Finding 2023-002 – Special Tests and Provisions – Citizen Participation
Repeat Finding – See Finding 2022-003
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City failed to demonstrate compliance with citizen participation requirements at 24 CFR 91.105.
Criteria: At the time of submission to HUD for its annual grant, the grantee must certify to HUD that it has met the citizen participation requirements in 24 CFR section 91.105.
Cause: Procedures in place to ensure the City was in compliance with the citizen participation requirements were not adequate.
Effect: HUD disapproved the City’s 2023 Annual Action Plan submission as it was determined the plan was substantially incomplete and failed to include all required elements of 24 CFR Part 91.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend the City implement internal control procedures to ensure compliance with citizen participation requirements and such documentation is maintained for annual HUD submission.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-003 – Activities Allowed or Unallowed
Repeat Finding – See Finding 2022-004
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: There were not adequate internal controls in place to ensure unallowable costs were not charged to the program. Our allowability sample totaling $1,095,919 yielded the following unallowable costs charged to the Community Development Block Grant/Entitlement Grants (CDBG) program: $2,066 of expenditures that the City was unable to provide supporting documentation and $2,352 of wages in excess of actual CDBG program hours worked.
Criteria: The City is required to have controls in place to ensure only actual allowable costs are charged to federal programs and that documentation is maintained to support such charges.
Cause: The City’s procedures to ensure only allowable costs are charged to the CDBG program were not adequate and the City did not have appropriate controls in place to ensure documentation was maintained for all CDBG expenditures.
Effect: The City does not have adequate internal controls to ensure only allowable costs are charged to the CDBG program.
Repeat Finding: Yes
Questioned costs known and likely: $8,179
Recommendation: We recommend the City implement internal control procedures to ensure compliance with allowable cost requirements and that all relevant documentation is maintained.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-004 – Reporting
Repeat Finding – See Finding 2022-005
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City did not have adequate internal controls in place to ensure required reports are reviewed prior to submission.
Criteria: Pursuant to 24 CFR the grantee must accurately report amounts to HUD.
Cause: The City does not have procedures in place to ensure that SF-425 and the PR-26 reconcile to the general ledger in accordance with federal reporting requirements.
Effect: Without adequate internal controls in place, the City risks not being in compliance with HUD reporting requirements. Failure to comply with grant award requirements could jeopardize future funding.
Repeat Finding: Yes
Questioned Costs: Unknown
Recommendation: We recommend that the City implement procedures to ensure that all required reports are reconciled to the general ledger and that such reporting reflects actual expenditures for the specific reporting periods.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-002 – Special Tests and Provisions – Citizen Participation
Repeat Finding – See Finding 2022-003
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City failed to demonstrate compliance with citizen participation requirements at 24 CFR 91.105.
Criteria: At the time of submission to HUD for its annual grant, the grantee must certify to HUD that it has met the citizen participation requirements in 24 CFR section 91.105.
Cause: Procedures in place to ensure the City was in compliance with the citizen participation requirements were not adequate.
Effect: HUD disapproved the City’s 2023 Annual Action Plan submission as it was determined the plan was substantially incomplete and failed to include all required elements of 24 CFR Part 91.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend the City implement internal control procedures to ensure compliance with citizen participation requirements and such documentation is maintained for annual HUD submission.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-003 – Activities Allowed or Unallowed
Repeat Finding – See Finding 2022-004
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: There were not adequate internal controls in place to ensure unallowable costs were not charged to the program. Our allowability sample totaling $1,095,919 yielded the following unallowable costs charged to the Community Development Block Grant/Entitlement Grants (CDBG) program: $2,066 of expenditures that the City was unable to provide supporting documentation and $2,352 of wages in excess of actual CDBG program hours worked.
Criteria: The City is required to have controls in place to ensure only actual allowable costs are charged to federal programs and that documentation is maintained to support such charges.
Cause: The City’s procedures to ensure only allowable costs are charged to the CDBG program were not adequate and the City did not have appropriate controls in place to ensure documentation was maintained for all CDBG expenditures.
Effect: The City does not have adequate internal controls to ensure only allowable costs are charged to the CDBG program.
Repeat Finding: Yes
Questioned costs known and likely: $8,179
Recommendation: We recommend the City implement internal control procedures to ensure compliance with allowable cost requirements and that all relevant documentation is maintained.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-004 – Reporting
Repeat Finding – See Finding 2022-005
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City did not have adequate internal controls in place to ensure required reports are reviewed prior to submission.
Criteria: Pursuant to 24 CFR the grantee must accurately report amounts to HUD.
Cause: The City does not have procedures in place to ensure that SF-425 and the PR-26 reconcile to the general ledger in accordance with federal reporting requirements.
Effect: Without adequate internal controls in place, the City risks not being in compliance with HUD reporting requirements. Failure to comply with grant award requirements could jeopardize future funding.
Repeat Finding: Yes
Questioned Costs: Unknown
Recommendation: We recommend that the City implement procedures to ensure that all required reports are reconciled to the general ledger and that such reporting reflects actual expenditures for the specific reporting periods.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-002 – Special Tests and Provisions – Citizen Participation
Repeat Finding – See Finding 2022-003
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City failed to demonstrate compliance with citizen participation requirements at 24 CFR 91.105.
Criteria: At the time of submission to HUD for its annual grant, the grantee must certify to HUD that it has met the citizen participation requirements in 24 CFR section 91.105.
Cause: Procedures in place to ensure the City was in compliance with the citizen participation requirements were not adequate.
Effect: HUD disapproved the City’s 2023 Annual Action Plan submission as it was determined the plan was substantially incomplete and failed to include all required elements of 24 CFR Part 91.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend the City implement internal control procedures to ensure compliance with citizen participation requirements and such documentation is maintained for annual HUD submission.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-003 – Activities Allowed or Unallowed
Repeat Finding – See Finding 2022-004
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: There were not adequate internal controls in place to ensure unallowable costs were not charged to the program. Our allowability sample totaling $1,095,919 yielded the following unallowable costs charged to the Community Development Block Grant/Entitlement Grants (CDBG) program: $2,066 of expenditures that the City was unable to provide supporting documentation and $2,352 of wages in excess of actual CDBG program hours worked.
