U.S. ELECTION ASSISTANCE 

COMMISSION 

OFFICE OF INSPECTOR GENERAL

FINAL REPORT: 

REVIEW OF THE ADMINISTRATION OF 

PAYMENTS RECEIVED UNDER THE 

HELP AMERICA VOTE ACT BY THE 

GEORGIA SECRETARY OF STATE

Report No. 

E-HP-GA-05-06 

July 2006
U.S. ELECTION ASSISTANCE COMMISSION

OFFICE OF INSPECTOR GENERAL

1225 New York Ave. NW - Suite 1100 

Washington, DC 20005

July 12, 2006 

Memorandum 

To: Thomas Wilkey 

 Executive Director 

From: Roger La Rouche 

 Acting Inspector General 

Subject: Final Report on Review of the Administration of Payments Received Under 

the Help America Vote Act by the Georgia Secretary of State (Assignment 

No. E-HP-GA-05-06) 

 This report presents the results of the subject review. The objective of the review 

was to determine whether Georgia (1) managed Help America Vote Act (HAVA) funds 

in accordance with the Uniform Administrative Requirements for Grants and Cooperative 

Agreements with State and Local Governments and with the Cost Principles for State, 

Local, and Indian Tribal Governments and (2) complied with HAVA requirements for 

maintaining the election fund and sustaining the State’s level of expenditures for 

elections. 

 The report concluded that Georgia administered the HAVA funds in accordance 

with the Administrative Requirements and the Cost Principles and that Georgia complied 

with the HAVA requirement for maintaining the State’s level of expenditures for 

elections. However, Georgia did not fully comply with the requirement for the 

establishment of an election fund in that it established the fund in a commercial bank 

instead of the State Treasury. In a June 1, 2006 response to the draft report (Attachment 

1), the Georgia Secretary of State concurred with the report’s conclusions. In its reply 

(Attachment 2), the U.S. Election Assistance Commission (EAC) said that since the 

State had expended most of its HAVA funds and spent in excess of its matching 

requirement that it was not now necessary for Georgia to set up an election fund in the 

State Treasury. The EAC also replied that if Georgia receives additional HAVA funds, 

Georgia should be prepared to set up an election fund in the State Treasury. 

 Since the report does not contain any recommendations, no further response to the 

Office of Inspector General is required. The legislation, as amended, creating the Office 

of Inspector General requires that we report to Congress semiannually on all audit reports 

issued, actions taken to implement our recommendations, and recommendations that have 

not been implemented. Therefore, this report will be included in our next semiannual 

report. 

 If you have any questions about this matter, please call me at (202) 566-

3100. 

 
1 

BACKGROUND

 

HELP AMERICA 

VOTE ACT

The Help America Vote Act of 2002 (HAVA) created the U.S. 

Election Assistance Commission (EAC or Commission) to assist states 

and insular areas1

 with the administration of Federal elections and to 

provide funds to states to help implement these improvements. HAVA 

authorizes payments to states under Titles I and II, as follows: 

9 Title I, Section 101 payments are for activities such as 

complying with HAVA requirements for uniform and 

nondiscriminatory election technology and administration 

requirements (Title III), improving the administration of 

elections for Federal office, educating voters, training election 

officials and poll workers, and developing a state plan for 

requirements payments authorized by Title II. 

9 Title I, Section 102 payments are available only for the 

replacement of punchcard and lever action voting systems. 

9 Title II, Section 251 requirements payments are for complying 

with Title III requirements for voting system standards; and for 

addressing provisional voting, voting information, statewide 

voter registration lists, and voters who register by mail. 

Title II also requires that states must: 

9 Have appropriated funds “equal to 5 percent of the total amount 

to be spent for such activities [activities for which requirements 

payments are made].” (Section 253(b)(5)). 

9 “Maintain the expenditures of the State for activities funded by 

the [requirements] payment at a level that is not less than the 

level of such expenditures maintained by the State for the fiscal 

year ending prior to November 2000.” (Section 254 (a)(7)). 

