State & Local Reports

What Was Performed? A financial statement audit of the State of Delaware 401(a)Match Plan for Calendar Years Ended December 31, 2019 and 2020.WhyThis Engagement? This engagement was conducted in accordance with 29 Del. C. §§2906, 6058 and 2722.The 401(a) Match Plan voluntary retirement program is available to most state employees,including employees of the General Assembly, the judicial branch and higher educationinstitutions. This plan allows employees to create additional retirement income security.As of December 31, 2020, the 401(a) Match Plan had approximately 9,000 participants and anet position of about $25 million.What Was Found? It is my pleasure to report this audit contained an unmodified opinion.1The 401(a) Match Plan Annual Report for Calendar Years ended December 31, 2019 and 2020,can be found here.Please do not reply to this email. For any questions regarding the attached report, pleasecontact State Auditor Kathleen K. McGuiness at Kathleen.Mcguiness@delaware.gov.

What Was Performed? A financial statement audit of the Delaware HealthInformation Network for fiscal years ended June 30, 2019 and 2020.WhyThis Engagement? This engagement was performed in accordance with 16 Del. C. §10303(a)(18) and 29 Del. C. § 2906.The Delaware Health Information Network (DHIN) was created by the General Assembly in1997 as a public-private partnership to benefit all Delawareans. DHIN became a publicinstrumentality of the state in 2011.DHIN is the sole corporate member of the Delaware Center for Health Innovation Inc.(DCHI), a charitable nonstock corporation incorporated in 2014. DCHI was created tofurther the efforts of the Delaware Health Care Commission (DHCC). The goal of DHIN is toadvance the creation of a statewide health information network and to address Delaware’sneeds for timely, reliable and relevant healthcare information. DHIN’s major operation is thedesign and implementation of an integrated statewide health system.DHIN’s activities are financed and operated as an enterprise fund in such a way that costsand expenses of providing services are primarily recovered through user charges. DHIN’snet position decreased 3 percent in FY19 and increased 19 percent in FY20. Operatingexpenses exceeded operating revenue both years.DHIN revenue included results delivery revenue from related parties, community healthrecord fees and professional service income. DHIN’s operating revenue increased 14 percentin FY19 and decreased 10 percent in FY20. Those fluctuations were related to DHIN’sservices to DHCC, which supports the development of Delaware’s Health Care ClaimsDatabase (HCCD). DHCC funded these costs through a $2 million State Innovation Modelgrant.DHIN was also approved for a $505,567 federal Paycheck Protection Program (PPP) loan inMay 2020 amid changing federal guidance regarding which entities qualified for such loans.At DHIN’s request, the federal government waived the loan repayment in December 2020.DHIN expected to use these funds to support employee salaries in FY21; however, our officehas not yet audited DHIN’s FY21 statements to confirm the use of that money.What Was Found? It is my pleasure to report this audit contained an unmodified opinion.1The Delaware Health Information Network Financial Statement Audit for Fiscal Years endedJune 30, 2019 and 2020, can be found on auditor.delaware.gov.For any questions regarding the attached report, please contact State Auditor Kathleen K.McGuiness at Kathleen.Mcguiness@delaware.gov.

Why This Report? This financial statement audit was performed in accordance with 29 Del. C. § 2906and 3 Del C. §§ 904(a)(8) and 904(a)(9).The Department of Agriculture manages Delaware’s Agricultural Lands (Aglands) Preservation Program.This program, established in 1991, allows landowners to voluntarily preserve their farms through a twophaseprocess. There are 490,000 acres of farms, which comprise 39% of the land area in Delaware.Delaware’s farmland preservation program has two major components: Agricultural PreservationDistricts and Agricultural Conservation Easements.Preservation Districts are voluntary agreements where landowners agree to continue to only use their landonly for agriculture for at least 10 years. Agricultural easements are purchases of development rights bythe foundation, placing a permanent agricultural conservation easement on the property. Landownersmust enroll their farm into a Preservation District before they can sell an easement.In FY21, the Aglands program received $5 million from the state Bond Bill and $48,621 from the state’soperating budget.What Was Found? It is my pleasure to report this audit contained an unmodified opinion.1The audited financial statements of Delaware Agricultural Lands Preservation Foundation for FiscalYears 2020 and 2021 can be found on our website auditor.delaware.gov.