Criteria: The City is required to have controls in place to ensure only actual allowable costs are charged to federal programs and that documentation is maintained to support such charges.
Cause: The City’s procedures to ensure only allowable costs are charged to the CDBG program were not adequate and the City did not have appropriate controls in place to ensure documentation was maintained for all CDBG expenditures.
Effect: The City does not have adequate internal controls to ensure only allowable costs are charged to the CDBG program.
Repeat Finding: Yes
Questioned costs known and likely: $8,179
Recommendation: We recommend the City implement internal control procedures to ensure compliance with allowable cost requirements and that all relevant documentation is maintained.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-004 – Reporting
Repeat Finding – See Finding 2022-005
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City did not have adequate internal controls in place to ensure required reports are reviewed prior to submission.
Criteria: Pursuant to 24 CFR the grantee must accurately report amounts to HUD.
Cause: The City does not have procedures in place to ensure that SF-425 and the PR-26 reconcile to the general ledger in accordance with federal reporting requirements.
Effect: Without adequate internal controls in place, the City risks not being in compliance with HUD reporting requirements. Failure to comply with grant award requirements could jeopardize future funding.
Repeat Finding: Yes
Questioned Costs: Unknown
Recommendation: We recommend that the City implement procedures to ensure that all required reports are reconciled to the general ledger and that such reporting reflects actual expenditures for the specific reporting periods.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-002 – Special Tests and Provisions – Citizen Participation
Repeat Finding – See Finding 2022-003
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City failed to demonstrate compliance with citizen participation requirements at 24 CFR 91.105.
Criteria: At the time of submission to HUD for its annual grant, the grantee must certify to HUD that it has met the citizen participation requirements in 24 CFR section 91.105.
Cause: Procedures in place to ensure the City was in compliance with the citizen participation requirements were not adequate.
Effect: HUD disapproved the City’s 2023 Annual Action Plan submission as it was determined the plan was substantially incomplete and failed to include all required elements of 24 CFR Part 91.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend the City implement internal control procedures to ensure compliance with citizen participation requirements and such documentation is maintained for annual HUD submission.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-003 – Activities Allowed or Unallowed
Repeat Finding – See Finding 2022-004
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: There were not adequate internal controls in place to ensure unallowable costs were not charged to the program. Our allowability sample totaling $1,095,919 yielded the following unallowable costs charged to the Community Development Block Grant/Entitlement Grants (CDBG) program: $2,066 of expenditures that the City was unable to provide supporting documentation and $2,352 of wages in excess of actual CDBG program hours worked.
Criteria: The City is required to have controls in place to ensure only actual allowable costs are charged to federal programs and that documentation is maintained to support such charges.
Cause: The City’s procedures to ensure only allowable costs are charged to the CDBG program were not adequate and the City did not have appropriate controls in place to ensure documentation was maintained for all CDBG expenditures.
Effect: The City does not have adequate internal controls to ensure only allowable costs are charged to the CDBG program.
Repeat Finding: Yes
Questioned costs known and likely: $8,179
Recommendation: We recommend the City implement internal control procedures to ensure compliance with allowable cost requirements and that all relevant documentation is maintained.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-004 – Reporting
Repeat Finding – See Finding 2022-005
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City did not have adequate internal controls in place to ensure required reports are reviewed prior to submission.
Criteria: Pursuant to 24 CFR the grantee must accurately report amounts to HUD.
Cause: The City does not have procedures in place to ensure that SF-425 and the PR-26 reconcile to the general ledger in accordance with federal reporting requirements.
Effect: Without adequate internal controls in place, the City risks not being in compliance with HUD reporting requirements. Failure to comply with grant award requirements could jeopardize future funding.
Repeat Finding: Yes
Questioned Costs: Unknown
Recommendation: We recommend that the City implement procedures to ensure that all required reports are reconciled to the general ledger and that such reporting reflects actual expenditures for the specific reporting periods.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-002 – Special Tests and Provisions – Citizen Participation
Repeat Finding – See Finding 2022-003
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City failed to demonstrate compliance with citizen participation requirements at 24 CFR 91.105.
Criteria: At the time of submission to HUD for its annual grant, the grantee must certify to HUD that it has met the citizen participation requirements in 24 CFR section 91.105.
Cause: Procedures in place to ensure the City was in compliance with the citizen participation requirements were not adequate.
Effect: HUD disapproved the City’s 2023 Annual Action Plan submission as it was determined the plan was substantially incomplete and failed to include all required elements of 24 CFR Part 91.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend the City implement internal control procedures to ensure compliance with citizen participation requirements and such documentation is maintained for annual HUD submission.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-003 – Activities Allowed or Unallowed
Repeat Finding – See Finding 2022-004
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: There were not adequate internal controls in place to ensure unallowable costs were not charged to the program. Our allowability sample totaling $1,095,919 yielded the following unallowable costs charged to the Community Development Block Grant/Entitlement Grants (CDBG) program: $2,066 of expenditures that the City was unable to provide supporting documentation and $2,352 of wages in excess of actual CDBG program hours worked.
Criteria: The City is required to have controls in place to ensure only actual allowable costs are charged to federal programs and that documentation is maintained to support such charges.
Cause: The City’s procedures to ensure only allowable costs are charged to the CDBG program were not adequate and the City did not have appropriate controls in place to ensure documentation was maintained for all CDBG expenditures.
Effect: The City does not have adequate internal controls to ensure only allowable costs are charged to the CDBG program.
Repeat Finding: Yes
Questioned costs known and likely: $8,179
Recommendation: We recommend the City implement internal control procedures to ensure compliance with allowable cost requirements and that all relevant documentation is maintained.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-004 – Reporting
Repeat Finding – See Finding 2022-005
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City did not have adequate internal controls in place to ensure required reports are reviewed prior to submission.
Criteria: Pursuant to 24 CFR the grantee must accurately report amounts to HUD.