9 Establish an election fund for amounts appropriated by the state 

for “for carrying out the activities for which the requirements 

payment is made,” for the Federal requirements payments 

received, for “such other amounts as may be appropriated under 

law,” and for “interest earned on deposits of the fund.” (Section 

254 (b)(1)). 

 

1

 The Commonwealth of Puerto Rico, American Samoa, Guam, and the United States Virgin Islands. 
2 

FUNDING FOR 

GEORGIA

FINANCIAL 

MANAGEMENT 

REQUIREMENTS

HAVA funds received and expended by Georgia are as follows: 

TYPE OF AMOUNT EXPENDITURES 

PAYMENT RECEIVED AMOUNT AS OF 

 

101 $7,816,328 $1,936,398 12/31/05 

102 $4,740,448 $4,740,448 12/31/032

251 $64,748,170 $56,885,208 12/31/05 

 

Totals $77,304,946 $63,562,054 

In Georgia, HAVA payments are administered by the Secretary of 

State (SOS). To account for the payments, HAVA requires states to 

maintain records that are consistent with sound accounting principles, 

fully disclose the amount and disposition of the payments, identify 

project costs financed with the payments and with other sources, and 

will facilitate an effective audit. 

In addition, the Commission notified states of other management 

requirements. Specifically, that states must: 

9 Comply with the Uniform Administrative Requirements for 

Grants and Cooperative Agreements with State and Local 

Governments (also known as the “Common Rule” and 

published in 41CFR105-71). 

9 Expend payments in accordance with cost principles for 

establishing the allowability or unallowability of certain items 

of cost for federal participation issued by the Office of 

Management and Budget in Circular A-87. 

9 Follow the requirements of the Cash Management and 

Improvement Act. 

9 Submit annual financial reports on the use of Title I and Title II 

payments. 

OBJECTIVE The objective of our review was to determine whether Georgia (1) 

managed Help America Vote Act (HAVA) funds in accordance with 

the Uniform Administrative Requirements for Grants and Cooperative 

Agreements with State and Local Governments (the Common Rule) 

and the Cost Principles for State, Local, and Indian Tribal 

 2

 Georgia reported that it expended all its Section 102 funds in 2003 and, therefore, did not report any 

additional expenditure of Section 102 funds in 2004 or 2005. 
3 

Governments (Office of Management and Budget Circular A-87) and 

(2) complied with HAVA requirements for maintaining the election 

fund and sustaining the State’s level of expenditures for elections. 

The part of the audit that covered expenditures focused on: 

9 Accumulating the financial information reported to the EAC on 

Standard Forms 269. 

9 Accounting for salaries. 

9 Purchasing goods and services. 

9 Accounting for property. 

9 Accounting for matching costs. 

9 Spending by counties. 

9 Charging indirect costs. 

RESULTS OF REVIEW

SUMMARY We found that Georgia administered its HAVA funds in accordance 

the Common Rule and OMB Circular A-87.3 We also found that 

Georgia complied with the HAVA requirement for maintaining the 

State’s level of expenditures for elections but did not fully comply with 

the requirement for the establishment of an election fund. 

ELECTION FUND Sections 254(a)(5) and (b)(1) of HAVA require a state to establish an 

election fund in the treasury of the state government which consists of 

state appropriations for HAVA activities, the requirements payments, 

and interest for carrying out the activities for which the requirements 

payment are made to the State. In regard to state appropriations, 

Section 253 (a) requires a state to certify, among other things, that it 

has appropriated 5 percent of the total amount to be spent for activities 

authorized for the use of requirements payments. 

