State Agency Paid Staffing Firm $78.5 Million for Contractors’ Standby Time

In a report ordered by a 2024 resolution from the Legislative Audit Commission and released on August 11, 2026, the office of Illinois Auditor General Christopher Meister found that the Illinois Emergency Management Agency-Office of Homeland Security (IEMA-OHS) was poorly managed and monitored its use of contractors during fiscal years 2022 and 2023. The biggest issue was a $78.5 million payment by IEMA-OHS, an agency under the purview of Governor JB Pritzker, to Favorite Healthcare Staffing, a national employment agency based in Kansas.

IEMA-OHS paid Favorite Staffing $78.5 million for contractors’ standby time rather than hours actively worked, a billing practice known as “standdown,” in which contractors are compensated even when they are not working. The report found that Favorite Staffing billed the state $220.3 million during the audit period, with the standdown billings alone accounting for 469,892 hours.

IEMA-OHS has helped coordinate the state’s response to major emergencies, including the COVID-19 pandemic and the influx of migrants to the Chicago area in 2023. Favorite Staffing also assisted Chicago with the migrant response and received hundreds of millions of dollars to operate city migrant shelters. A 2023 Chicago Tribune investigation raised questions about some of those costs, finding that Favorite Staffing charged premium rates and overtime, with hundreds of employees recording workweeks of 84 hours or more during the first half of 2023.

Among the report’s other findings, IEMA-OHS paid a contractor $435,000 to temporarily fill in as executive assistant to the agency’s director, which was more than the salary of then-director Alicia Tate-Nadeau. IEMA-OHS was also estimated to have paid a contractor more than $1.4 million for housing costs on days when staff stayed in personal residences rather than hotels.

The report faulted IEMA-OHS for failing to have adequate resources in place to review the accuracy of billable-hour invoices. The agency used two billable-hour contractors to review the invoices. Because the first “had its own deficiencies in billings submitted,” IEMA-OHS contracted with a second firm at a cost of $1.25 million. The report also found that IEMA-OHS “did not ensure vendors provided adequate support for invoice billings prior to approving payment for those invoices” and that the agency did not provide vendors “with standardized requirements for contractor timesheets.”

The report also found that IEMA-OHS lacked a system to approve or monitor contractor overtime. One contractor was allowed to charge overtime and billed the state $88.4 million for extra hours. Another contractor was not allowed to charge overtime, but its employees worked 644,653 hours beyond the agency’s established workweek requirements. IEMA-OHS had no approval process to prevent or catch these extra hours.

Meister’s office issued a number of recommendations, including determining how many contractors it actually needs, establishing clearer rules for when to use contractors rather than state employees, requiring contractors to provide detailed descriptions of the work they completed, and reviewing contractor invoices before payment to ensure the charges are accurate.

IEMA-OHS generally agreed with the recommendations, including improving staffing decisions and limiting payments for hours not worked. However, the agency explained that during emergencies, it is common to pay emergency workers to remain available and ready to respond, even when they are not actively working. IEMA-OHS stated that the COVID-19 pandemic required an “unprecedented response by the State and its agencies,” but said it takes the audit seriously and is “amending and adopting policies relative to the use of billable hour contractors to ensure that all services provided continue to be in the best interests of the Agency and the State of Illinois.”

If you have questions about the Illinois Auditor General’s report, the Illinois Emergency Management Agency-Office of Homeland Security’s practices, or their implications, contact the qualified attorneys at Rock Fusco & Connelly, LLC