Cause: The City does not have procedures in place to ensure that SF-425 and the PR-26 reconcile to the general ledger in accordance with federal reporting requirements.
Effect: Without adequate internal controls in place, the City risks not being in compliance with HUD reporting requirements. Failure to comply with grant award requirements could jeopardize future funding.
Repeat Finding: Yes
Questioned Costs: Unknown
Recommendation: We recommend that the City implement procedures to ensure that all required reports are reconciled to the general ledger and that such reporting reflects actual expenditures for the specific reporting periods.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-002 – Special Tests and Provisions – Citizen Participation
Repeat Finding – See Finding 2022-003
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City failed to demonstrate compliance with citizen participation requirements at 24 CFR 91.105.
Criteria: At the time of submission to HUD for its annual grant, the grantee must certify to HUD that it has met the citizen participation requirements in 24 CFR section 91.105.
Cause: Procedures in place to ensure the City was in compliance with the citizen participation requirements were not adequate.
Effect: HUD disapproved the City’s 2023 Annual Action Plan submission as it was determined the plan was substantially incomplete and failed to include all required elements of 24 CFR Part 91.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend the City implement internal control procedures to ensure compliance with citizen participation requirements and such documentation is maintained for annual HUD submission.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-003 – Activities Allowed or Unallowed
Repeat Finding – See Finding 2022-004
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: There were not adequate internal controls in place to ensure unallowable costs were not charged to the program. Our allowability sample totaling $1,095,919 yielded the following unallowable costs charged to the Community Development Block Grant/Entitlement Grants (CDBG) program: $2,066 of expenditures that the City was unable to provide supporting documentation and $2,352 of wages in excess of actual CDBG program hours worked.
Criteria: The City is required to have controls in place to ensure only actual allowable costs are charged to federal programs and that documentation is maintained to support such charges.
Cause: The City’s procedures to ensure only allowable costs are charged to the CDBG program were not adequate and the City did not have appropriate controls in place to ensure documentation was maintained for all CDBG expenditures.
Effect: The City does not have adequate internal controls to ensure only allowable costs are charged to the CDBG program.
Repeat Finding: Yes
Questioned costs known and likely: $8,179
Recommendation: We recommend the City implement internal control procedures to ensure compliance with allowable cost requirements and that all relevant documentation is maintained.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-004 – Reporting
Repeat Finding – See Finding 2022-005
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City did not have adequate internal controls in place to ensure required reports are reviewed prior to submission.
Criteria: Pursuant to 24 CFR the grantee must accurately report amounts to HUD.
Cause: The City does not have procedures in place to ensure that SF-425 and the PR-26 reconcile to the general ledger in accordance with federal reporting requirements.
Effect: Without adequate internal controls in place, the City risks not being in compliance with HUD reporting requirements. Failure to comply with grant award requirements could jeopardize future funding.
Repeat Finding: Yes
Questioned Costs: Unknown
Recommendation: We recommend that the City implement procedures to ensure that all required reports are reconciled to the general ledger and that such reporting reflects actual expenditures for the specific reporting periods.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-005 – Procurement
Repeat Finding – See Finding 2022-007
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City could not provide evidence that the water main replacement project totaling $3,104,970 for the year ended December 31, 2023 followed formal procurement procedures. The water main replacement contract exceeds the Uniform Guidance formal procurement methods. In addition, in accordance with the Uniform Guidance, a purchase price from the Commonwealth of Pennsylvania COSTARS cooperative purchasing program is considered to be only one competitive price proposal and it cannot replace a full procurement process.
Criteria: In accordance with Uniform Guidance procurement requirements found in 2 CFR Part 200.318 through 200.327, the City is required to ensure that procurement methods used for purchases are appropriate based on the dollar amount of the purchase.
Cause: Procedures in place to ensure that the proper procurement process is followed were not adequate.
Effect: The City was not in compliance with the procurement requirements of the Uniform Guidance.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend that the City establish procedures to ensure that their purchasing policy follows Uniform Guidance procurement standards.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-006 – Subrecipient Monitoring
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City did not have a documented risk assessment process for evaluating subrecipient’s risk of non-compliance. Additionally, as part of the monitoring process, the City did not have controls in place to obtain and review the annual audit report of the subrecipient in a timely manner with documentation of such review.
Criteria: The 2 CFR section 200.332(b) requires pass-through entities to evaluate subrecipient risks of noncompliance as part of their subrecipient monitoring procedures. In addition, 2 CFR section 200.332(d) indicates as part of the monitoring process, the pass-through entity should ensure subrecipients take follow-up action on audit deficiencies, which would be identified as part of the review of the annual audit reports of subrecipients.
Cause: There were no procedures in place to document the City’s assessment of risk for the subrecipient. In addition, the City does not have procedures in place to adequately review the subrecipient’s audit received.
Effect: The deficiencies in subrecipient monitoring could result in the City not identifying unallowable expenses being incurred by the City’s subrecipient.
Repeat Finding: This is not a repeat finding.
Recommendation: We recommend implementation of procedures to formally document and complete a risk assessment of subrecipients. Based on the risk assessment performed, the City should develop monitoring procedures to address the risks noted, which should include a documented review of subrecipient audits and deficiencies be followed up on, if applicable.
Questioned Costs: Unknown
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-005 – Procurement
Repeat Finding – See Finding 2022-007
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City could not provide evidence that the water main replacement project totaling $3,104,970 for the year ended December 31, 2023 followed formal procurement procedures. The water main replacement contract exceeds the Uniform Guidance formal procurement methods. In addition, in accordance with the Uniform Guidance, a purchase price from the Commonwealth of Pennsylvania COSTARS cooperative purchasing program is considered to be only one competitive price proposal and it cannot replace a full procurement process.
Criteria: In accordance with Uniform Guidance procurement requirements found in 2 CFR Part 200.318 through 200.327, the City is required to ensure that procurement methods used for purchases are appropriate based on the dollar amount of the purchase.
Cause: Procedures in place to ensure that the proper procurement process is followed were not adequate.
