Audit Reveals Fiscal Oversight Concerns in Nourish New York Program

In a recent audit conducted by New York State Comptroller Thomas P. DiNapoli, fiscal management issues within the Nourish New York program (Nourish NY) have come to light. This program, designed to combat food insecurity and support local farmers by connecting food banks with New York-grown products, faces challenges that may hinder its overarching mission. The audit findings underscore the importance of responsible fiscal management in government programs. Ensuring transparency, accountability, and clear guidelines are crucial to achieving the goals of programs like Nourish NY.

"The Nourish New York Program is vital and addresses significant needs in both rural and urban communities to combat food insecurity," said DiNapoli. "The state's Department of Health and Department of Agriculture and Markets (Ag & Mkts) need to provide stronger oversight to help the program reach its full potential. Greater and clearer guidance to food relief organizations will enable them to get the funds needed to buy New York-made farm products and should help increase the number of participating farms."

Nourish NY, jointly managed by the New York State Department of Health (DOH) and the New York State Department of Agriculture and Markets, was initially launched in response to disruptions in the food supply chain caused by the pandemic. Later, it gained permanency through state law and received substantial funding of $147 million through March 2023.

One of the major concerns highlighted by the audit is the documentation of food purchases made under the program. DiNapoli's findings revealed that DOH approved $22.7 million in purchases from May 2020 through March 2022 despite inadequate documentation to confirm that the food products were grown in New York, a requirement mandated by Nourish NY. Auditors noted that this discrepancy often occurred because local food providers submitted lump sum expenses to regional food banks without providing a detailed breakdown of purchased products. Importantly, such a breakdown was not mandated by DOH.

Furthermore, the audit pointed to challenges in verifying the sources of farm products purchased, a responsibility assigned to Ag & Mkts. A review of 165 food purchases, totaling nearly $1 million from distributors, revealed that neither the agency nor the food relief organizations could provide the necessary documentation to verify the source of the products.

A crucial financial discovery in the audit involves the need for accompanying documentation for a substantial number of purchases, totaling $7,160,507, from 42 vendors. Shockingly, 29% of these purchases, amounting to $970,667, needed more essential documentation to validate the source of the purchased food.

Another area of concern revolved around administrative expenses. DOH's limited guidance on what administrative costs could be covered led to the approval of over $8.9 million in administrative reimbursements without sufficient documentation. This deficiency in oversight raised questions about the potential misuse of funds for expenses unrelated to Nourish NY.

Additionally, the audit highlighted that DOH applied Hunger Prevention and Nutrition Assistance Program (HPNAP) standards to Nourish NY. The application of these stringent nutritional standards left food relief organizations needing help to purchase certain foods commonly produced in New York, including honey, maple syrup, and whole milk. DOH's decision to combine funds for food assistance programs and its failure to provide adequate guidance on these standards to food relief organizations led to some local farms being unable to participate in the program. Importantly, the audit emphasized that under the law, Nourish NY does not restrict purchases based on whether products meet specific nutritional standards.

The audit revealed regional disparities in vendor participation, indicating potential inefficiencies in program outreach and implementation. The North County had the fewest participants in the program, with only 16 vendors, while other regions, such as the Capital Region, had the most participants with 102. The audit noted that Ag & Mkts officials identified measures to encourage farmer participation in the program to address these disparities.

In response to the audit's findings and recommendations, DOH and Ag&Mkts generally agreed to work toward improving Nourish NY and enhancing their collaboration to support the program's mission better. The audit report revealed that the program has already facilitated the purchase of over 94 million pounds of New York products and supported 4,333 farms and agricultural businesses across the state.
Comptroller DiNapoli's audit highlights the importance of responsible fiscal management in government programs. Ensuring transparency, accountability, and clear guidelines are crucial to achieving the goals of programs like Nourish NY. As discussions continue on how to address food insecurity best and support local farmers, these findings serve as a reminder of the need for efficient and effective government initiatives.

"The Nourish New York Program is vital and addresses significant needs in both rural and urban communities to combat food insecurity," said DiNapoli. "The state's Department of Health and Department of Agriculture and Markets need to provide stronger oversight to help the program reach its full potential. Greater and clearer guidance to food relief organizations will enable them to get the funds needed to buy New York-made farm products and should help increase the number of participating farms."