What Was Performed? A financial statement audit ofthe Delaware State Lottery’s Annual ComprehensiveFinancial Report for Fiscal Years 2020 and 2021.Why This Engagement? This engagement was performed in accordance with 29 Del. C. § 4816 and 29 Del.C. § 2906.On Dec. 9, 2021, an audit of the Delaware State Lottery’s Financial Statements was released. That auditpresented only basic financial statements about the lottery.This engagement is for the Delaware State Lottery’s Annual Comprehensive Financial Report (ACFR). Incontrast, the ACFR presents a wider variety of important information to help readers properlyunderstand the basic statements. This allows the Delaware State Lottery to participate in the GovernmentFinancial Officers Association (GFOA) ACFR certification program, which it has participated in for over 20years.Unlike many other state lotteries, the Delaware Lottery’s revenue is not earmarked for any specific causeor group. Instead, the lottery generates income for the state’s General Fund.The General Fund is a pool of money that finances a variety of state services, such as youth education,neighborhood protection from crime and pollution, parks and beaches maintenance, and healthcare forfamilies and seniors. In this way, the Delaware Lottery helps pay for services that otherwise would requireadditional tax dollars.The Delaware Lottery contributed over $175 million to the state’s General Fund in Fiscal Year 2020 and$216 million to the state’s General Fund in Fiscal Year 2021.The Delaware Lottery requested a comparative report reflecting the past two fiscal years.What Was Found? It’s my pleasure to report this audit contains an unmodified opinion.1 There were nofindings required to be reported under Government Auditing Standards.

This report examines the damage the pandemic has inflicted on the restaurant, retail, and recreation sectors, and considers the distribution of federal funds for businesses in the City, particularly for businesses in low- and moderate-income communities and in historically underutilized business zones. While approaches to targeting federal funding have improved, the City and the State have already recognized that they need to do more to assist the City’s disadvantaged businesses. The state of these sectors suggests support may be necessary for some time for them to fully recover

The audit examined whether CHIA maintained information that was updated at least annually on its consumer healthcare information website, CompareCare, as required by state law. The audit examined the period of January 1, 2019 through November 30, 2020.

The audit examined CHD’s compliance with its representative payee process for residents of Department of Developmental Services (DDS) and Department of Mental Health (DMH) group homes, examined the complaint processes for DDS and DMH-funded group homes and programs, and determined whether the duties and membership composition of the CHD human rights committee (HRC) complied with the HRC bylaws and applicable policies, procedures, and regulations. The audit examined the period from period July 1, 2018 through June 30, 2020.

What Was Performed? A special report of the Delaware Volunteer Fire Service for the fiscal year ended June 30, 2021.The Delaware Volunteer Fire Service is responsible for fire, rescue, emergency medical and other emergency-response-related services for local jurisdictions. Their operational activities include accounting, equipment purchases and maintenance of vehicles and gear, and management of facilities. Why This Engagement? This engagement was performed in accordance with 16 Del. C. § 6608, which requires each volunteer fire company to submit a completed audit by an independent certified public accounting firm to the State Fire Commission annually within six months of the end of the fiscal year.What Was Found? After performing a detailed cost analysis of all volunteer fire companies’ annual financial statements, my team and I determined that the Volunteer Fire Service saved Delaware taxpayers approximately $255.7 million in FY21. This amount was determined by figuring how much it would cost for the state to have a fully paid fire service instead of having one that largely uses volunteers.In addition, the Audit Team continues to recommend that the Delaware General Assembly create a fund independent of Grant-In-Aid to assist Delaware’s Volunteer Fire Service.The Delaware Fire Service special report for fiscal year ended June 30, 2021, can be found on our website auditor.delaware.gov

On October 27, 2020, the Department notified our Office regarding a potential loss of public funds, as required by state law (RCW 43.09.185). Our investigation determined a misappropriation of unemployment insurance benefit funds occurred at the Department, totaling $315,282, and that the Department made an additional $121,503 in questionable payments related to this situation between January 1, 2020, and December 31, 2020. The Department also referred the case to the U.S. Department of Labor’s Office of Inspector General (OIG) and the Federal Bureau of Investigation (FBI) for investigation

During the COVID-19 pandemic, unemployment in Colorado and nationwide led to an increase in claims for benefits. For example, the Department received 1,100 percent more claims in Calendar Year 2020 than it received in Calendar Year 2019.