The News & Observer
December 3, 2007

Auditor to track pass-through grants

RALEIGH - State Auditor Leslie Merritt said today his office will start tracking state and federal grants that go through local governments to nonprofit groups.

Merritt said that nonprofits in the state get $180 million in such "pass-through" grants.

A recent review of one such grant, involving the New Beginning Community Development Center in East Spencer, showed that the local government was not actively monitoring the program. The town said it bore no responsibility to do so, Merritt said.

That could indicate a more widespread problem with oversight of such grants, he said. His office will try to determine whether state and local governments assume each other is monitoring nonprofits that receive the grants.

"If a shepherd thinks the sheepdog is watching the sheep and vice versa, it is all too easy for a wolf to sneak in and steal from the flock, or in our case, $180 million of taxpayer money," Merritt said in a news release.

More on this issue:

Red Clay Citizen:  State Auditor to More Closely Monitor Tax Dollars

The Leland Tribune:  Auditor Merritt announces new initiative to track local government grants

Click here to view the report: 
http://www.ncauditor.net/EPSWeb/Reports/PressReleases/PRS-2007-0012.pdf