Audit says checks to parents should’ve been automatic, but it’s not too late to get one
The state’s Extra Credit grant program doled out $335 checks to more than a million North Carolina parents in 2020, using federal coronavirus relief funds.
But some parents who didn’t qualify through their tax status had to apply for the money, and a new report from the state auditor shows that a process should have been in place to send them out automatically as well.
For parents who qualify to apply and haven’t yet, it’s not too late. Through a new law this year, the application deadline was extended to May 31.
State Auditor Beth Wood’s report released Thursday shows that a potentially “significant” number of lower-income families did not receive the grants, finding that “families most in need did not receive economic assistance for virtual schooling and child-care costs during the COVID-19 pandemic.”
The audit gave the reason as the additional steps the Department of Revenue had to take to award them via applications. The department could not provide auditors with the number of eligible parents who did not receive the checks, but the audit found that of the 25,000 total payments to applicants, just 9,000 of them applied by the original deadline of Oct. 15. After a lawsuit by the Charlotte Center for Legal Advocacy, the deadline was extended to Dec. 7.
The audit also backed up the idea behind the checks: “Due to the COVID-19 pandemic, North Carolina public schools moved in large part to virtual schooling. This transition created child care difficulties for families. Without in-person schooling, some parents may not have been able to maintain employment or were forced to work less hours in order to care for their children. Further, virtual schooling required computers and internet access, the cost of which may have reduced a family’s resources.”
“Receiving assistance from the Program would have helped these families,” the audit found.
What are Extra Credit grants?
Just a few weeks into the start of the 2020 school year, the Republican-led General Assembly passed a bill, signed into law by Democratic Gov. Roy Cooper, that allocated $441 million of North Carolina’s $3.6 billion federal Coronavirus Aid, Relief, and Economic Security Act (CARES Act) money to parents.
It came in the form of $335 Extra Credit grants that were mailed out automatically to taxpayers who claimed a child tax credit on their state income tax form for the previous year. Some parents who made too much money did not get the checks. And some parents who did not make enough income to file taxes were eligible for the grants, but they had to apply.
The purpose of the grants was to help parents offset costs from what became for some of them a year of remote-only education.
By the December deadline, there was leftover money because not everyone applied who was eligible, leaving an extra $62 million in the program distributed by the Department of Revenue.
State Sen. Brent Jackson, the Sampson County Republican who chairs the powerful Senate Appropriations Committee, said then that extending the application deadline would be a priority of the start of this year’s legislative session. He was the lead sponsor on a bill to extend the application deadline, which Cooper signed as another COVID-19 relief bill in February.
The audit does not include that new legislation. It does say that as of Dec. 31, 2020, the Department of Revenue had sent out $366 million to 1.1 million families automatically, along with another $8.2 million to the 25,000 families who had applied. The audit spans from Sept. 4 through Dec. 31, 2020.
The state audit shows that rather than making parents apply, the program should have automatically sent the money to parents and reached them through a different source than their taxes.
The audit lays out the short timeline for the payments and steps needed for those to apply:
“Since state law required payments to be made to low-income families through an application process, the Department [of Revenue] needed to take additional steps in order for low-income families to apply for and receive payment,” the audit states, including creating the application, providing outreach and processing the applications within six weeks of the original deadline. The department told auditors they found the time frame “challenging.”
The audit recommends that future programs use more ways to find eligible low-income people so they can send payments automatically by, for example, accessing people through their Medicaid, Supplemental Nutrition Assistance Program and Temporary Assistance for Needy Families enrollment.
How to get the grant
If you are a parent who qualifies for the grant but has not received it yet, you can find out more information at ncdor.gov/extracredit. The application deadline is May 31.
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This story was originally published April 29, 2021 at 5:29 PM with the headline "Audit says checks to parents should’ve been automatic, but it’s not too late to get one."