Louisiana inspector general asks Treasury to tighten payments on $113.5 million in nonprofit line items
Gov. Jeff Landry and Inspector General Angele Davis released ten recommendations on Oct. 21, including payment by reimbursement, a 25 percent cap on advances and vendor screening, for 272 nongovernmental organizations funded in this year's budget acts.
Nonprofit line items in Louisiana's Acts 3 and 961 of 2026, and the share Treasury pays
Baton Rouge. Louisiana's inspector general has asked the state treasurer to change how the state pays nonprofits that receive line items in the budget, after a review found weak points in advances, financial oversight, vendor checks and performance reporting.
Gov. Jeff Landry and State Inspector General Angele Davis announced the review on Oct. 21. It covers Acts 3 and 961 of the 2026 Regular Session, which provide $113.5 million for 272 nongovernmental organizations. The Louisiana Department of the Treasury pays about $107.2 million of that, or 94 percent, according to Ms. Davis's letter to State Treasurer John Fleming.
What the letter recommends
The letter makes ten recommendations. Recipients would be paid by reimbursement, with an advance allowed only after a documented liquidity test and written approval by the commissioner of administration, and capped at 25 percent of the appropriation. Every vendor and subcontractor would have to be named before an agreement is signed, and the state would check each recipient against the Legislative Auditor's list of noncompliant entities and a do-not-pay screen before every payment.
Other terms cap administrative costs at 10 percent of modified total direct costs, require a dedicated bank account with two signers or board approval for each payment, and hold the next payment when a report is more than 30 days late. Commissioner of Administration Taylor F. Barras approved a revised agreement template with these terms on Oct. 21, so they will also apply to line items other agencies administer. None of the recommendations requires legislation, the letter says.
The cases behind it
The letter cites four cases. Treasury advanced $400,000 of an $800,000 appropriation to the National Association for African American Economic Development in March 2024; the Legislative Auditor found that $205,123 moved out of its dedicated account within six months and that no progress or cost report was filed. Treasury's referral that August stopped the second payment.
At Divine Kingdom Ministries, Treasury flagged the first cost report after a $37,500 advance on a $75,000 appropriation. The investigation that followed, with help from the Louisiana Bureau of Investigation, led to the director's arrest on Sept. 22 on felony theft and false public records charges. The charges remain allegations until proven in court. Two other recipients are not named.
Ms. Davis asked Treasury to apply the payment and vendor rules now to every agreement under the two acts not yet signed and to remaining payments on those already signed, and to send her office monthly agreement and payment data through June 30, 2027. The governor's release did not include a response from Mr. Fleming.
About this story
501c3.help wrote this story from the sources listed with it, not from material an organization sent. Our editors approved it on Oct. 22, 2026. Stories in The Nonprofit Herald are free, and nothing is asked in return. Editorial rules.
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