Notes to SEFA
Title: Basis of Presentation
Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual and accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance where certain types of expenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: City of Midland has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance.
The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of City of Midland under programs of the federal government for the year ended June 30, 2023. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for
Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of City of Midland, it is not intended to and does not present the financial position, changes in net position, or cash flows of the City of Midland.
Title: Reconciliation to the Financial Statements
Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual and accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance where certain types of expenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: City of Midland has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance.
Federal revenue per the financial statements: $5,107,074;
Prior year deferred revenue - unavailable: ($1,515,936);
Deferred revenue - unavailable: $435,050;
SRF loan proceeds recognized as debt in proprietary funds (AL 66.458): $4,804,808;
SRF loan proceeds in storm water management fund (AL 66.458): $285,026;
Prior year adjustment to community development block grants (AL 14.218): $628,414;
Prior year adjustment to federal transit formula grants (AL 20.507): ($8,806);
City-wide revenue for projects: $308,721;
Total expenditures of federal awards: $10,044,351.
An adjustment was made to federal transit formula grants (AL 20.507) of $8,806 for amounts incurred during the prior fiscal year that were not properly reported on the schedule of expenditures of federal awards in the prior year. In addition, an adjustment was needed for amounts reported in the prior year schedule of expenditures of federal awards for community development block grants (AL 14.218) that were not ultimately charged to the program. These adjustments were included in the current year since they were not considered material and would not have affected major programs tested in the prior fiscal year.
Title: Subrecipients
Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual and accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance where certain types of expenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: City of Midland has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance.
Of the federal expenditures presented in the Schedule, the City provided federal awards to subrecipients as follows:
Assistance Listing - Number Amount
14.218 - $81,664, 97.067 - $716,600, Total: $798,264.
Title: Disaster Grants - Public Assistance (Presidentially Declared Disasters)
Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual and accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance where certain types of expenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: City of Midland has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance.
The expenditures reported for Disaster Grants – Public Assistance AL# 97.036 in the Schedule of Expenditures of Federal Awards include estimates for mandatory insurance deductions that can be applied by the oversight agency (FEMA) at completion of the project. Estimates are based on historical calculations performed by FEMA on completed projects. Estimated amounts may differ depending on final project costs
and oversight agency determinations.
In addition, expenditures reported for these grants in many instances exceed obligated amounts for the projects. The City’s projects are considered “large” and are eligible to be reimbursed for more than the obligated amounts. FEMA will adjust obligated amounts based on actual cost.