Audit 11849

Federal Agency: U.S. Department of Agriculture Federal Program Name: Supplemental Nutrition Assistance Program Cluster Assistance Listing Number: 10.561 Federal Award Identification Number and Year: 222MN101S2514 – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Number: H55210010 Award Period: 2022 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Agencies are required to automate their SNAP operations and computerize their systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP (7 CFR sections 272.10 and 277.18). This includes: (1) processing and storing all case file information necessary for eligibility determination and benefit calculation, identifying specific elements that affect eligibility, and notifying the certification unit of cases requiring notices of case disposition, adverse action and mass change, and expiration; (2) providing an automatic cutoff of participation for households that have not been recertified at the end of their certification period by reapplying and being determined eligible for a new period (7 CFR sections 272.10(b)(1)(iii) and 273.10(f) and (g)); and (3) generating data necessary to meet federal issuance and reconciliation reporting requirements. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: The Minnesota Department of Human Services (DHS) maintains the computer system, MAXIS, which is used by the County to support the eligibility determination process. The sample size was based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. While periodic supervisory case reviews are performed to monitor compliance with grant requirements for eligibility, when performing our case file review for eligibility, we noted: • There was no documentation related to the verification of citizenship for 5 of the 60 casefiles tested. • There was no verification of income on 5 of the 60 casefiles tested. • There were issues with 3 other casefiles relating to the clients providing documentation of citizenship and income, but the MAXIS system was not updated to show proper documentation and was instead left blank. Questioned costs: None Context: 13 of the 60 casefiles tested had the above noted issues. Cause: The County has had significant turnover and new staff over the past three years as well as increases in caseloads. There was also changing guidance as waivers from the pandemic expired. All of this provided more opportunities for errors to occur. Effect: Improper input or updating of information in MAXIS and lack of verification or follow-up of eligibility determining factors increase the risk that a program participant will receive benefits when they are not eligible. Repeat finding: Yes – 2021-003 Recommendation: We recommend the County implement process and procedures to provide reasonable assurance that all necessary documentation to support eligibility determination exists and is properly input or updated in MAXIS and issues are followed up in a timely manner. Views of responsible officials: There is no disagreement with the finding.

Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster & Temporary Assistance for Needy Families Assistance Listing Numbers: 10.561 and 93.558 Federal Award Identification Numbers and Years: 222MN101S2514 – 2022 and 2201MNTANF – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55210010 and H55214077 Award Period: 2022 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The Minnesota Department of Human Services (DHS) requires a listing of employees working on income maintenance programs to be submitted quarterly, known as a random moment study listing (RMS listing). DHS then determines the amount applicable to the applicable income maintenance programs through random moment studies. Each quarter the County’s coordinator reviews their RMS listing to ensure the employees listed are accurate for the people working and being coded in the general ledger. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 3 individuals were included on the 1st quarter RMS listing sent to the State that were not supposed to be included in the listings, while 6 individuals were noted to have the same issue on the 4th quarter RMS listing. Questioned costs: None Context: In our testing of 2 of the 4 quarterly RMS listings, 3 individuals were included on the 1st quarter RMS listing sent to the State that were not supposed to be included in the listings, while 6 individuals were noted to have the same issue on the 4th quarter RMS listing. There were 147 County staff listed in the 1st quarter’s RMS listing and 149 County staff listed in the 4th quarter’s RMS listing. Cause: The County's RMS controls and procedures were not robust enough to note that the RMS listings should have excluded various individuals. Increased turnover and growth of the programs also created an increase in the number changes that were needed to be made to the listings. Effect: Lack of proper controls could affect allocation of fundings due to the staff not being in MAXIS or actually assigned to income maintenance case files to properly respond to the random moment requests that are sent by the State as part of the random moment study. Repeat Finding: No Recommendation: We recommend that the County review its procedures and control to ensure all RMS listings sent to the State properly exclude those necessary individuals no longer working in the programs. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Child Support Enforcement Assistance Listing Numbers: 10.561, 93.558, and 93.563 Federal Award Identification Numbers and Years: 222MN101S2514 – 2022, 2201MNTANF – 2022, and 2201MNCSES – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55210010, H55214077, and H55214004 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 1 of 40 disbursements selected for testing lacked formal documentation of review and approval. Questioned costs: None Context: Lack of formal documentation of review and approval was noted with 1 of 40 disbursements selected for testing. Cause: At the time of testing, due to the cost allocation plan using a 2-year lag and then the audit occurring after year end, the item selected for testing was from about 3 years ago, and the County did not retain the supporting documentation of review and approval. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: No Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Agriculture Federal Program Name: Supplemental Nutrition Assistance Program Cluster Assistance Listing Number: 10.561 Federal Award Identification Number and Year: 222MN101S2514 – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Number: H55210010 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The County should have procedures for verifying that an entity with which it plans to enter into a covered transaction is not debarred, suspended, or otherwise excluded per 2 CFR sections 200.212 and 200.318(h); 2 CFR section 180.300. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: It was noted that for 1 of the 5 vendors tested, the County was not able to provide documentation those vendors were not suspended or debarred prior to working with them during 2022. Questioned costs: None Context: 1 of the 5 vendors tested were missing documentation. Cause: The County has updated their contract templates to include a self-certification for the federal suspension and debarment. However, this does not cover vendors that don’t have official contracts with the county or for instance when an old template contract might have been used. Effect: It would be possible for the County to work with a vendor that is federally suspended or debarred and then pay them with federal funds. Repeat finding: Yes – 2021-005 Recommendation: We recommend that the County ensure it is either checking sam.gov and documenting that check or has a contract in place with the required self-certification language for each vendor paid over $25,000 for a type of service or item that was paid for in whole or in part by federal funds. Views of responsible officials: There is no disagreement with the finding.