Effect: The City was not in compliance with the procurement requirements of the Uniform Guidance.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend that the City establish procedures to ensure that their purchasing policy follows Uniform Guidance procurement standards.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-006 – Subrecipient Monitoring
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City did not have a documented risk assessment process for evaluating subrecipient’s risk of non-compliance. Additionally, as part of the monitoring process, the City did not have controls in place to obtain and review the annual audit report of the subrecipient in a timely manner with documentation of such review.
Criteria: The 2 CFR section 200.332(b) requires pass-through entities to evaluate subrecipient risks of noncompliance as part of their subrecipient monitoring procedures. In addition, 2 CFR section 200.332(d) indicates as part of the monitoring process, the pass-through entity should ensure subrecipients take follow-up action on audit deficiencies, which would be identified as part of the review of the annual audit reports of subrecipients.
Cause: There were no procedures in place to document the City’s assessment of risk for the subrecipient. In addition, the City does not have procedures in place to adequately review the subrecipient’s audit received.
Effect: The deficiencies in subrecipient monitoring could result in the City not identifying unallowable expenses being incurred by the City’s subrecipient.
Repeat Finding: This is not a repeat finding.
Recommendation: We recommend implementation of procedures to formally document and complete a risk assessment of subrecipients. Based on the risk assessment performed, the City should develop monitoring procedures to address the risks noted, which should include a documented review of subrecipient audits and deficiencies be followed up on, if applicable.
Questioned Costs: Unknown
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-005 – Procurement
Repeat Finding – See Finding 2022-007
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City could not provide evidence that the water main replacement project totaling $3,104,970 for the year ended December 31, 2023 followed formal procurement procedures. The water main replacement contract exceeds the Uniform Guidance formal procurement methods. In addition, in accordance with the Uniform Guidance, a purchase price from the Commonwealth of Pennsylvania COSTARS cooperative purchasing program is considered to be only one competitive price proposal and it cannot replace a full procurement process.
Criteria: In accordance with Uniform Guidance procurement requirements found in 2 CFR Part 200.318 through 200.327, the City is required to ensure that procurement methods used for purchases are appropriate based on the dollar amount of the purchase.
Cause: Procedures in place to ensure that the proper procurement process is followed were not adequate.
Effect: The City was not in compliance with the procurement requirements of the Uniform Guidance.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend that the City establish procedures to ensure that their purchasing policy follows Uniform Guidance procurement standards.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-006 – Subrecipient Monitoring
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City did not have a documented risk assessment process for evaluating subrecipient’s risk of non-compliance. Additionally, as part of the monitoring process, the City did not have controls in place to obtain and review the annual audit report of the subrecipient in a timely manner with documentation of such review.
Criteria: The 2 CFR section 200.332(b) requires pass-through entities to evaluate subrecipient risks of noncompliance as part of their subrecipient monitoring procedures. In addition, 2 CFR section 200.332(d) indicates as part of the monitoring process, the pass-through entity should ensure subrecipients take follow-up action on audit deficiencies, which would be identified as part of the review of the annual audit reports of subrecipients.
Cause: There were no procedures in place to document the City’s assessment of risk for the subrecipient. In addition, the City does not have procedures in place to adequately review the subrecipient’s audit received.
Effect: The deficiencies in subrecipient monitoring could result in the City not identifying unallowable expenses being incurred by the City’s subrecipient.
Repeat Finding: This is not a repeat finding.
Recommendation: We recommend implementation of procedures to formally document and complete a risk assessment of subrecipients. Based on the risk assessment performed, the City should develop monitoring procedures to address the risks noted, which should include a documented review of subrecipient audits and deficiencies be followed up on, if applicable.
Questioned Costs: Unknown
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-005 – Procurement
Repeat Finding – See Finding 2022-007
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City could not provide evidence that the water main replacement project totaling $3,104,970 for the year ended December 31, 2023 followed formal procurement procedures. The water main replacement contract exceeds the Uniform Guidance formal procurement methods. In addition, in accordance with the Uniform Guidance, a purchase price from the Commonwealth of Pennsylvania COSTARS cooperative purchasing program is considered to be only one competitive price proposal and it cannot replace a full procurement process.
Criteria: In accordance with Uniform Guidance procurement requirements found in 2 CFR Part 200.318 through 200.327, the City is required to ensure that procurement methods used for purchases are appropriate based on the dollar amount of the purchase.
Cause: Procedures in place to ensure that the proper procurement process is followed were not adequate.
Effect: The City was not in compliance with the procurement requirements of the Uniform Guidance.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend that the City establish procedures to ensure that their purchasing policy follows Uniform Guidance procurement standards.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-006 – Subrecipient Monitoring
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City did not have a documented risk assessment process for evaluating subrecipient’s risk of non-compliance. Additionally, as part of the monitoring process, the City did not have controls in place to obtain and review the annual audit report of the subrecipient in a timely manner with documentation of such review.
Criteria: The 2 CFR section 200.332(b) requires pass-through entities to evaluate subrecipient risks of noncompliance as part of their subrecipient monitoring procedures. In addition, 2 CFR section 200.332(d) indicates as part of the monitoring process, the pass-through entity should ensure subrecipients take follow-up action on audit deficiencies, which would be identified as part of the review of the annual audit reports of subrecipients.
Cause: There were no procedures in place to document the City’s assessment of risk for the subrecipient. In addition, the City does not have procedures in place to adequately review the subrecipient’s audit received.
Effect: The deficiencies in subrecipient monitoring could result in the City not identifying unallowable expenses being incurred by the City’s subrecipient.
Repeat Finding: This is not a repeat finding.
Recommendation: We recommend implementation of procedures to formally document and complete a risk assessment of subrecipients. Based on the risk assessment performed, the City should develop monitoring procedures to address the risks noted, which should include a documented review of subrecipient audits and deficiencies be followed up on, if applicable.
Questioned Costs: Unknown
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-002 – Special Tests and Provisions – Citizen Participation
Repeat Finding – See Finding 2022-003
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City failed to demonstrate compliance with citizen participation requirements at 24 CFR 91.105.
