The Connecticut Office of the State Treasurer overpaid retroactive cost of living adjustment (COLA) payments to 29 employees in July 2022, according to a recent report from state auditors.
The audit, which covered fiscal years 2023 and 2024, found a total of $12,685 overpayments, ranging from $148 to $757, and one underpayment of $385.
Three other employees were underpaid a total of $1,106 from separate retroactive payments.
The mismanaged payments followed a June 2022 memo from the Office of the State Comptroller detailing COLA and annual increment adjustments between January 1, 2022, and May 19, 2022. State agency officials were directed to calculate and pay employees those retroactive adjustments using a “mix of current and previous pay rates” for 23 pay periods.
Auditors reviewed all $287,545 in retroactive payments made by the treasurer’s office to 112 employees. They found the overpayments were due to a lack of managerial oversight.
The treasurer’s office agreed with the auditors’ findings but stated it was unlikely to happen again.
“Due to the complexity of the overlapping retroactive calculations, the Business Office inadvertently included some prior period adjustments. This was a unique situation that is unlikely to reoccur, with two overlapping pay adjustments being implemented at two different times.” the treasurer’s office said in response to auditors’ findings.
They also said the Business Office would continue “double verification of all retroactive payment adjustments” and seek the comptroller’s office input on overlapping payments or split pay periods. They will also try to recoup the funds that were overpaid.
Additionally, auditors found the treasurer’s office omitted costs related to the development of a new debt management software in 2024. The treasurer’s office paid a vendor just under $431,000 to develop the software alongside its staff. As a result of the omission, auditors found the treasurer’s office understated their annual asset reporting for fiscal year 2024.
The audit also found the treasurer’s office had corrected findings from its previous audit, including by improving controls over the asset disposal process and improving internal controls to ensure it complied with state ethics and confidentiality agreement requirements.
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