DES MOINES, Iowa – Gov. Kim Reynolds has directed the Iowa Department of Management to return $21 million to Iowa’s Coronavirus Relief Fund. The funds were initially allocated for payments related to the state’s contract with Workday, a cloud-based human resources, finance, and planning system being implemented to modernize the state’s IT infrastructure. Of the allocation, $4.45 million was spent on the project.
“The COVID-19 pandemic only further highlighted the critical need for integrated IT systems that will improve operational efficiency and effectiveness for the State of Iowa,” Reynolds said. “Following multiple conversations with the Treasury Department last spring, we believed we had assurances that the upgrade to Workday qualified as an allowable expense. We would not have moved forward without those assurances.”
The Department of the Treasury’s OIG affirmed its determination that payments for Workday were not allowable expenditures under the CARES Act. While the state still maintains its position that these are allowable expenditures, it respects the decision and will return the funds by December 18.
Replacing the state’s outdated IT systems remains a critical need, and has received overwhelming bipartisan support from the Legislature and elected officials. As such, the Workday implementation will continue as planned. The estimated costs and timelines of the project have not changed. Supplemental funding is needed to support the completion.
Iowa received a total allocation of $1.25 billion from the Coronavirus Relief Fund established by the federal Coronavirus Aid, Relief and Economic Security (CARES) Act. The $4.45 million spent on Workday represents just 0.36 percent of the total funds, while more than 96 percent has been allocated to programs that have provided direct relief for Iowans.
- More than$76 million to support Iowa families
- More than $126 million to support small businesses and non-profits
- More than $110 million to support Iowa farmers and producers
- $125 million to support Iowa communities
- Nearly $112 million to support Iowa health care providers
- $490 million for the Unemployment Trust Fund, creating tax relief for 40,766 employers
- $35 million for Broadband Expansion Grants
- $127 million for COVID-19 operations
The State will allocate the remaining $47.3 million by the December 30 deadline, but an extension from the federal government would allow time to use the funds to create additional programs and support other needs among Iowans. Reynolds strongly encourages Congress to work together and make additional support possible for American families, workers, and businesses before the end of the year.