Federal Agency: U.S. Department of Treasury Federal Program Name: Emergency Rental Assistance Assistance Listing Number: 21.023 Federal Award Identification Number and Year: ERAE0416 – 2021 Award Period: 2022 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Related to the reporting requirements of Emergency Rental Assistance 1 and Emergency Rental Assistance 2, monthly reports were due through June 30 of 2022 and quarterly reports were due for all of 2022. All reports submitted for a federal program should be properly compiled, then reviewed, prior to submission to ensure accurate reporting occurs. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. There were also special provision requirements related to the accuracy of information provided for reallocations that relied on these reports, as the financial information certified as part of reallocation includes monthly expenditure and cumulative obligations levels, as described in the Treasury reallocation guidance. ERA 2 expenditures and obligations reported in quarterly reports by the grantee are inputs to Treasury’s ERA 2 reallocation expenditure and obligation ratios. The reallocation expenditure ratio determines whether the grantee is subject to involuntary reallocation due to an insufficient ratio and the amount of excess funds subject to recapture by Treasury. Condition: During our testing it was noted that, for 10 of the 14 reports selected for testing, the County was not able to provide any documentation of any review performed over the reports prior to submission of the reports. Questioned costs: None Context: 10 of the 14 reports selected for testing were missing documentation. Cause: The County reviewed the quarterly reports for the grant, but the County did not retain and formal documentation of review for the monthly reports. Effect: It is possible that the County could report incorrect information if an error is made in compiling the information since there is no control in place in some instances to ensure that errors are not being made prior to filing. Repeat finding: Yes, in relation to reporting requirements – 2021-007 Recommendation: We recommend the County implement internal controls to ensure that all reports for federal programs are compiled, properly reviewed, and that review be reasonably documented prior to submission of the reports or data. Views of responsible officials: There is no disagreement with the finding.

Federal Agency: U.S. Department of Treasury Federal Program Name: Emergency Rental Assistance Assistance Listing Number: 21.023 Federal Award Identification Number and Year: ERAE0416 – 2021 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The County should have controls in place to make sure all expenditures charged to Emergency Rental Assistance are allowable and the correct amounts are paid. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: During our testing, it was noted that 1 general disbursement out of 40 tested was paid for the wrong amount. The County mistakenly paid $80.20, but the proper amount that should have been paid for electric utilities assistance was $88.20. Questioned costs: None Context: One general disbursement out of 40 tested was paid for the wrong amount. The County mistakenly paid $80.20, but the proper amount that should have been paid for electric utilities assistance was $88. 20. Cause: There was a typographical error in the amount paid. Effect: Lack of proper controls over allowable costs that ensure both allowability of the category of the expenditures as well as accuracy of the amounts paid could result in inaccurate or unallowable expenditures being charged to the grant. Repeat finding: No Recommendation: We recommend the County review its procedures and controls related to emergency rental assistance general expenditures to ensure the accuracy of all payments going forward. Views of responsible officials: There is no disagreement with the finding.

Federal Agency: U.S. Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Award Identification Number and Year: SLFRP2619 – 2021 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The County must follow Uniform Guidance Subsection 200.320 Methods of Procurement for all applicable procurements over the County’s micro-purchase threshold. For purchases over the County's micro-purchase threshold of $10,000 but not exceeding the simplified acquisition threshold of $250,000, the County should follow small purchase procedures. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the County. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: It was noted that for 1 of the 5 vendors tested, there was no documentation retained showing the County requested quotes or rates from another vendor or of the County performing any other type of determination that rates were reasonable. For this reason, it could not be confirmed that the contract was awarded through open competition or that price or rate quotations were obtained from an adequate number of qualified sources, as required for all small purchases. Questioned costs: $81,008 Context: 1 of the 5 vendors tested were missing documentation. Cause: The County was unable to locate the proper supporting documentation. Effect: It would be possible that the County could end up spending more federal dollars than necessary for a product or service, if they are not going through the steps to ensure they are utilizing the best vendor for the county and documenting this process each year. Repeat finding: Yes – 2021-005 Recommendation: We recommend the County follow their federal purchasing policy in all of their federal programs and retain documentation of that process occurring. As necessary, the County may need to add internal controls that are program specific to ensure this properly occurs. Views of responsible officials: There is no disagreement with the finding.

Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Temporary Assistance for Needy Families Assistance Listing Number: 93.558 Federal Award Identification Number and Year: 2201MNTANF – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Number: H55214077 Award Period: 2022 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. The State provides the specifics on the definition of need, which the State and County uses in determining eligibility. Casefiles and related computer systems must be accurately maintained to support eligibility determinations. Condition: The Minnesota Department of Human Services (DHS) maintains the computer system, MAXIS, which is used by the County to support the eligibility determination process. While periodic supervisory case reviews are performed to monitor compliance with grant requirements for eligibility, when performing our case file review for eligibility, we noted that not all documentation was available to support participant eligibility. In other circumstances, information was either input incorrectly or not properly updated in MAXIS. The sample size was based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. The following instances were noted in sample of 60 cases tested: • 2 of 60 casefiles selected for testing had not been updated in MAXIS for the proper work status and were enrolled under incorrect codes. • 3 of 60 casefiles selected for testing provided a birth certificate as proof of citizenship, but their MAXIS files showed as NA. • 1 of 60 casefiles selected for testing did not respond to inquiry of whether or not a member of the household had been convicted of a felony involving a controlled substance or not. • 6 of 60 casefiles selected for testing did not have verified worker approval of annual eligibility certification documentation on file. • 9 of 60 casefiles selected for testing had various inconsistencies between what was shown on MAXIS for income or assets and what was provided as testing support in the casefile to State’s eligibility requirements for TANF as provided in the State plan, including being "needy." Questioned costs: None Context: The context of the variance instances noted in the 60 case files tested is summarized above. Note that, of the 60 case files tested, there were a total of 21 instances that were part of 19 casefiles. Cause: The County has had significant turnover and new staff over the past three years as well as increases in caseloads. There was also changing guidance as waivers from the pandemic expired. All of this provided more opportunities for errors to occur. Effect: Improper input or updating of information in MAXIS and lack of verification or follow-up of eligibility determining factors increase the risk that a program participant will receive benefits when they are not eligible. Repeat finding: Yes – 2021-002 Recommendation: We recommend the County implement process and procedures to provide reasonable assurance that all necessary documentation to support eligibility determination exists and is properly input or updated in MAXIS and issues are followed up in a timely manner. Views of responsible officials: There is no disagreement with the finding

Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster & Temporary Assistance for Needy Families Assistance Listing Numbers: 10.561 and 93.558 Federal Award Identification Numbers and Years: 222MN101S2514 – 2022 and 2201MNTANF – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55210010 and H55214077 Award Period: 2022 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The Minnesota Department of Human Services (DHS) requires a listing of employees working on income maintenance programs to be submitted quarterly, known as a random moment study listing (RMS listing). DHS then determines the amount applicable to the applicable income maintenance programs through random moment studies. Each quarter the County’s coordinator reviews their RMS listing to ensure the employees listed are accurate for the people working and being coded in the general ledger. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 3 individuals were included on the 1st quarter RMS listing sent to the State that were not supposed to be included in the listings, while 6 individuals were noted to have the same issue on the 4th quarter RMS listing. Questioned costs: None Context: In our testing of 2 of the 4 quarterly RMS listings, 3 individuals were included on the 1st quarter RMS listing sent to the State that were not supposed to be included in the listings, while 6 individuals were noted to have the same issue on the 4th quarter RMS listing. There were 147 County staff listed in the 1st quarter’s RMS listing and 149 County staff listed in the 4th quarter’s RMS listing. Cause: The County's RMS controls and procedures were not robust enough to note that the RMS listings should have excluded various individuals. Increased turnover and growth of the programs also created an increase in the number changes that were needed to be made to the listings. Effect: Lack of proper controls could affect allocation of fundings due to the staff not being in MAXIS or actually assigned to income maintenance case files to properly respond to the random moment requests that are sent by the State as part of the random moment study. Repeat Finding: No Recommendation: We recommend that the County review its procedures and control to ensure all RMS listings sent to the State properly exclude those necessary individuals no longer working in the programs. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Child Support Enforcement Assistance Listing Numbers: 10.561, 93.558, and 93.563 Federal Award Identification Numbers and Years: 222MN101S2514 – 2022, 2201MNTANF – 2022, and 2201MNCSES – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55210010, H55214077, and H55214004 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 1 of 40 disbursements selected for testing lacked formal documentation of review and approval. Questioned costs: None Context: Lack of formal documentation of review and approval was noted with 1 of 40 disbursements selected for testing. Cause: At the time of testing, due to the cost allocation plan using a 2-year lag and then the audit occurring after year end, the item selected for testing was from about 3 years ago, and the County did not retain the supporting documentation of review and approval. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: No Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Child Support Enforcement Assistance Listing Numbers: 10.561, 93.558, and 93.563 Federal Award Identification Numbers and Years: 222MN101S2514 – 2022, 2201MNTANF – 2022, and 2201MNCSES – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55210010, H55214077, and H55214004 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 1 of 40 disbursements selected for testing lacked formal documentation of review and approval. Questioned costs: None Context: Lack of formal documentation of review and approval was noted with 1 of 40 disbursements selected for testing. Cause: At the time of testing, due to the cost allocation plan using a 2-year lag and then the audit occurring after year end, the item selected for testing was from about 3 years ago, and the County did not retain the supporting documentation of review and approval. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: No Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Temporary Assistance for Needy Families Assistance Listing Number: 93.558 Federal Award Identification Number and Year: 2201MNTANF – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Number: H55214077 Award Period: 2022 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. The State provides the specifics on the definition of need, which the State and County uses in determining eligibility. Casefiles and related computer systems must be accurately maintained to support eligibility determinations. Condition: The Minnesota Department of Human Services (DHS) maintains the computer system, MAXIS, which is used by the County to support the eligibility determination process. While periodic supervisory case reviews are performed to monitor compliance with grant requirements for eligibility, when performing our case file review for eligibility, we noted that not all documentation was available to support participant eligibility. In other circumstances, information was either input incorrectly or not properly updated in MAXIS. The sample size was based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. The following instances were noted in sample of 60 cases tested: • 2 of 60 casefiles selected for testing had not been updated in MAXIS for the proper work status and were enrolled under incorrect codes. • 3 of 60 casefiles selected for testing provided a birth certificate as proof of citizenship, but their MAXIS files showed as NA. • 1 of 60 casefiles selected for testing did not respond to inquiry of whether or not a member of the household had been convicted of a felony involving a controlled substance or not. • 6 of 60 casefiles selected for testing did not have verified worker approval of annual eligibility certification documentation on file. • 9 of 60 casefiles selected for testing had various inconsistencies between what was shown on MAXIS for income or assets and what was provided as testing support in the casefile to State’s eligibility requirements for TANF as provided in the State plan, including being "needy." Questioned costs: None Context: The context of the variance instances noted in the 60 case files tested is summarized above. Note that, of the 60 case files tested, there were a total of 21 instances that were part of 19 casefiles. Cause: The County has had significant turnover and new staff over the past three years as well as increases in caseloads. There was also changing guidance as waivers from the pandemic expired. All of this provided more opportunities for errors to occur. Effect: Improper input or updating of information in MAXIS and lack of verification or follow-up of eligibility determining factors increase the risk that a program participant will receive benefits when they are not eligible. Repeat finding: Yes – 2021-002 Recommendation: We recommend the County implement process and procedures to provide reasonable assurance that all necessary documentation to support eligibility determination exists and is properly input or updated in MAXIS and issues are followed up in a timely manner. Views of responsible officials: There is no disagreement with the finding

Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster & Temporary Assistance for Needy Families Assistance Listing Numbers: 10.561 and 93.558 Federal Award Identification Numbers and Years: 222MN101S2514 – 2022 and 2201MNTANF – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55210010 and H55214077 Award Period: 2022 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The Minnesota Department of Human Services (DHS) requires a listing of employees working on income maintenance programs to be submitted quarterly, known as a random moment study listing (RMS listing). DHS then determines the amount applicable to the applicable income maintenance programs through random moment studies. Each quarter the County’s coordinator reviews their RMS listing to ensure the employees listed are accurate for the people working and being coded in the general ledger. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 3 individuals were included on the 1st quarter RMS listing sent to the State that were not supposed to be included in the listings, while 6 individuals were noted to have the same issue on the 4th quarter RMS listing. Questioned costs: None Context: In our testing of 2 of the 4 quarterly RMS listings, 3 individuals were included on the 1st quarter RMS listing sent to the State that were not supposed to be included in the listings, while 6 individuals were noted to have the same issue on the 4th quarter RMS listing. There were 147 County staff listed in the 1st quarter’s RMS listing and 149 County staff listed in the 4th quarter’s RMS listing. Cause: The County's RMS controls and procedures were not robust enough to note that the RMS listings should have excluded various individuals. Increased turnover and growth of the programs also created an increase in the number changes that were needed to be made to the listings. Effect: Lack of proper controls could affect allocation of fundings due to the staff not being in MAXIS or actually assigned to income maintenance case files to properly respond to the random moment requests that are sent by the State as part of the random moment study. Repeat Finding: No Recommendation: We recommend that the County review its procedures and control to ensure all RMS listings sent to the State properly exclude those necessary individuals no longer working in the programs. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Child Support Enforcement Assistance Listing Numbers: 10.561, 93.558, and 93.563 Federal Award Identification Numbers and Years: 222MN101S2514 – 2022, 2201MNTANF – 2022, and 2201MNCSES – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55210010, H55214077, and H55214004 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 1 of 40 disbursements selected for testing lacked formal documentation of review and approval. Questioned costs: None Context: Lack of formal documentation of review and approval was noted with 1 of 40 disbursements selected for testing. Cause: At the time of testing, due to the cost allocation plan using a 2-year lag and then the audit occurring after year end, the item selected for testing was from about 3 years ago, and the County did not retain the supporting documentation of review and approval. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: No Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Agriculture Federal Program Name: Supplemental Nutrition Assistance Program Cluster Assistance Listing Number: 10.561 Federal Award Identification Number and Year: 222MN101S2514 – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Number: H55210010 Award Period: 2022 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Agencies are required to automate their SNAP operations and computerize their systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP (7 CFR sections 272.10 and 277.18). This includes: (1) processing and storing all case file information necessary for eligibility determination and benefit calculation, identifying specific elements that affect eligibility, and notifying the certification unit of cases requiring notices of case disposition, adverse action and mass change, and expiration; (2) providing an automatic cutoff of participation for households that have not been recertified at the end of their certification period by reapplying and being determined eligible for a new period (7 CFR sections 272.10(b)(1)(iii) and 273.10(f) and (g)); and (3) generating data necessary to meet federal issuance and reconciliation reporting requirements. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: The Minnesota Department of Human Services (DHS) maintains the computer system, MAXIS, which is used by the County to support the eligibility determination process. The sample size was based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. While periodic supervisory case reviews are performed to monitor compliance with grant requirements for eligibility, when performing our case file review for eligibility, we noted: • There was no documentation related to the verification of citizenship for 5 of the 60 casefiles tested. • There was no verification of income on 5 of the 60 casefiles tested. • There were issues with 3 other casefiles relating to the clients providing documentation of citizenship and income, but the MAXIS system was not updated to show proper documentation and was instead left blank. Questioned costs: None Context: 13 of the 60 casefiles tested had the above noted issues. Cause: The County has had significant turnover and new staff over the past three years as well as increases in caseloads. There was also changing guidance as waivers from the pandemic expired. All of this provided more opportunities for errors to occur. Effect: Improper input or updating of information in MAXIS and lack of verification or follow-up of eligibility determining factors increase the risk that a program participant will receive benefits when they are not eligible. Repeat finding: Yes – 2021-003 Recommendation: We recommend the County implement process and procedures to provide reasonable assurance that all necessary documentation to support eligibility determination exists and is properly input or updated in MAXIS and issues are followed up in a timely manner. Views of responsible officials: There is no disagreement with the finding.

Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster & Temporary Assistance for Needy Families Assistance Listing Numbers: 10.561 and 93.558 Federal Award Identification Numbers and Years: 222MN101S2514 – 2022 and 2201MNTANF – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55210010 and H55214077 Award Period: 2022 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The Minnesota Department of Human Services (DHS) requires a listing of employees working on income maintenance programs to be submitted quarterly, known as a random moment study listing (RMS listing). DHS then determines the amount applicable to the applicable income maintenance programs through random moment studies. Each quarter the County’s coordinator reviews their RMS listing to ensure the employees listed are accurate for the people working and being coded in the general ledger. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 3 individuals were included on the 1st quarter RMS listing sent to the State that were not supposed to be included in the listings, while 6 individuals were noted to have the same issue on the 4th quarter RMS listing. Questioned costs: None Context: In our testing of 2 of the 4 quarterly RMS listings, 3 individuals were included on the 1st quarter RMS listing sent to the State that were not supposed to be included in the listings, while 6 individuals were noted to have the same issue on the 4th quarter RMS listing. There were 147 County staff listed in the 1st quarter’s RMS listing and 149 County staff listed in the 4th quarter’s RMS listing. Cause: The County's RMS controls and procedures were not robust enough to note that the RMS listings should have excluded various individuals. Increased turnover and growth of the programs also created an increase in the number changes that were needed to be made to the listings. Effect: Lack of proper controls could affect allocation of fundings due to the staff not being in MAXIS or actually assigned to income maintenance case files to properly respond to the random moment requests that are sent by the State as part of the random moment study. Repeat Finding: No Recommendation: We recommend that the County review its procedures and control to ensure all RMS listings sent to the State properly exclude those necessary individuals no longer working in the programs. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Child Support Enforcement Assistance Listing Numbers: 10.561, 93.558, and 93.563 Federal Award Identification Numbers and Years: 222MN101S2514 – 2022, 2201MNTANF – 2022, and 2201MNCSES – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55210010, H55214077, and H55214004 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 1 of 40 disbursements selected for testing lacked formal documentation of review and approval. Questioned costs: None Context: Lack of formal documentation of review and approval was noted with 1 of 40 disbursements selected for testing. Cause: At the time of testing, due to the cost allocation plan using a 2-year lag and then the audit occurring after year end, the item selected for testing was from about 3 years ago, and the County did not retain the supporting documentation of review and approval. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: No Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Agriculture Federal Program Name: Supplemental Nutrition Assistance Program Cluster Assistance Listing Number: 10.561 Federal Award Identification Number and Year: 222MN101S2514 – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Number: H55210010 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The County should have procedures for verifying that an entity with which it plans to enter into a covered transaction is not debarred, suspended, or otherwise excluded per 2 CFR sections 200.212 and 200.318(h); 2 CFR section 180.300. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: It was noted that for 1 of the 5 vendors tested, the County was not able to provide documentation those vendors were not suspended or debarred prior to working with them during 2022. Questioned costs: None Context: 1 of the 5 vendors tested were missing documentation. Cause: The County has updated their contract templates to include a self-certification for the federal suspension and debarment. However, this does not cover vendors that don’t have official contracts with the county or for instance when an old template contract might have been used. Effect: It would be possible for the County to work with a vendor that is federally suspended or debarred and then pay them with federal funds. Repeat finding: Yes – 2021-005 Recommendation: We recommend that the County ensure it is either checking sam.gov and documenting that check or has a contract in place with the required self-certification language for each vendor paid over $25,000 for a type of service or item that was paid for in whole or in part by federal funds. Views of responsible officials: There is no disagreement with the finding.