While Georgia established an election fund for the deposit of HAVA 

payments and related interest, the account was not established in the 

state treasury and did not include Georgia’s appropriation of its 5 

percent matching contribution. Georgia’s fiscal year 2003 

appropriation for the Secretary of State included an approximate $3.4 

million increase “to expand the Georgia voter education program, 

including 13 positions, in preparation for the statewide uniform 

electronic voting system authorized by SB [Senate Bill] 213.” Office 

of Secretary of State officials told us that the $3.4 million increase was 

Georgia’s matching contribution. However, the $3.4 was not deposited 

 

3

 Georgia did not use HAVA funds from EAC for indirect costs or for subgrants to counties. 
4 

into the election fund. 

During our review, we found that in fiscal years 2003, 2004, and 2005, 

the Secretary of State reported that it spent approximately $6 million in 

state matching funds for statewide uniform voting and education. This 

amount exceeds its $3.4 million matching requirement by about $2.6 

million and more than offsets any interest lost as a result of not 

depositing its $3.4 million match in the election fund. 

Regarding the amount of HAVA funds and interest still available for 

expenditure, we found that the March 31, 2006 balance of unobligated 

funds was approximately $960,000. 

We discussed this situation with the Executive Director of the 

Commission and asked whether the Commission wanted Georgia to set 

up an Election Fund in the state treasury, as required by HAVA. The 

Executive Director told us that given that the State had expended most 

of the HAVA funds and spent in excess of its matching requirement 

that he did not believe that it was now necessary for Georgia to set up 

an election fund in the state treasury. Accordingly, we make no 

recommendation regarding this matter. 

 

 
5 

APPENDIX 

SCOPE AND METHODOLOGY 

To accomplish our objective, we reviewed 

9 The prior single audit report and other reviews related to the 

Secretary of State’s financial management systems and the HAVA 

program for the last 3 years. 

9 Policies, procedures and regulations for Georgia’s management and 

accounting systems as they relate to the administration of HAVA 

programs. 

9 The State Plan required by HAVA and an organizational chart of 

the SOS. 

9 Inventory lists of all equipment purchased with HAVA funds. 

9 Major purchases. 

9 Supporting documents maintained in the accounting system for 

payments made with HAVA funds. 

9 Appropriations and expenditure reports for State funds used to 

maintain the level of expenses for elections at least equal to the 

amount expended in fiscal year 2000 and to meet the five percent 

matching requirement for section 251 requirements payments. 

9 Information regarding source/supporting documents kept for 

maintenance of effort and matching contributions. 

We also interviewed appropriate Georgia employees about the 

organization and operation of the HAVA program. 

We conducted our review in accordance with Government Auditing 

Standards issued by the Comptroller General of the United States. As 

such, we included tests and procedures as considered necessary under 

the circumstances to determine whether the Secretary of State 

administered HAVA payments in accordance with applicable 

requirements. Because of inherent limitations, a study and evaluation 

made for the limited purposes of our review would not necessarily 

disclose all weaknesses in administering HAVA payments.


OIG’s Mission 

The OIG audit mission is to provide timely, high-quality 

professional products and services that are useful to OIG’s clients. 

OIG seeks to provide value through its work, which is designed to 

enhance the economy, efficiency, and effectiveness in EAC in a 

way that they work better and cost less in the context of today's 

declining resources. OIG also seeks to detect and prevent fraud, 

waste, abuse, and mismanagement in these programs and 

operations. Products and services include traditional financial and 

performance audits, contract and grant audits, information systems 

audits, and evaluations. 

Obtaining 

Copies of 

OIG Reports 

Copies of OIG reports can be requested by e-mail. 

(eacoig@eac.gov). 

Mail orders should be sent to: 

U.S. Election Assistance Commission 

Office of Inspector General 

1225 New York Ave. NW - Suite 1100 

Washington, DC 20005 

To order by phone: Voice: (202) 566-3100 

 Fax: (202) 566-3127 

To Report Fraud, 

Waste and Abuse 

Involving the U.S. 

Election Assistance 

Commission or Help 

America Vote Act 

Funds

By Mail: U.S. Election Assistance Commission 

 Office of Inspector General 

 1225 New York Ave. NW - Suite 1100 

 Washington, DC 20005 

E-mail: eacoig@eac.gov