Criteria: At the time of submission to HUD for its annual grant, the grantee must certify to HUD that it has met the citizen participation requirements in 24 CFR section 91.105.
Cause: Procedures in place to ensure the City was in compliance with the citizen participation requirements were not adequate.
Effect: HUD disapproved the City’s 2023 Annual Action Plan submission as it was determined the plan was substantially incomplete and failed to include all required elements of 24 CFR Part 91.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend the City implement internal control procedures to ensure compliance with citizen participation requirements and such documentation is maintained for annual HUD submission.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-003 – Activities Allowed or Unallowed
Repeat Finding – See Finding 2022-004
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: There were not adequate internal controls in place to ensure unallowable costs were not charged to the program. Our allowability sample totaling $1,095,919 yielded the following unallowable costs charged to the Community Development Block Grant/Entitlement Grants (CDBG) program: $2,066 of expenditures that the City was unable to provide supporting documentation and $2,352 of wages in excess of actual CDBG program hours worked.
Criteria: The City is required to have controls in place to ensure only actual allowable costs are charged to federal programs and that documentation is maintained to support such charges.
Cause: The City’s procedures to ensure only allowable costs are charged to the CDBG program were not adequate and the City did not have appropriate controls in place to ensure documentation was maintained for all CDBG expenditures.
Effect: The City does not have adequate internal controls to ensure only allowable costs are charged to the CDBG program.
Repeat Finding: Yes
Questioned costs known and likely: $8,179
Recommendation: We recommend the City implement internal control procedures to ensure compliance with allowable cost requirements and that all relevant documentation is maintained.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-004 – Reporting
Repeat Finding – See Finding 2022-005
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City did not have adequate internal controls in place to ensure required reports are reviewed prior to submission.
Criteria: Pursuant to 24 CFR the grantee must accurately report amounts to HUD.
Cause: The City does not have procedures in place to ensure that SF-425 and the PR-26 reconcile to the general ledger in accordance with federal reporting requirements.
Effect: Without adequate internal controls in place, the City risks not being in compliance with HUD reporting requirements. Failure to comply with grant award requirements could jeopardize future funding.
Repeat Finding: Yes
Questioned Costs: Unknown
Recommendation: We recommend that the City implement procedures to ensure that all required reports are reconciled to the general ledger and that such reporting reflects actual expenditures for the specific reporting periods.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-002 – Special Tests and Provisions – Citizen Participation
Repeat Finding – See Finding 2022-003
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City failed to demonstrate compliance with citizen participation requirements at 24 CFR 91.105.
Criteria: At the time of submission to HUD for its annual grant, the grantee must certify to HUD that it has met the citizen participation requirements in 24 CFR section 91.105.
Cause: Procedures in place to ensure the City was in compliance with the citizen participation requirements were not adequate.
Effect: HUD disapproved the City’s 2023 Annual Action Plan submission as it was determined the plan was substantially incomplete and failed to include all required elements of 24 CFR Part 91.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend the City implement internal control procedures to ensure compliance with citizen participation requirements and such documentation is maintained for annual HUD submission.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-003 – Activities Allowed or Unallowed
Repeat Finding – See Finding 2022-004
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: There were not adequate internal controls in place to ensure unallowable costs were not charged to the program. Our allowability sample totaling $1,095,919 yielded the following unallowable costs charged to the Community Development Block Grant/Entitlement Grants (CDBG) program: $2,066 of expenditures that the City was unable to provide supporting documentation and $2,352 of wages in excess of actual CDBG program hours worked.
Criteria: The City is required to have controls in place to ensure only actual allowable costs are charged to federal programs and that documentation is maintained to support such charges.
Cause: The City’s procedures to ensure only allowable costs are charged to the CDBG program were not adequate and the City did not have appropriate controls in place to ensure documentation was maintained for all CDBG expenditures.
Effect: The City does not have adequate internal controls to ensure only allowable costs are charged to the CDBG program.
Repeat Finding: Yes
Questioned costs known and likely: $8,179
Recommendation: We recommend the City implement internal control procedures to ensure compliance with allowable cost requirements and that all relevant documentation is maintained.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-004 – Reporting
Repeat Finding – See Finding 2022-005
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City did not have adequate internal controls in place to ensure required reports are reviewed prior to submission.
Criteria: Pursuant to 24 CFR the grantee must accurately report amounts to HUD.
Cause: The City does not have procedures in place to ensure that SF-425 and the PR-26 reconcile to the general ledger in accordance with federal reporting requirements.
Effect: Without adequate internal controls in place, the City risks not being in compliance with HUD reporting requirements. Failure to comply with grant award requirements could jeopardize future funding.
Repeat Finding: Yes
Questioned Costs: Unknown
Recommendation: We recommend that the City implement procedures to ensure that all required reports are reconciled to the general ledger and that such reporting reflects actual expenditures for the specific reporting periods.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-002 – Special Tests and Provisions – Citizen Participation
Repeat Finding – See Finding 2022-003
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City failed to demonstrate compliance with citizen participation requirements at 24 CFR 91.105.
Criteria: At the time of submission to HUD for its annual grant, the grantee must certify to HUD that it has met the citizen participation requirements in 24 CFR section 91.105.
Cause: Procedures in place to ensure the City was in compliance with the citizen participation requirements were not adequate.
Effect: HUD disapproved the City’s 2023 Annual Action Plan submission as it was determined the plan was substantially incomplete and failed to include all required elements of 24 CFR Part 91.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend the City implement internal control procedures to ensure compliance with citizen participation requirements and such documentation is maintained for annual HUD submission.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-003 – Activities Allowed or Unallowed
Repeat Finding – See Finding 2022-004
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: There were not adequate internal controls in place to ensure unallowable costs were not charged to the program. Our allowability sample totaling $1,095,919 yielded the following unallowable costs charged to the Community Development Block Grant/Entitlement Grants (CDBG) program: $2,066 of expenditures that the City was unable to provide supporting documentation and $2,352 of wages in excess of actual CDBG program hours worked.
Criteria: The City is required to have controls in place to ensure only actual allowable costs are charged to federal programs and that documentation is maintained to support such charges.
