State Auditor Mike Foley is calling for benefits reform in Nebraska’s largest county.
In a letter to the Douglas County Board of Commissioners Tuesday morning, Foley’s office identified multiple issues with the county’s Department of General Assistance that “merit corrective action.”
Douglas County provided more than $8.6 million in assistance to low-income residents between 2023 and 2025, spending almost $7 million on administrative costs for the program in the same period.
“Such a high administrative burden relative to the benefits disbursed is troubling and raises questions as to whether a more efficient system can be found,” Foley wrote in a Tuesday morning press release.
Specific issues identified include oversight over the use of Dollar General gift cards issued by the county as vouchers for clothing, personal hygiene products and cleaning supplies. County staff purchased almost 26,000 such cards between 2023 and 2025, according to state auditors.
“Despite the significant amount of gift cards purchased, the Department performed no procedures to ensure that clients were using the gift cards only for allowable purchases, or previously issued gift cards had been fully used prior to issuing additional gift cards,” auditors wrote.
In a test of 100 such gift cards, auditors found more than 70% of the funds were misused or potentially misused — almost 40% for “Food, Toys, Pet Food, and Other Improper Items,” just under 12% of the funds lacked documentation from either county staff or Dollar General, and almost 11% were used to purchase cigarettes and alcohol. Roughly 3% of the funds were redeemed on the “OpenBucks” platform, which translates retail gift cards into e-commerce funds.
In a response attached to the letter, county staff agreed that the purchase of tobacco and alcohol did not match the intent of the assistance program and wrote that they would consult with the Board of Commissioners on reviewing transactions and clarifying the programs
“Dollar General did not sell tobacco or alcohol when the Department originally established the gift card program, making it an appropriate vehicle for assistance at the time,” the response states. “Once the vendor began carrying these items, the Department pursued point-of-sale purchase restrictions with Dollar General over several years without success, and separately explored Walmart gift cards, which could not accommodate the Department’s required card volume.”
State auditors also highlighted “significant discrepancies” in a sample of applications for general assistance. They specifically looked at 16 cases, “that appeared to be at higher risk for receipt of improper benefits,” and found more than $14,000 in overpaid benefits.
“From the sample applications reviewed, a high percentage simply did not meet the written eligibility thresholds of the program while other applications either did not fully disclose other sources of income available to the applicant or provided false information,” the letter states.
Auditors extrapolated the sample out to suggest up to 70% of benefits disbursed by the program could be at risk for abuse, though they noted that the number may be higher than expected because the sample deliberately included more “higher risk case files.”
In their response, county staff accepted responsibility for the eligibility issues, though they noted that many systemic concerns had already been identified and fixed before state auditors completed their work.
“The Department views this as an indication that its internal oversight mechanisms are functioning as intended, while also recognizing that these mechanisms need continued strengthening to catch issues earlier and more consistently,” county staff wrote.
The Douglas County Board of Commissioners is scheduled to meet Tuesday night, though the Department of General Assistance is not on the meeting agenda.