Title: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Policies: BASIS OF PRESENTATIONThe accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal grant activity of the Municipality of Salinas (Municipality) under programs of the federal government for the year ended June 30, 2022. 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). Therefore, some amounts presented in this Schedule may differ from the amounts presented in the preparation of the basic financial statements.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
a.The Schedule is prepared from Municipalitys accounting records and presents only a selected portion of the operations of the Municipality, it is not intended to, and does not present, the financial position or changes in net position of the Municipality.b.The Municipality in accordance with the terms and conditions of the grants, records the financial transactions which are consistent with accounting principles generally accepted in the United States of America.c.Expenditures are recognized in the accounting period in which the liability is incurred, if measurable or when actually paid, whichever occurs first.d.Expenditures reported on the Schedule are reported on the modified accrual basis of accounting, except for Section 8 Housing Choice Voucher Program (HCV). Expenditures for HCV Program are equal to the ACC subsidy for the PHA fiscal period. Expenditures for Disaster Grants- Public Assistance (FEMA) are recognized in the period when; (a) FEMA has approved the PW and (b) eligible expenditures are incurred. e.State or local government redistributions of federal awards to the Municipality, known as passthrough awards, should be treated by the Municipality as though they were received directly from the federal government. The Uniform Guidance requires the Schedule to include the name of the passthrough entity and the identifying number assigned by the pass-through entity for the federal awards received as a sub recipient. Items identified as N/AV represents identifying numbers that were not available.
Title: ASSISTANCE LISTING NUMBER
Accounting Policies: BASIS OF PRESENTATIONThe accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal grant activity of the Municipality of Salinas (Municipality) under programs of the federal government for the year ended June 30, 2022. 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). Therefore, some amounts presented in this Schedule may differ from the amounts presented in the preparation of the basic financial statements.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
The Assistance Listing Number (ALN), formerly known as the Catalog of Federal Domestic Assistance (CFDA) Number, is a five-digit number assigned in the awarding document for all federal assistance award mechanisms, including federal grants and cooperative agreements. Assistance listings are detailed public descriptions of federal programs that provide grants, loans, scholarships, insurance, and other types of assistance awards. The Sam.gov assistance listing is the publicly available online database showing all available Federally-funded programs.
Title: INDIRECT COSTS
Accounting Policies: BASIS OF PRESENTATIONThe accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal grant activity of the Municipality of Salinas (Municipality) under programs of the federal government for the year ended June 30, 2022. 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). Therefore, some amounts presented in this Schedule may differ from the amounts presented in the preparation of the basic financial statements.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
The Municipality has elected not to use the 10% de minimis cost rate allowed under the Uniform Guidance. The Municipality did not charge indirect cost to federal grants during the year ended June 30, 2022.
Title: RELATIONSHIP TO FEDERAL FINANCIAL REPORTS
Accounting Policies: BASIS OF PRESENTATIONThe accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal grant activity of the Municipality of Salinas (Municipality) under programs of the federal government for the year ended June 30, 2022. 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). Therefore, some amounts presented in this Schedule may differ from the amounts presented in the preparation of the basic financial statements.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
Amounts reported in the accompanying Schedule are included in the General Fund, Disaster Grants Fund, American Rescue Plan Act Fund, and the Other Governmental Funds in the Municipalitys fund financial statements.
Title: COMMUNITY DISASTER LOANS (ASSISTANCE LISTING NO. 97.030)
Accounting Policies: BASIS OF PRESENTATIONThe accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal grant activity of the Municipality of Salinas (Municipality) under programs of the federal government for the year ended June 30, 2022. 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). Therefore, some amounts presented in this Schedule may differ from the amounts presented in the preparation of the basic financial statements.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
Community Disaster Loan Hurricane MariaAs reported in Note 11 to the financial statements, the Municipality had an outstanding federal loan balance as of June 30, 2021. The loan was a Community Disaster Loan (CDL) awarded by the Federal Emergency Management Agency (FEMA) in the amount of $2,977,386. The note, bearing interest at 2.625% annually was due in 2023. The purpose of the note was to provide operational funding to the Municipality to continue operating after substantial revenue losses caused by Hurricane Maria. The terms of the loan provide that if the Municipality has not recovered sufficiently to meet its operating budget after three full fiscal years, repayment of all or part of the loan may be cancelled. Federal statutes and regulations do not impose continuing compliance requirements on the outstanding balance of the loan, other than the repayment of the loan. Therefore, the outstanding balance of the loan is not included in the face of the Schedule. In accordance with the Extending Government Funding and Delivering Emergency Assistance Act (P.L. 117-43) approved by the United States Congress, repayment of the outstanding balance ($2,977,386) of the referenced CDL was cancelled. The Community Disaster Loan-Earthquake awarded by FEMA with a total issue of $2,664,755 at an interest rate of 0.250%. This note provides operational funding for local governments to continue to operate after a substantial revenue loss caused by a disaster. The CDL payments due to this loan are under evaluation by the Federal Government. In accordance with the Extending Government Funding and Delivering Emergency Assistance Act (P.L. 117-43) approved by the United States Congress, drawdowns made prior to enacting the Act on September 30, 2021 was cancelled ($90,000). Any amounts drawn on the loan on or after October 1, 2021, must continue to follow the terms and conditions of the loan.
Title: CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS (ALNO 21.027)
Accounting Policies: BASIS OF PRESENTATIONThe accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal grant activity of the Municipality of Salinas (Municipality) under programs of the federal government for the year ended June 30, 2022. 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). Therefore, some amounts presented in this Schedule may differ from the amounts presented in the preparation of the basic financial statements.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
On March 11, 2022, was signed into law the American Rescue Plan Act (ARPA) of 2021, the latest COVID-19 stimulus package. Within ARPA assigned funds, the Coronavirus State and Local Fiscal Recovery Fund provides $350 billion for states, municipalities, counties, tribes and territories, including $130.2 billion for local governments split evenly between municipalities and counties. Accordingly, the Municipality of Salinas received $5.5 million to respond to the COVID-19 public health emergency and its economic impacts. The majority of the grant expenditures will be incurred in the following year.
Title: LATENESS OF SINGLE AUDIT REPORTING PACKAGE
Accounting Policies: BASIS OF PRESENTATIONThe accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal grant activity of the Municipality of Salinas (Municipality) under programs of the federal government for the year ended June 30, 2022. 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). Therefore, some amounts presented in this Schedule may differ from the amounts presented in the preparation of the basic financial statements.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
The Single Audit reporting package, as defined and required in 2 CFR 200 for the fiscal year ended June 30, 2022, could not be submitted in a timely manner. From 2017 to the present, Puerto Rico has suffered four consecutive emergencies caused by nature and health situations: Hurricane Maria, Earthquakes, COVID-19, and Hurricane Fiona. The Municipality of Salinas has carried out emergency work and taken into consideration the waivers issued by the OMB, resulting in delays of the administrative work for the fiscal year 2021-2022.