Cause: The City’s procedures to ensure only allowable costs are charged to the CDBG program were not adequate and the City did not have appropriate controls in place to ensure documentation was maintained for all CDBG expenditures.
Effect: The City does not have adequate internal controls to ensure only allowable costs are charged to the CDBG program.
Repeat Finding: Yes
Questioned costs known and likely: $8,179
Recommendation: We recommend the City implement internal control procedures to ensure compliance with allowable cost requirements and that all relevant documentation is maintained.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-004 – Reporting
Repeat Finding – See Finding 2022-005
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City did not have adequate internal controls in place to ensure required reports are reviewed prior to submission.
Criteria: Pursuant to 24 CFR the grantee must accurately report amounts to HUD.
Cause: The City does not have procedures in place to ensure that SF-425 and the PR-26 reconcile to the general ledger in accordance with federal reporting requirements.
Effect: Without adequate internal controls in place, the City risks not being in compliance with HUD reporting requirements. Failure to comply with grant award requirements could jeopardize future funding.
Repeat Finding: Yes
Questioned Costs: Unknown
Recommendation: We recommend that the City implement procedures to ensure that all required reports are reconciled to the general ledger and that such reporting reflects actual expenditures for the specific reporting periods.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-002 – Special Tests and Provisions – Citizen Participation
Repeat Finding – See Finding 2022-003
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City failed to demonstrate compliance with citizen participation requirements at 24 CFR 91.105.
Criteria: At the time of submission to HUD for its annual grant, the grantee must certify to HUD that it has met the citizen participation requirements in 24 CFR section 91.105.
Cause: Procedures in place to ensure the City was in compliance with the citizen participation requirements were not adequate.
Effect: HUD disapproved the City’s 2023 Annual Action Plan submission as it was determined the plan was substantially incomplete and failed to include all required elements of 24 CFR Part 91.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend the City implement internal control procedures to ensure compliance with citizen participation requirements and such documentation is maintained for annual HUD submission.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-003 – Activities Allowed or Unallowed
Repeat Finding – See Finding 2022-004
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: There were not adequate internal controls in place to ensure unallowable costs were not charged to the program. Our allowability sample totaling $1,095,919 yielded the following unallowable costs charged to the Community Development Block Grant/Entitlement Grants (CDBG) program: $2,066 of expenditures that the City was unable to provide supporting documentation and $2,352 of wages in excess of actual CDBG program hours worked.
Criteria: The City is required to have controls in place to ensure only actual allowable costs are charged to federal programs and that documentation is maintained to support such charges.
Cause: The City’s procedures to ensure only allowable costs are charged to the CDBG program were not adequate and the City did not have appropriate controls in place to ensure documentation was maintained for all CDBG expenditures.
Effect: The City does not have adequate internal controls to ensure only allowable costs are charged to the CDBG program.
Repeat Finding: Yes
Questioned costs known and likely: $8,179
Recommendation: We recommend the City implement internal control procedures to ensure compliance with allowable cost requirements and that all relevant documentation is maintained.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-004 – Reporting
Repeat Finding – See Finding 2022-005
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City did not have adequate internal controls in place to ensure required reports are reviewed prior to submission.
Criteria: Pursuant to 24 CFR the grantee must accurately report amounts to HUD.
Cause: The City does not have procedures in place to ensure that SF-425 and the PR-26 reconcile to the general ledger in accordance with federal reporting requirements.
Effect: Without adequate internal controls in place, the City risks not being in compliance with HUD reporting requirements. Failure to comply with grant award requirements could jeopardize future funding.
Repeat Finding: Yes
Questioned Costs: Unknown
Recommendation: We recommend that the City implement procedures to ensure that all required reports are reconciled to the general ledger and that such reporting reflects actual expenditures for the specific reporting periods.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-002 – Special Tests and Provisions – Citizen Participation
Repeat Finding – See Finding 2022-003
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City failed to demonstrate compliance with citizen participation requirements at 24 CFR 91.105.
Criteria: At the time of submission to HUD for its annual grant, the grantee must certify to HUD that it has met the citizen participation requirements in 24 CFR section 91.105.
Cause: Procedures in place to ensure the City was in compliance with the citizen participation requirements were not adequate.
Effect: HUD disapproved the City’s 2023 Annual Action Plan submission as it was determined the plan was substantially incomplete and failed to include all required elements of 24 CFR Part 91.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend the City implement internal control procedures to ensure compliance with citizen participation requirements and such documentation is maintained for annual HUD submission.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-003 – Activities Allowed or Unallowed
Repeat Finding – See Finding 2022-004
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: There were not adequate internal controls in place to ensure unallowable costs were not charged to the program. Our allowability sample totaling $1,095,919 yielded the following unallowable costs charged to the Community Development Block Grant/Entitlement Grants (CDBG) program: $2,066 of expenditures that the City was unable to provide supporting documentation and $2,352 of wages in excess of actual CDBG program hours worked.
Criteria: The City is required to have controls in place to ensure only actual allowable costs are charged to federal programs and that documentation is maintained to support such charges.
Cause: The City’s procedures to ensure only allowable costs are charged to the CDBG program were not adequate and the City did not have appropriate controls in place to ensure documentation was maintained for all CDBG expenditures.
Effect: The City does not have adequate internal controls to ensure only allowable costs are charged to the CDBG program.
Repeat Finding: Yes
Questioned costs known and likely: $8,179
Recommendation: We recommend the City implement internal control procedures to ensure compliance with allowable cost requirements and that all relevant documentation is maintained.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-004 – Reporting
Repeat Finding – See Finding 2022-005
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City did not have adequate internal controls in place to ensure required reports are reviewed prior to submission.
Criteria: Pursuant to 24 CFR the grantee must accurately report amounts to HUD.
Cause: The City does not have procedures in place to ensure that SF-425 and the PR-26 reconcile to the general ledger in accordance with federal reporting requirements.
Effect: Without adequate internal controls in place, the City risks not being in compliance with HUD reporting requirements. Failure to comply with grant award requirements could jeopardize future funding.
