Auditor general warns D.C. on stimulus oversight in Pa.

HARRISBURG - Pennsylvania's state government might not be open and accountable enough as it handles federal stimulus money, the state's fiscal watchdog warned in a letter to federal officials obtained by the Associated Press yesterday. A spokesman for Gov. Rendell disagreed.

Auditor General Jack Wagner's letter to the U.S. Government Accountability Office warned that internal controls were so weak that information about how stimulus funds were spent would be unreliable without an independent audit agency's oversight.

"We are extremely concerned about the potential for a lack of statewide government transparency and accountability in the use of these vitally important funds," Wagner wrote to Phillip R. Herr, the federal agency's director of physical infrastructure issues.

Wagner listed Medicaid, low-income heating aid, and weatherization assistance as examples of federally funded programs administered by the state that had "significant internal control weaknesses." He said a major issue was the limited scope of information provided for the audits his office performed.

Rendell spokesman Chuck Ardo said the administration was unhappy that Wagner aired his criticism in public instead of contacting the Governor's Office.

"We strongly disagreed with the auditor general's practices, procedures, and conclusions in the past and believe his assertions are unwarranted in the present," he said.

Ardo said that a review of potential fraud Wagner identified in the heating-aid program determined the money had been spent properly and that the medical-assistance audit made several errors.

"Clearly the auditor general's motives are not aimed at good government, so it's fair to ask what the true motive might be," Ardo said.

Wagner, a Democrat, has said he was considering a possible campaign for either governor or U.S. Senate in 2010.