The Virginian-Pilot
                             THE VIRGINIAN-PILOT 
              Copyright (c) 1996, Landmark Communications, Inc.

DATE: Sunday, September 1, 1996             TAG: 9609010116
SECTION: LOCAL                   PAGE: B4   EDITION: FINAL 
SOURCE: ASSOCIATED PRESS 
DATELINE: RICHMOND                          LENGTH:   42 lines

BOOKKEEPING PROBLEMS THREATEN STATE PARK GRANTS

The agency responsible for overseeing state parks could cost Virginia millions of dollars in federal grants because it has trouble keeping track of the taxpayer dollars it spends, auditors say.

Walter J. Kucharski, the state auditor of public accounts, said financial management at the Department of Conservation and Recreation is the worst in Virginia but does not involve fraud.

``I don't know anybody else who has been this bad for this long,'' he said.

``A lack of leadership and technical competence is the cause of numerous internal (financial) control weaknesses,'' said the latest report from Kucharski's office, which covers the fiscal year ending June 30, 1995.

The conservation department has a $23 million general-fund budget, and gets millions more from grants, park fees and other sources.

The department oversees 26 state parks, some anti-pollution programs, dam safety and a program to protect rare species.

The agency received $5.1 million in federal grants in 1994-95.

Under federal law, the agency must track the grants closely to ensure the money is spent the way the grants require. Because of the agency's poor performance in tracking funds, the department could lose future grants or be forced to return some of the money it already has received, the report said.

The report also concluded that the department does not adequately control its petty cash fund; does not ensure that payments from private contractors are correct; and does not have adequate controls to keep it from making duplicate payments to vendors contracted to provide park services.

Kathleen W. Lawrence, who took over as the department's director May 6, said she is creating a new financial office to end the problems. ILLUSTRATION: ABOUT THE AGENCY

The conservation department has a $23 million general-fund

budget, and gets millions more from grants, park fees and other

sources.

It oversees 26 state parks, some anti-pollution programs, dam

safety and a program to protect rare species. by CNB