Repeat Finding: Yes
Questioned Costs: Unknown
Recommendation: We recommend that the City implement procedures to ensure that all required reports are reconciled to the general ledger and that such reporting reflects actual expenditures for the specific reporting periods.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-002 – Special Tests and Provisions – Citizen Participation
Repeat Finding – See Finding 2022-003
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City failed to demonstrate compliance with citizen participation requirements at 24 CFR 91.105.
Criteria: At the time of submission to HUD for its annual grant, the grantee must certify to HUD that it has met the citizen participation requirements in 24 CFR section 91.105.
Cause: Procedures in place to ensure the City was in compliance with the citizen participation requirements were not adequate.
Effect: HUD disapproved the City’s 2023 Annual Action Plan submission as it was determined the plan was substantially incomplete and failed to include all required elements of 24 CFR Part 91.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend the City implement internal control procedures to ensure compliance with citizen participation requirements and such documentation is maintained for annual HUD submission.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-003 – Activities Allowed or Unallowed
Repeat Finding – See Finding 2022-004
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: There were not adequate internal controls in place to ensure unallowable costs were not charged to the program. Our allowability sample totaling $1,095,919 yielded the following unallowable costs charged to the Community Development Block Grant/Entitlement Grants (CDBG) program: $2,066 of expenditures that the City was unable to provide supporting documentation and $2,352 of wages in excess of actual CDBG program hours worked.
Criteria: The City is required to have controls in place to ensure only actual allowable costs are charged to federal programs and that documentation is maintained to support such charges.
Cause: The City’s procedures to ensure only allowable costs are charged to the CDBG program were not adequate and the City did not have appropriate controls in place to ensure documentation was maintained for all CDBG expenditures.
Effect: The City does not have adequate internal controls to ensure only allowable costs are charged to the CDBG program.
Repeat Finding: Yes
Questioned costs known and likely: $8,179
Recommendation: We recommend the City implement internal control procedures to ensure compliance with allowable cost requirements and that all relevant documentation is maintained.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-004 – Reporting
Repeat Finding – See Finding 2022-005
U.S. Department of Housing and Urban Development (HUD) – CDBG - Entitlement Grants Cluster: Community Development Block Grant/Entitlement Grants (ALN 14.218)
Condition: The City did not have adequate internal controls in place to ensure required reports are reviewed prior to submission.
Criteria: Pursuant to 24 CFR the grantee must accurately report amounts to HUD.
Cause: The City does not have procedures in place to ensure that SF-425 and the PR-26 reconcile to the general ledger in accordance with federal reporting requirements.
Effect: Without adequate internal controls in place, the City risks not being in compliance with HUD reporting requirements. Failure to comply with grant award requirements could jeopardize future funding.
Repeat Finding: Yes
Questioned Costs: Unknown
Recommendation: We recommend that the City implement procedures to ensure that all required reports are reconciled to the general ledger and that such reporting reflects actual expenditures for the specific reporting periods.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-005 – Procurement
Repeat Finding – See Finding 2022-007
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City could not provide evidence that the water main replacement project totaling $3,104,970 for the year ended December 31, 2023 followed formal procurement procedures. The water main replacement contract exceeds the Uniform Guidance formal procurement methods. In addition, in accordance with the Uniform Guidance, a purchase price from the Commonwealth of Pennsylvania COSTARS cooperative purchasing program is considered to be only one competitive price proposal and it cannot replace a full procurement process.
Criteria: In accordance with Uniform Guidance procurement requirements found in 2 CFR Part 200.318 through 200.327, the City is required to ensure that procurement methods used for purchases are appropriate based on the dollar amount of the purchase.
Cause: Procedures in place to ensure that the proper procurement process is followed were not adequate.
Effect: The City was not in compliance with the procurement requirements of the Uniform Guidance.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend that the City establish procedures to ensure that their purchasing policy follows Uniform Guidance procurement standards.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-006 – Subrecipient Monitoring
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City did not have a documented risk assessment process for evaluating subrecipient’s risk of non-compliance. Additionally, as part of the monitoring process, the City did not have controls in place to obtain and review the annual audit report of the subrecipient in a timely manner with documentation of such review.
Criteria: The 2 CFR section 200.332(b) requires pass-through entities to evaluate subrecipient risks of noncompliance as part of their subrecipient monitoring procedures. In addition, 2 CFR section 200.332(d) indicates as part of the monitoring process, the pass-through entity should ensure subrecipients take follow-up action on audit deficiencies, which would be identified as part of the review of the annual audit reports of subrecipients.
Cause: There were no procedures in place to document the City’s assessment of risk for the subrecipient. In addition, the City does not have procedures in place to adequately review the subrecipient’s audit received.
Effect: The deficiencies in subrecipient monitoring could result in the City not identifying unallowable expenses being incurred by the City’s subrecipient.
Repeat Finding: This is not a repeat finding.
Recommendation: We recommend implementation of procedures to formally document and complete a risk assessment of subrecipients. Based on the risk assessment performed, the City should develop monitoring procedures to address the risks noted, which should include a documented review of subrecipient audits and deficiencies be followed up on, if applicable.
Questioned Costs: Unknown
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-005 – Procurement
Repeat Finding – See Finding 2022-007
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City could not provide evidence that the water main replacement project totaling $3,104,970 for the year ended December 31, 2023 followed formal procurement procedures. The water main replacement contract exceeds the Uniform Guidance formal procurement methods. In addition, in accordance with the Uniform Guidance, a purchase price from the Commonwealth of Pennsylvania COSTARS cooperative purchasing program is considered to be only one competitive price proposal and it cannot replace a full procurement process.
Criteria: In accordance with Uniform Guidance procurement requirements found in 2 CFR Part 200.318 through 200.327, the City is required to ensure that procurement methods used for purchases are appropriate based on the dollar amount of the purchase.
Cause: Procedures in place to ensure that the proper procurement process is followed were not adequate.
