(The Center Square) — Louisiana’s inspector general is calling for tighter restrictions on $113.5 million in taxpayer funding earmarked for nonprofit organizations after a review uncovered questionable payments, inadequate financial reporting and other oversight failures.

In a letter to state Treasurer John Fleming, Inspector General Angele Davis outlined 10 recommendations intended to prevent fraud, waste and abuse involving appropriations to 272 nongovernmental organizations approved by lawmakers this year.

The recommendations include restricting advance payments, screening nonprofit organizations and their contractors, limiting administrative expenses and withholding payments from organizations that fail to document how taxpayer dollars are spent.

The review examined four cases involving nonprofit appropriations from previous fiscal years, including one that resulted in a criminal arrest last month.

In March 2024, the Treasury advanced $400,000 to the National Association for African American Economic Development, half of its $800,000 appropriation. The Louisiana Legislative Auditor’s Office subsequently found that $205,123 had been transferred out of the organization’s dedicated account within six months, while required progress and cost reports had not been submitted.

The Treasury referred the matter for further review, preventing the remaining $400,000 from being disbursed.

Another case involved Divine Kingdom Ministries, which received a $37,500 advance against a $75,000 appropriation. After Treasury officials identified concerns with the organization’s cost report, the case was referred to the inspector general.

The investigation resulted in the organization’s director being arrested Sept. 22 on allegations of felony theft and false public records charges.

A third case involved an unnamed organization that received a $50,000 advance in February 2026. Investigators found that its cost report failed to identify vendors and that $13,000 of the $46,615.88 in claimed expenditures went to connected parties.

In another case, a $250,000 agreement from fiscal year 2025 listed two subcontractors responsible for 90% of the funding as “To be determined.”

The organization had been registered only five months before the agreement began, with one individual serving as its sole board member, president and authorized signer. The agreement also included a $25,000 administrative fee and authorized a 50% advance based on a one-sentence justification.

“Each defect was on the face of the file before the agreement was signed,” Davis wrote.

The review also identified three recipients of 2026 appropriations appearing on the Legislative Auditor’s Sept. 30 noncompliance list: the Louisiana Sports Hall of Fame Foundation, allocated $100,000; Thrive New Orleans, allocated $51,500; and Broad Community Connections, allocated $50,000.

State law generally prohibits disbursing appropriated funds to organizations that fail to meet Legislative Auditor reporting requirements unless an extension has been granted.

Under Davis’ recommendations, nonprofit organizations would generally receive reimbursements for documented expenditures rather than advance payments. Exceptions would require demonstrated financial need and written approval from Commissioner of Administration Taylor Barras, with advances capped at 25%.

The recommendations also include a 10% cap on certain administrative expenses and additional scrutiny of organizations controlled by a single individual or established shortly before receiving an appropriation.

Barras approved a revised agreement template incorporating the recommendations Wednesday, but implementation by the Treasury remains a separate step. Davis is requesting immediate changes to agreements not yet executed and remaining payments under existing agreements.

None of the proposed changes requires legislative approval, according to Davis.

The $113.5 million represents funding authorized by lawmakers, not money already spent. The review does not establish how much of the current year’s appropriations has been disbursed.