Arkansas Health Department Director Explains Grant Loss

The director of the Arkansas Health Department said on Monday that the state missed out an a $725,760 grant to help AIDS patients because officials misunderstood federal grant law. The grant would have provided backup funding for medicines provided by pharmaceutical companies to about 100 patients in a state program. Dr. Fay Boozman said the companies could stop providing the medicines because of the declining economy.

The controversy began when the Health Department filed away a July 20 letter from federal authorities notifying the state that its grant application had been denied and setting a July 29 deadline for a state response. But that deadline came and went without key state employees knowing that the letter had arrived. The letter's handling led to questions about whether the department was being run competently. There have also been accusations that federal officials applied federal rules unfairly, denying Arkansas' application while approving grants from other states in similar situations. Boozman, however, said this was not the case: "They did it uniformly." Arkansas was one of three states whose applications were not approved.

To compensate for the missed money, Arkansas will use about $250,000 this fiscal year and a comparable amount next fiscal year, with the money coming from Gov. Mike Huckabee's portion of the state General Improvement Fund legislation. The Legislature also recommended $100,000 from its portion of that fund for the AIDS program, but whether revenue will be available for the allocation is uncertain, Boozman said. The missed money has caused disputes between legislators and the Huckabee administration.

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