New York City Human Resources Administration (“HRA”)
Finding #: 2024-007
Funding Year(s): 9/1/2020 - 9/1/2028
HOME Investment Partnerships Program (FAL #14.239)
Contract Numbers: M-20-MC-36-0204
Federal Agency: U.S. Department of Housing and Urban Development
Type of Finding: Allowable Costs and Eligibility - Compliance and Internal Control (Significant Deficiency)
Criteria:
In accordance with 23 CFR sections 1.9, 172.11(a), 420.113(a), and 630.106(a), costs incurred under federal awards are considered allowable and reimbursable when such costs are deemed necessary and reasonable; incurred subsequent to the date of authorization to proceed and in accordance with the conditions contained in the project agreement and the plans specifications; and, not included as costs used to meet cost sharing or matching requirements, among other things.
As stipulated by 24 CFR §92.209, tenant-based rental assistance (“TBRA”) may only be provided to very low- and low-income families. The participating jurisdiction must determine that the family is very low- or low-income before the assistance is provided. During the period of assistance, the participating jurisdiction must annually determine that the family continues to be low-income. Also, the maximum monthly assistance that a participating jurisdiction may pay to, or on behalf of, a family may not exceed the difference between a rent standard for the unit size established by the participating jurisdiction and 30% of the family's monthly adjusted income. Additionally, the participating jurisdiction must disapprove a lease if the rent is not reasonable, based on rents that are charged for comparable unassisted rental units.
Additionally, as stipulated by 2 CFR Section 200.303, recipients of federal awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
The New York City Human Resources Administration (“HRA”) utilizes the Current System to assess beneficiaries’ eligibility to receive TBRA through the HOME Investment Partnerships Program (“HOME”). To assess eligibility, HRA program staff obtain income supporting documentation to determine if the household met the low-income requirement and to calculate the maximum subsidy amount to be paid by HRA. Additionally, a rent reasonableness valuation is performed which compares the current beneficiary’s rent to other rents charged for comparable units to ensure reasonableness. Upon the completion of the eligibility determination by an HRA staff member, a designated program supervisor reviews and approves the eligibility determination, subsidy amount, and tenant share within the Current System.
In the prior year, a material weakness in internal controls was identified concerning incorrect TBRA payments. Our inquiries with management during the current year revealed that no improvements were made to the operating effectiveness of this internal control process.
In fiscal 2024, total TBRA payments charged to the grant were $3,742,133, which is not material to the program overall.
Cause/Effect:
While HRA has a process in place to assess the eligibility of tenants and calculate the monthly TBRA payments on behalf of those tenants to ensure allowability of costs incurred, a comprehensive review was not consistently performed to support those determinations and calculations. As a result, costs were incurred on behalf of certain tenants that may not have met the eligibility requirements, or an incorrect amount may have been paid on their behalf.
Questioned Costs:
None noted.
Identification as a Repeat Finding:
This finding is similar to finding #2023-002, included on pages 225 through 226 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend that HRA strengthen their internal controls governing the eligibility determination and monthly TBRA payment calculation process, including creating a comprehensive review checklist to ensure each tenant meets every eligibility requirement and HRA’s portion of the TBRA payments are properly calculated, and that appropriate supervisory review and approval is consistently performed and documented prior to processing payments and charging costs to the grant.
New York City Housing Preservation & Development (“HPD”)
Finding #: 2024-005
Funding Year(s): 7/1/2023 – 6/30/2024
Section 8 Project-Based Cluster:
Section 8 Moderate Rehabilitation Single Room Occupancy (FAL #14.249)
Lower Income Housing Assistance Program – Section 8 Moderate Rehabilitation (FAL #14.856)
Contract Numbers: N/A
Federal Agency: U.S. Department of Housing and Urban Development (“HUD”)
Type of Finding: Eligibility and Reporting - Material Noncompliance and Internal Control (Material Weakness)
Criteria:
As stipulated by 24 CFR Section 880.603, prior to providing housing assistance payments (HAP) to participants, HPD must verify the eligibility of applicants by (a) obtaining signed applications; (b) conducting verifications of family income and other pertinent information; (c) documenting inspections and tenant certifications, as appropriate; and, (d) determining that tenant income did not exceed the maximum limit set by HUD. HPD must also reexamine family income and composition for each tenant at least once every 12 months to verify continued eligibility and adjust the HAP amount, as necessary. Further, the HUD 50058 form, titled Family Report is used by Public Housing Agencies (PHAs) to collect information on families receiving house assistance through the program and submission is required before the effective date of the annual recertification.
Additionally, as stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
To assess eligibility, HPD’s policy is to conduct annual recertifications of family income and composition. As part of that process, HPD sends a recertification package to the head of household, which contains documentation that the tenant must complete for verification purposes. HPD then analyzes and verifies all information included in the recertification package to determine if the tenant is eligible to continue to receive HAPs and adjust the tenant rent and HAP amounts as necessary for the following 12-month period. The HUD 50058 form is submitted upon completion of the annual recertification to update family income, composition and rent calculations.
We selected a non-statistical sample of forty (40) tenants who received HAPs under the Section 8 Project-Based Cluster during fiscal year 2024. For eighteen (18) of the tenants tested, HPD was not able to provide documentation to support that an eligibility recertification for the tenant, including a review of the HAP calculation, was performed within the previous 12 months, as required. For those eighteen (18) tenants, HPD did not submit the HUD 50058 form by the effective date of the annual recertification as required.