Effect: The City was not in compliance with the procurement requirements of the Uniform Guidance.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend that the City establish procedures to ensure that their purchasing policy follows Uniform Guidance procurement standards.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-006 – Subrecipient Monitoring
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City did not have a documented risk assessment process for evaluating subrecipient’s risk of non-compliance. Additionally, as part of the monitoring process, the City did not have controls in place to obtain and review the annual audit report of the subrecipient in a timely manner with documentation of such review.
Criteria: The 2 CFR section 200.332(b) requires pass-through entities to evaluate subrecipient risks of noncompliance as part of their subrecipient monitoring procedures. In addition, 2 CFR section 200.332(d) indicates as part of the monitoring process, the pass-through entity should ensure subrecipients take follow-up action on audit deficiencies, which would be identified as part of the review of the annual audit reports of subrecipients.
Cause: There were no procedures in place to document the City’s assessment of risk for the subrecipient. In addition, the City does not have procedures in place to adequately review the subrecipient’s audit received.
Effect: The deficiencies in subrecipient monitoring could result in the City not identifying unallowable expenses being incurred by the City’s subrecipient.
Repeat Finding: This is not a repeat finding.
Recommendation: We recommend implementation of procedures to formally document and complete a risk assessment of subrecipients. Based on the risk assessment performed, the City should develop monitoring procedures to address the risks noted, which should include a documented review of subrecipient audits and deficiencies be followed up on, if applicable.
Questioned Costs: Unknown
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-005 – Procurement
Repeat Finding – See Finding 2022-007
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City could not provide evidence that the water main replacement project totaling $3,104,970 for the year ended December 31, 2023 followed formal procurement procedures. The water main replacement contract exceeds the Uniform Guidance formal procurement methods. In addition, in accordance with the Uniform Guidance, a purchase price from the Commonwealth of Pennsylvania COSTARS cooperative purchasing program is considered to be only one competitive price proposal and it cannot replace a full procurement process.
Criteria: In accordance with Uniform Guidance procurement requirements found in 2 CFR Part 200.318 through 200.327, the City is required to ensure that procurement methods used for purchases are appropriate based on the dollar amount of the purchase.
Cause: Procedures in place to ensure that the proper procurement process is followed were not adequate.
Effect: The City was not in compliance with the procurement requirements of the Uniform Guidance.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend that the City establish procedures to ensure that their purchasing policy follows Uniform Guidance procurement standards.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-006 – Subrecipient Monitoring
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City did not have a documented risk assessment process for evaluating subrecipient’s risk of non-compliance. Additionally, as part of the monitoring process, the City did not have controls in place to obtain and review the annual audit report of the subrecipient in a timely manner with documentation of such review.
Criteria: The 2 CFR section 200.332(b) requires pass-through entities to evaluate subrecipient risks of noncompliance as part of their subrecipient monitoring procedures. In addition, 2 CFR section 200.332(d) indicates as part of the monitoring process, the pass-through entity should ensure subrecipients take follow-up action on audit deficiencies, which would be identified as part of the review of the annual audit reports of subrecipients.
Cause: There were no procedures in place to document the City’s assessment of risk for the subrecipient. In addition, the City does not have procedures in place to adequately review the subrecipient’s audit received.
Effect: The deficiencies in subrecipient monitoring could result in the City not identifying unallowable expenses being incurred by the City’s subrecipient.
Repeat Finding: This is not a repeat finding.
Recommendation: We recommend implementation of procedures to formally document and complete a risk assessment of subrecipients. Based on the risk assessment performed, the City should develop monitoring procedures to address the risks noted, which should include a documented review of subrecipient audits and deficiencies be followed up on, if applicable.
Questioned Costs: Unknown
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-005 – Procurement
Repeat Finding – See Finding 2022-007
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City could not provide evidence that the water main replacement project totaling $3,104,970 for the year ended December 31, 2023 followed formal procurement procedures. The water main replacement contract exceeds the Uniform Guidance formal procurement methods. In addition, in accordance with the Uniform Guidance, a purchase price from the Commonwealth of Pennsylvania COSTARS cooperative purchasing program is considered to be only one competitive price proposal and it cannot replace a full procurement process.
Criteria: In accordance with Uniform Guidance procurement requirements found in 2 CFR Part 200.318 through 200.327, the City is required to ensure that procurement methods used for purchases are appropriate based on the dollar amount of the purchase.
Cause: Procedures in place to ensure that the proper procurement process is followed were not adequate.
Effect: The City was not in compliance with the procurement requirements of the Uniform Guidance.
Repeat Finding: Yes
Questioned costs: Unknown
Recommendation: We recommend that the City establish procedures to ensure that their purchasing policy follows Uniform Guidance procurement standards.
View of Responsible Official: The City agrees. See the corrective action plan.
Finding 2023-006 – Subrecipient Monitoring
US Department of the Treasury – COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (ARPA) (ALN 21.027)
Condition: The City did not have a documented risk assessment process for evaluating subrecipient’s risk of non-compliance. Additionally, as part of the monitoring process, the City did not have controls in place to obtain and review the annual audit report of the subrecipient in a timely manner with documentation of such review.
Criteria: The 2 CFR section 200.332(b) requires pass-through entities to evaluate subrecipient risks of noncompliance as part of their subrecipient monitoring procedures. In addition, 2 CFR section 200.332(d) indicates as part of the monitoring process, the pass-through entity should ensure subrecipients take follow-up action on audit deficiencies, which would be identified as part of the review of the annual audit reports of subrecipients.
Cause: There were no procedures in place to document the City’s assessment of risk for the subrecipient. In addition, the City does not have procedures in place to adequately review the subrecipient’s audit received.
Effect: The deficiencies in subrecipient monitoring could result in the City not identifying unallowable expenses being incurred by the City’s subrecipient.
Repeat Finding: This is not a repeat finding.
Recommendation: We recommend implementation of procedures to formally document and complete a risk assessment of subrecipients. Based on the risk assessment performed, the City should develop monitoring procedures to address the risks noted, which should include a documented review of subrecipient audits and deficiencies be followed up on, if applicable.
Questioned Costs: Unknown
View of Responsible Official: The City agrees. See the corrective action plan.