Federal Agency: U.S. Department of Treasury Federal Program Name: Emergency Rental Assistance Assistance Listing Number: 21.023 Federal Award Identification Number and Year: ERAE0416 – 2021 Award Period: 2022 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Related to the reporting requirements of Emergency Rental Assistance 1 and Emergency Rental Assistance 2, monthly reports were due through June 30 of 2022 and quarterly reports were due for all of 2022. All reports submitted for a federal program should be properly compiled, then reviewed, prior to submission to ensure accurate reporting occurs. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. There were also special provision requirements related to the accuracy of information provided for reallocations that relied on these reports, as the financial information certified as part of reallocation includes monthly expenditure and cumulative obligations levels, as described in the Treasury reallocation guidance. ERA 2 expenditures and obligations reported in quarterly reports by the grantee are inputs to Treasury’s ERA 2 reallocation expenditure and obligation ratios. The reallocation expenditure ratio determines whether the grantee is subject to involuntary reallocation due to an insufficient ratio and the amount of excess funds subject to recapture by Treasury. Condition: During our testing it was noted that, for 10 of the 14 reports selected for testing, the County was not able to provide any documentation of any review performed over the reports prior to submission of the reports. Questioned costs: None Context: 10 of the 14 reports selected for testing were missing documentation. Cause: The County reviewed the quarterly reports for the grant, but the County did not retain and formal documentation of review for the monthly reports. Effect: It is possible that the County could report incorrect information if an error is made in compiling the information since there is no control in place in some instances to ensure that errors are not being made prior to filing. Repeat finding: Yes, in relation to reporting requirements – 2021-007 Recommendation: We recommend the County implement internal controls to ensure that all reports for federal programs are compiled, properly reviewed, and that review be reasonably documented prior to submission of the reports or data. Views of responsible officials: There is no disagreement with the finding.

Federal Agency: U.S. Department of Treasury Federal Program Name: Emergency Rental Assistance Assistance Listing Number: 21.023 Federal Award Identification Number and Year: ERAE0416 – 2021 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The County should have controls in place to make sure all expenditures charged to Emergency Rental Assistance are allowable and the correct amounts are paid. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: During our testing, it was noted that 1 general disbursement out of 40 tested was paid for the wrong amount. The County mistakenly paid $80.20, but the proper amount that should have been paid for electric utilities assistance was $88.20. Questioned costs: None Context: One general disbursement out of 40 tested was paid for the wrong amount. The County mistakenly paid $80.20, but the proper amount that should have been paid for electric utilities assistance was $88. 20. Cause: There was a typographical error in the amount paid. Effect: Lack of proper controls over allowable costs that ensure both allowability of the category of the expenditures as well as accuracy of the amounts paid could result in inaccurate or unallowable expenditures being charged to the grant. Repeat finding: No Recommendation: We recommend the County review its procedures and controls related to emergency rental assistance general expenditures to ensure the accuracy of all payments going forward. Views of responsible officials: There is no disagreement with the finding.

Federal Agency: U.S. Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Award Identification Number and Year: SLFRP2619 – 2021 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The County must follow Uniform Guidance Subsection 200.320 Methods of Procurement for all applicable procurements over the County’s micro-purchase threshold. For purchases over the County's micro-purchase threshold of $10,000 but not exceeding the simplified acquisition threshold of $250,000, the County should follow small purchase procedures. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the County. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: It was noted that for 1 of the 5 vendors tested, there was no documentation retained showing the County requested quotes or rates from another vendor or of the County performing any other type of determination that rates were reasonable. For this reason, it could not be confirmed that the contract was awarded through open competition or that price or rate quotations were obtained from an adequate number of qualified sources, as required for all small purchases. Questioned costs: $81,008 Context: 1 of the 5 vendors tested were missing documentation. Cause: The County was unable to locate the proper supporting documentation. Effect: It would be possible that the County could end up spending more federal dollars than necessary for a product or service, if they are not going through the steps to ensure they are utilizing the best vendor for the county and documenting this process each year. Repeat finding: Yes – 2021-005 Recommendation: We recommend the County follow their federal purchasing policy in all of their federal programs and retain documentation of that process occurring. As necessary, the County may need to add internal controls that are program specific to ensure this properly occurs. Views of responsible officials: There is no disagreement with the finding.

Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Temporary Assistance for Needy Families Assistance Listing Number: 93.558 Federal Award Identification Number and Year: 2201MNTANF – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Number: H55214077 Award Period: 2022 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. The State provides the specifics on the definition of need, which the State and County uses in determining eligibility. Casefiles and related computer systems must be accurately maintained to support eligibility determinations. Condition: The Minnesota Department of Human Services (DHS) maintains the computer system, MAXIS, which is used by the County to support the eligibility determination process. While periodic supervisory case reviews are performed to monitor compliance with grant requirements for eligibility, when performing our case file review for eligibility, we noted that not all documentation was available to support participant eligibility. In other circumstances, information was either input incorrectly or not properly updated in MAXIS. The sample size was based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. The following instances were noted in sample of 60 cases tested: • 2 of 60 casefiles selected for testing had not been updated in MAXIS for the proper work status and were enrolled under incorrect codes. • 3 of 60 casefiles selected for testing provided a birth certificate as proof of citizenship, but their MAXIS files showed as NA. • 1 of 60 casefiles selected for testing did not respond to inquiry of whether or not a member of the household had been convicted of a felony involving a controlled substance or not. • 6 of 60 casefiles selected for testing did not have verified worker approval of annual eligibility certification documentation on file. • 9 of 60 casefiles selected for testing had various inconsistencies between what was shown on MAXIS for income or assets and what was provided as testing support in the casefile to State’s eligibility requirements for TANF as provided in the State plan, including being "needy." Questioned costs: None Context: The context of the variance instances noted in the 60 case files tested is summarized above. Note that, of the 60 case files tested, there were a total of 21 instances that were part of 19 casefiles. Cause: The County has had significant turnover and new staff over the past three years as well as increases in caseloads. There was also changing guidance as waivers from the pandemic expired. All of this provided more opportunities for errors to occur. Effect: Improper input or updating of information in MAXIS and lack of verification or follow-up of eligibility determining factors increase the risk that a program participant will receive benefits when they are not eligible. Repeat finding: Yes – 2021-002 Recommendation: We recommend the County implement process and procedures to provide reasonable assurance that all necessary documentation to support eligibility determination exists and is properly input or updated in MAXIS and issues are followed up in a timely manner. Views of responsible officials: There is no disagreement with the finding

Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster & Temporary Assistance for Needy Families Assistance Listing Numbers: 10.561 and 93.558 Federal Award Identification Numbers and Years: 222MN101S2514 – 2022 and 2201MNTANF – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55210010 and H55214077 Award Period: 2022 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The Minnesota Department of Human Services (DHS) requires a listing of employees working on income maintenance programs to be submitted quarterly, known as a random moment study listing (RMS listing). DHS then determines the amount applicable to the applicable income maintenance programs through random moment studies. Each quarter the County’s coordinator reviews their RMS listing to ensure the employees listed are accurate for the people working and being coded in the general ledger. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 3 individuals were included on the 1st quarter RMS listing sent to the State that were not supposed to be included in the listings, while 6 individuals were noted to have the same issue on the 4th quarter RMS listing. Questioned costs: None Context: In our testing of 2 of the 4 quarterly RMS listings, 3 individuals were included on the 1st quarter RMS listing sent to the State that were not supposed to be included in the listings, while 6 individuals were noted to have the same issue on the 4th quarter RMS listing. There were 147 County staff listed in the 1st quarter’s RMS listing and 149 County staff listed in the 4th quarter’s RMS listing. Cause: The County's RMS controls and procedures were not robust enough to note that the RMS listings should have excluded various individuals. Increased turnover and growth of the programs also created an increase in the number changes that were needed to be made to the listings. Effect: Lack of proper controls could affect allocation of fundings due to the staff not being in MAXIS or actually assigned to income maintenance case files to properly respond to the random moment requests that are sent by the State as part of the random moment study. Repeat Finding: No Recommendation: We recommend that the County review its procedures and control to ensure all RMS listings sent to the State properly exclude those necessary individuals no longer working in the programs. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Child Support Enforcement Assistance Listing Numbers: 10.561, 93.558, and 93.563 Federal Award Identification Numbers and Years: 222MN101S2514 – 2022, 2201MNTANF – 2022, and 2201MNCSES – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55210010, H55214077, and H55214004 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 1 of 40 disbursements selected for testing lacked formal documentation of review and approval. Questioned costs: None Context: Lack of formal documentation of review and approval was noted with 1 of 40 disbursements selected for testing. Cause: At the time of testing, due to the cost allocation plan using a 2-year lag and then the audit occurring after year end, the item selected for testing was from about 3 years ago, and the County did not retain the supporting documentation of review and approval. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: No Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Child Support Enforcement Assistance Listing Numbers: 10.561, 93.558, and 93.563 Federal Award Identification Numbers and Years: 222MN101S2514 – 2022, 2201MNTANF – 2022, and 2201MNCSES – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55210010, H55214077, and H55214004 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 1 of 40 disbursements selected for testing lacked formal documentation of review and approval. Questioned costs: None Context: Lack of formal documentation of review and approval was noted with 1 of 40 disbursements selected for testing. Cause: At the time of testing, due to the cost allocation plan using a 2-year lag and then the audit occurring after year end, the item selected for testing was from about 3 years ago, and the County did not retain the supporting documentation of review and approval. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: No Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Temporary Assistance for Needy Families Assistance Listing Number: 93.558 Federal Award Identification Number and Year: 2201MNTANF – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Number: H55214077 Award Period: 2022 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. The State provides the specifics on the definition of need, which the State and County uses in determining eligibility. Casefiles and related computer systems must be accurately maintained to support eligibility determinations. Condition: The Minnesota Department of Human Services (DHS) maintains the computer system, MAXIS, which is used by the County to support the eligibility determination process. While periodic supervisory case reviews are performed to monitor compliance with grant requirements for eligibility, when performing our case file review for eligibility, we noted that not all documentation was available to support participant eligibility. In other circumstances, information was either input incorrectly or not properly updated in MAXIS. The sample size was based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. The following instances were noted in sample of 60 cases tested: • 2 of 60 casefiles selected for testing had not been updated in MAXIS for the proper work status and were enrolled under incorrect codes. • 3 of 60 casefiles selected for testing provided a birth certificate as proof of citizenship, but their MAXIS files showed as NA. • 1 of 60 casefiles selected for testing did not respond to inquiry of whether or not a member of the household had been convicted of a felony involving a controlled substance or not. • 6 of 60 casefiles selected for testing did not have verified worker approval of annual eligibility certification documentation on file. • 9 of 60 casefiles selected for testing had various inconsistencies between what was shown on MAXIS for income or assets and what was provided as testing support in the casefile to State’s eligibility requirements for TANF as provided in the State plan, including being "needy." Questioned costs: None Context: The context of the variance instances noted in the 60 case files tested is summarized above. Note that, of the 60 case files tested, there were a total of 21 instances that were part of 19 casefiles. Cause: The County has had significant turnover and new staff over the past three years as well as increases in caseloads. There was also changing guidance as waivers from the pandemic expired. All of this provided more opportunities for errors to occur. Effect: Improper input or updating of information in MAXIS and lack of verification or follow-up of eligibility determining factors increase the risk that a program participant will receive benefits when they are not eligible. Repeat finding: Yes – 2021-002 Recommendation: We recommend the County implement process and procedures to provide reasonable assurance that all necessary documentation to support eligibility determination exists and is properly input or updated in MAXIS and issues are followed up in a timely manner. Views of responsible officials: There is no disagreement with the finding

Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster & Temporary Assistance for Needy Families Assistance Listing Numbers: 10.561 and 93.558 Federal Award Identification Numbers and Years: 222MN101S2514 – 2022 and 2201MNTANF – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55210010 and H55214077 Award Period: 2022 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The Minnesota Department of Human Services (DHS) requires a listing of employees working on income maintenance programs to be submitted quarterly, known as a random moment study listing (RMS listing). DHS then determines the amount applicable to the applicable income maintenance programs through random moment studies. Each quarter the County’s coordinator reviews their RMS listing to ensure the employees listed are accurate for the people working and being coded in the general ledger. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 3 individuals were included on the 1st quarter RMS listing sent to the State that were not supposed to be included in the listings, while 6 individuals were noted to have the same issue on the 4th quarter RMS listing. Questioned costs: None Context: In our testing of 2 of the 4 quarterly RMS listings, 3 individuals were included on the 1st quarter RMS listing sent to the State that were not supposed to be included in the listings, while 6 individuals were noted to have the same issue on the 4th quarter RMS listing. There were 147 County staff listed in the 1st quarter’s RMS listing and 149 County staff listed in the 4th quarter’s RMS listing. Cause: The County's RMS controls and procedures were not robust enough to note that the RMS listings should have excluded various individuals. Increased turnover and growth of the programs also created an increase in the number changes that were needed to be made to the listings. Effect: Lack of proper controls could affect allocation of fundings due to the staff not being in MAXIS or actually assigned to income maintenance case files to properly respond to the random moment requests that are sent by the State as part of the random moment study. Repeat Finding: No Recommendation: We recommend that the County review its procedures and control to ensure all RMS listings sent to the State properly exclude those necessary individuals no longer working in the programs. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Child Support Enforcement Assistance Listing Numbers: 10.561, 93.558, and 93.563 Federal Award Identification Numbers and Years: 222MN101S2514 – 2022, 2201MNTANF – 2022, and 2201MNCSES – 2022 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55210010, H55214077, and H55214004 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 1 of 40 disbursements selected for testing lacked formal documentation of review and approval. Questioned costs: None Context: Lack of formal documentation of review and approval was noted with 1 of 40 disbursements selected for testing. Cause: At the time of testing, due to the cost allocation plan using a 2-year lag and then the audit occurring after year end, the item selected for testing was from about 3 years ago, and the County did not retain the supporting documentation of review and approval. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: No Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.