Finding Reference Number: SA2022-001 Charging Eligible Program Costs to the Correct Category Assistance Listing Number: 21.027 Assistance Listing Title: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Name of Federal Agency: Department of the Treasury Federal Award Identification Number: SLFRP2014 Criteria: The award terms and conditions of the Coronavirus State and Local Fiscal Recovery Funds agreement with the Department of the Treasury indicate that as the recipient, the City ?understands and agrees that the funds disbursed under this award may only be used in compliance with sections 602(c) and 603(c) of the Social Security Act (the Act) and Treasury?s regulations implementing that section and guidance. Under that guidance, the City may expend funds under five specific categories, including support public health expenditures, address negative economic impacts caused by the public health emergency, replace lost public sector revenue, provide premium pay to essential workers, and invest in water, sewer and broadband infrastructure. Condition: We selected forty services and supplies disbursements charged to the program and noted one disbursement in the amount of $249,999 for a Police Department taser certification plan was included in the ?address negative economic impacts caused by the public health emergency? category in the quarterly Project and Expenditure Report filed with the Department of the Treasury, which does not appear to be an allowable cost under that program category. Although this program cost appears to be allowable under the revenue loss category, the City should not have charged it to the ?address negative economic impacts? category. Questioned Costs: We are not questioning the costs, because the costs are eligible expenditures under the provision of government services of the ?replace lost public sector revenue? category and we understand the City is able to correct the reporting during the next reporting window on the Department of the Treasury reporting portal. Cause: We understand that City staff tried to select an appropriate category when coding the costs in the Project and Expenditure Report, using the descriptions available in the system, but should have included the costs in the ?replace lost public sector revenue? category. Effect: The City is not in compliance with the award terms and conditions of the Coronavirus State and Local Fiscal Recovery Funds program. Recommendation: The City should develop procedures to ensure that costs charged to the Coronavirus State and Local Fiscal Recovery Funds program are eligible costs and that those costs are reported in the correct category when reporting to the Department of the Treasury. View of Responsible Officials and Planned Corrective Actions: Please see Corrective Action Plan separately prepared by the City.
Finding Reference Number: SA2022-002 Suspension and Debarment Documentation for Contracts and Subcontracts Assistance Listing Number: 21.027 Assistance Listing Title: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Name of Federal Agency: Department of the Treasury Federal Award Identification Number: SLFRP2014 Criteria: The award terms and conditions of the Coronavirus State and Local Fiscal Recovery Funds agreement with the Department of the Treasury requires that the City comply with OMB Guidelines to Agencies on Governmentwide Debarment and Suspension (Nonprocurement), 2 C.F.R. Part 180, including the requirement to include a term or condition in all lower tier covered transactions (contracts and subcontracts described in 2 C.F.R. Part 180, subpart B) that the award is subject to 2 C.F.R. Part 180 and Treasury?s implementing regulation at 31 C.F.R. Part 19. In addition, the OMB Compliance Supplement for the Program requires that prior to entering into subawards and contracts with award funds, recipients must verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded pursuant to 31 CFR section 19.300. Condition: We selected forty-two transactions for testing and although some were exempt from the suspension and debarment procurement requirements, and we noted thirty-three contracts and two subrecipient agreements did not include a term or condition related to compliance with debarment and suspension compliance provisions. We also understand that the City did not verify that the contractors and subrecipient were not suspended, debarred, or otherwise excluded prior to entering into the agreements. We did note that as of March 29, 2023, none of the entities were included on the exclusions list on SAM.gov. Cause: We understand that staff was not aware of the requirement to include the debarment and suspension provisions in the contracts and the requirement to verify the status of contractors or subrecipients prior to entering into agreements with the entities. Effect: The City is not in compliance with the award terms and conditions and the OMB Compliance Supplement requirements of the Coronavirus State and Local Fiscal Recovery Funds program. Recommendation: The City should develop procedures to ensure compliance with debarment and suspension provisions of the grant award terms and conditions and the OMB Compliance Supplement of the Coronavirus State and Local Fiscal Recovery Funds program. View of Responsible Officials and Planned Corrective Actions: Please see Corrective Action Plan separately prepared by the City.
