The Illinois Department of Transportation informed the Shelby County Board on Oct. 9 that it would not approve the county’s state fiscal year 2026 transit operating grant applications — including DOAP and Section 5311 requests — until the county clears delinquent audits and outstanding compliance findings.

David Schafer, bureau chief of transit operations at the Illinois Department of Transportation, told the board in a written notice read at the meeting that Shelby County’s fiscal year 2023 and 2024 audits remained delinquent and that a number of state compliance findings from a 2024 review remained unresolved. IDOT designated Shelby County a “high risk” grantee and said it would require 100% of source documentation for each requisition while the designation remains in place.

The notice and conditions
Schafer’s letter said IDOT would not approve the county’s FY2026 DOAP and 5311 applications unless Shelby County’s transit partner completed the transit portion of the FY2023 audit and signed required audit representation/exhibit forms (ASREs). The letter cited failure to submit timely budget summaries and quarterly reports for FY2025 and noted that a total of 20 compliance findings from the 2024 5311 review remained unresolved. IDOT referenced the grant agreements and stated that source documentation — canceled checks, bank statements, invoices, time and attendance records, subrecipient documentation and other supporting records — must be submitted to support requisitions (the letter cited relevant exhibit language from the FY2026 agreements).

County response and subsequent status
Board members said county staff contacted the auditor Sikich and coordinated with their transit partner after Schafer’s notice. Meeting materials and follow-up emails show the county submitted draft audit materials to IDOT; as of the board meeting staff reported that draft materials had been delivered and IDOT would review them. Schafer replied that his office would review the drafts and upload them into IDOT’s FY2026 applications if the county’s partners had no additional concerns, but he cautioned that no requisitions for FY2026 funding would be approved until the documents were finalized and signed.

Why it matters: Transit funding and compliance
The IDOT notice places immediate compliance and documentation burdens on the county’s transit program and may slow the county’s ability to draw down operating funds until the audits and outstanding findings are formally resolved. The requirement for 100% source documentation increases administrative workload for requisitions and may delay payments to transit operators until IDOT lifts the high-risk designation.

Next steps
County staff said they will present the audit materials to the board next month for formal approval and that they are working with Sikich and the county’s transit partner to resolve outstanding findings. IDOT indicated it would reevaluate the county’s risk status when FY2027 applications are submitted if audit and reporting issues are resolved.

Ending: Board members asked staff to accelerate completion of outstanding audit items and to present finalized documents for the board’s approval next month.