Last October, Governor Kristi Noem outsourced the management of federal coronavirus relief funds to Guidehouse, an international consulting firm. The original contract was for $6,000,000; in January, the state extended that contract through the end of 2021 and upped the fee to $10,000,000.
For that price, Guidehouse rolled those checks out slowly and now has managed to send the wrong amount to 170 South Dakota businesses:
Rough numbers presented to state lawmakers Tuesday indicate that about 140 South Dakota businesses originally received larger COVID-19 grants than they should have and about 30 got less than they were due.
Together those ‘overs’ and ‘unders’ totaled about $4 million, state Finance Commissioner Liza Clark told the Legislature’s Appropriations Committee. “So far it’s been minimal and we’ve paid out anybody who was underpaid,” she said [Bob Mercer, “S.D. Officials Working on Plan to Get Back Covid-19 Grants That Were Overpaid to Businesses,” KELO-TV, 2021.05.11].
Perhaps the “overs” should include the $4M tip we threw out Guidehouse in January, and perhaps the original $6M we threw at them in October thinking they could handle such huge sums more effectively than the state employees already in place to handle our public dollars.
Mercer’s report doesn’t break down how much of the $4M error was “over” that we need to reclaim”; he does say that six of the businesses that Guidehouse overpaid have returned $802K to the state. If Clark’s report to Joint Appropriations yesterday referred strictly to errors in business grants and not to the non-profits and health care providers that have received CRF funds, then Guidehouse’s 170 oopsies equal 3.6% of the 4,775 businesses receiving business grants so far.
I have to wonder if the Bureau of Finance and Management and the Department of Revenue and the State Treasurer put the wrong amount on 3.6% of the checks they issue.