Finding Reference Number: SA2022-001 Charging Eligible Program Costs to the Correct Category Assistance Listing Number: 21.027 Assistance Listing Title: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Name of Federal Agency: Department of the Treasury Federal Award Identification Number: SLFRP2014 Criteria: The award terms and conditions of the Coronavirus State and Local Fiscal Recovery Funds agreement with the Department of the Treasury indicate that as the recipient, the City ?understands and agrees that the funds disbursed under this award may only be used in compliance with sections 602(c) and 603(c) of the Social Security Act (the Act) and Treasury?s regulations implementing that section and guidance. Under that guidance, the City may expend funds under five specific categories, including support public health expenditures, address negative economic impacts caused by the public health emergency, replace lost public sector revenue, provide premium pay to essential workers, and invest in water, sewer and broadband infrastructure. Condition: We selected forty services and supplies disbursements charged to the program and noted one disbursement in the amount of $249,999 for a Police Department taser certification plan was included in the ?address negative economic impacts caused by the public health emergency? category in the quarterly Project and Expenditure Report filed with the Department of the Treasury, which does not appear to be an allowable cost under that program category. Although this program cost appears to be allowable under the revenue loss category, the City should not have charged it to the ?address negative economic impacts? category. Questioned Costs: We are not questioning the costs, because the costs are eligible expenditures under the provision of government services of the ?replace lost public sector revenue? category and we understand the City is able to correct the reporting during the next reporting window on the Department of the Treasury reporting portal. Cause: We understand that City staff tried to select an appropriate category when coding the costs in the Project and Expenditure Report, using the descriptions available in the system, but should have included the costs in the ?replace lost public sector revenue? category. Effect: The City is not in compliance with the award terms and conditions of the Coronavirus State and Local Fiscal Recovery Funds program. Recommendation: The City should develop procedures to ensure that costs charged to the Coronavirus State and Local Fiscal Recovery Funds program are eligible costs and that those costs are reported in the correct category when reporting to the Department of the Treasury. View of Responsible Officials and Planned Corrective Actions: Please see Corrective Action Plan separately prepared by the City.
Finding Reference Number: SA2022-002 Suspension and Debarment Documentation for Contracts and Subcontracts Assistance Listing Number: 21.027 Assistance Listing Title: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Name of Federal Agency: Department of the Treasury Federal Award Identification Number: SLFRP2014 Criteria: The award terms and conditions of the Coronavirus State and Local Fiscal Recovery Funds agreement with the Department of the Treasury requires that the City comply with OMB Guidelines to Agencies on Governmentwide Debarment and Suspension (Nonprocurement), 2 C.F.R. Part 180, including the requirement to include a term or condition in all lower tier covered transactions (contracts and subcontracts described in 2 C.F.R. Part 180, subpart B) that the award is subject to 2 C.F.R. Part 180 and Treasury?s implementing regulation at 31 C.F.R. Part 19. In addition, the OMB Compliance Supplement for the Program requires that prior to entering into subawards and contracts with award funds, recipients must verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded pursuant to 31 CFR section 19.300. Condition: We selected forty-two transactions for testing and although some were exempt from the suspension and debarment procurement requirements, and we noted thirty-three contracts and two subrecipient agreements did not include a term or condition related to compliance with debarment and suspension compliance provisions. We also understand that the City did not verify that the contractors and subrecipient were not suspended, debarred, or otherwise excluded prior to entering into the agreements. We did note that as of March 29, 2023, none of the entities were included on the exclusions list on SAM.gov. Cause: We understand that staff was not aware of the requirement to include the debarment and suspension provisions in the contracts and the requirement to verify the status of contractors or subrecipients prior to entering into agreements with the entities. Effect: The City is not in compliance with the award terms and conditions and the OMB Compliance Supplement requirements of the Coronavirus State and Local Fiscal Recovery Funds program. Recommendation: The City should develop procedures to ensure compliance with debarment and suspension provisions of the grant award terms and conditions and the OMB Compliance Supplement of the Coronavirus State and Local Fiscal Recovery Funds program. View of Responsible Officials and Planned Corrective Actions: Please see Corrective Action Plan separately prepared by the City.