} distributed to them.

“I wasn’t requested if anybody may construct a baseball stadium,” McCuskey mentioned. “Particularly at the start of the steering, it might have been my opinion that we have to follow the concept that this cash was designed for water and sewer infrastructure to repair issues that have been longstanding.”

Bentley mentioned the Governor’s Workplace tried to hunt recommendation from the Treasury Division “a lot of instances.”

“They weren’t overly keen to place issues to paper,” Bentley mentioned.

Requested for a response Friday, a Treasury official referred to Treasury steering made public in 2021 and famous the CARES Act didn’t require the Treasury to preapprove state spending of COVID aid funds. The official referred questions on any misuse of CARES Act {dollars} to the Treasury Workplace of Inspector Basic.

The Treasury Workplace of Inspector Basic didn’t reply to a request for remark Friday and has not responded to previous requests for remark.

Bentley falsely claimed to the committee the Gazette-Mail reported that the state must return the transferred funds to the Treasury, not mentioning the publication by identify.

The COVID bills totaling $28.3 million for which the Governor’s Workplace has claimed reimbursement have been Division of Corrections and Rehabilitation bills, Bentley informed the committee.

“This was simply the primary $28.3 [million] on the listing, I assume,” Bentley mentioned, citing prices to help public-facing division personnel whose jobs entailed having to work together with individuals who had COVID in the course of the pandemic. “These persons are administratively presumed to be eligible for his or her payroll and, I consider, some advantages, if not all advantages, to be coated from the CARES [Act] {dollars}.”

A Governor’s Workplace response to a Gazette-Mail Freedom of Data Act request for the $28.3 million lists payroll bills masking corrections personnel.

Tarr objected to the Governor’s Workplace utilizing $28.3 million in Division of Corrections and Rehabilitation bills to switch the identical whole to a discretionary account that has helped a baseball stadium mission by 100 instances greater than it has supported the company since then.

McCuskey mentioned the Governor’s Workplace may have merely requested that $28.3 million be transferred again to the Division of Corrections and Rehabilitations to cowl the company bills claimed by the workplace for reimbursement.

The Governor’s Workplace Presents, Grants and Donations Fund spent simply $526,809 in non-Marshall baseball stadium mission bills from Oct. 1 by way of Jan. 31, based on the Auditor’s Workplace.

Of that remaining spending, $280,721 went to the Division of Corrections and Rehabilitation for human sources providers. One other $106,000 went to Appalachian Bible School, a personal Christian Bible school in Mount Hope, to help with a brand new mini-bus buy.

Appalachian Bible School has not responded to requests for remark.

Roughly $60,000 and $48,000 have been paid to BDO and Charleston regulation agency Bailey and Glasser LLP, respectively.

The Senate Finance Committee’s 4.5-hour listening to Friday alternated between deal with the $28.3 million switch and funds requests from state company heads.

Bentley mentioned he knew of no plans for the remaining $17,849,176 within the Presents, Grants and Donations Fund, saying the state may obtain lingering COVID-related invoices that may very well be paid from that fund.

“I’m simply taking a look at numerous these supplementals we’re going to be going over,” Sen. Rupie Phillips, R-Logan, mentioned of state company requests to return later within the listening to. “You possibly can knock out numerous the small ones with $18 million.”