The value of compliance audits for federally funded state home Weatherization Assistance Programs

The COVID-19 pandemic has shined a light on the extreme value of federally funded programs and services. As more individuals and families are staying home, Weatherization Assistance Programs (WAPs) have become crucial for low-income and underserved communities, as many of the goods and services provided via WAP programs have become indispensable for residents during the pandemic.

States must ensure their WAPs remain in compliance with federal and state regulations and departmental program policies. By maintaining compliance, state programs can continue to secure funds and bolster their services to meet the community's needs.

Compliance considerations and requirements

Federally funded programs like the WAP require an additional layer of compliance in addition to state laws and statutes. To continue to receive funds, state WAPs must operate within federal regulations and meet specific annual compliance requirements. The Department of Energy (DOE) provides oversight of all state-administered WAPs. In addition to DOE oversight, the Department of Health and Human Services (HHS) plays a role in compliance for state programs that utilize combined funding sources.

The following are examples of compliance monitoring activities.

DOE weatherization monitoring

Weatherization monitoring conducted by the DOE is the primary way the agency ensures programs continue to meet requirements. Per 10 CFR 440.23(b), periodic monitoring of WAP grantees (states) must be completed by the DOE. Monitoring is usually conducted in multiple forms that include onsite, ad hoc and desk monitoring.

State grantee monitoring

As the DOE continues to monitor program activities, per 10 CFR 440.23 grantees are responsible for establishing annual monitoring plans and performing annual monitoring of local subgrantees that provide weatherization services on behalf of the state. Monitoring activities should focus on:

• Oversight of program expenditures
• Oversight of program implementation
• Subgrantee program compliance
• Monitoring of contractor payments and reimbursement reports

Compliance is critical for these types of programs as non-compliance can disrupt WAP program performance and service by losing the federal funds that directly impact the job market and communities the state serves.