Cause/Effect:
While HPD has a process in place to assess the eligibility of tenants receiving HAPs under the Section 8 Project-Based Cluster, the reexamination of family income and composition was not consistently performed and HUD 50058 updated and submitted for each tenant at least once every 12 months to support the tenant’s continued eligibility to receive benefits through this program at the appropriate amounts.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-014, included on pages 250 and 251 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend that HPD strengthen their internal controls governing the eligibility requirements, including implementing a control to ensure recertifications of family income and composition are performed at least once every 12 months and the tenants HAP amount is adjusted as necessary to meet the eligibility requirements per 24 CFR sections 880.603, 881.601, 882.514, 882.808, 833.701, 884.214, 886.119, and 886.318. HUD 50058 forms should be submitted before the effective date of the annual recertification of tenants to inform HUD of updates to family income, composition and rent calculations as required.
New York City Housing Preservation & Development (“HPD”)
Finding #: 2024-005
Funding Year(s): 7/1/2023 – 6/30/2024
Section 8 Project-Based Cluster:
Section 8 Moderate Rehabilitation Single Room Occupancy (FAL #14.249)
Lower Income Housing Assistance Program – Section 8 Moderate Rehabilitation (FAL #14.856)
Contract Numbers: N/A
Federal Agency: U.S. Department of Housing and Urban Development (“HUD”)
Type of Finding: Eligibility and Reporting - Material Noncompliance and Internal Control (Material Weakness)
Criteria:
As stipulated by 24 CFR Section 880.603, prior to providing housing assistance payments (HAP) to participants, HPD must verify the eligibility of applicants by (a) obtaining signed applications; (b) conducting verifications of family income and other pertinent information; (c) documenting inspections and tenant certifications, as appropriate; and, (d) determining that tenant income did not exceed the maximum limit set by HUD. HPD must also reexamine family income and composition for each tenant at least once every 12 months to verify continued eligibility and adjust the HAP amount, as necessary. Further, the HUD 50058 form, titled Family Report is used by Public Housing Agencies (PHAs) to collect information on families receiving house assistance through the program and submission is required before the effective date of the annual recertification.
Additionally, as stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
To assess eligibility, HPD’s policy is to conduct annual recertifications of family income and composition. As part of that process, HPD sends a recertification package to the head of household, which contains documentation that the tenant must complete for verification purposes. HPD then analyzes and verifies all information included in the recertification package to determine if the tenant is eligible to continue to receive HAPs and adjust the tenant rent and HAP amounts as necessary for the following 12-month period. The HUD 50058 form is submitted upon completion of the annual recertification to update family income, composition and rent calculations.
We selected a non-statistical sample of forty (40) tenants who received HAPs under the Section 8 Project-Based Cluster during fiscal year 2024. For eighteen (18) of the tenants tested, HPD was not able to provide documentation to support that an eligibility recertification for the tenant, including a review of the HAP calculation, was performed within the previous 12 months, as required. For those eighteen (18) tenants, HPD did not submit the HUD 50058 form by the effective date of the annual recertification as required.
Cause/Effect:
While HPD has a process in place to assess the eligibility of tenants receiving HAPs under the Section 8 Project-Based Cluster, the reexamination of family income and composition was not consistently performed and HUD 50058 updated and submitted for each tenant at least once every 12 months to support the tenant’s continued eligibility to receive benefits through this program at the appropriate amounts.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-014, included on pages 250 and 251 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend that HPD strengthen their internal controls governing the eligibility requirements, including implementing a control to ensure recertifications of family income and composition are performed at least once every 12 months and the tenants HAP amount is adjusted as necessary to meet the eligibility requirements per 24 CFR sections 880.603, 881.601, 882.514, 882.808, 833.701, 884.214, 886.119, and 886.318. HUD 50058 forms should be submitted before the effective date of the annual recertification of tenants to inform HUD of updates to family income, composition and rent calculations as required.
New York City Housing Preservation & Development (“HPD”)
Finding #: 2024-004
Funding Year(s): 7/1/2023 – 6/30/2024
Housing Voucher Cluster:
Section 8 Housing Choice Vouchers (FAL #14.871)
Contract Numbers: N/A
Federal Agency: U.S. Department of Housing and Urban Development
Type of Finding: Eligibility and Special Tests and Provisions (Utility Allowance Schedule) - Material Noncompliance and Internal Control (Material Weakness)
Criteria:
As stipulated by 24 CFR Section 982.201, prior to providing housing assistance payments (HAP) to participants, HPD must verify the eligibility of applicants based on their family income and composition. Per 24 CFR section 982.516, HPD must also reexamine family income and composition for each tenant at least once every 12 months to verify continued eligibility and adjust the HAP amount, as necessary. Further, as stipulated by 24 CFR Section 982.517, HPD must maintain an up-to-date utility allowance schedule and establish procedures to properly apply the updated utility allowances to each tenant’s HAP calculations as part of the annual reexamination process.
Additionally, as stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
To assess eligibility, HPD’s policy is to conduct annual recertifications of family income and composition. As part of that process, HPD sends a recertification package to the head of household, which contains documentation that the tenant must complete for verification purposes. HPD then analyzes and verifies all information included in the recertification package to determine if the tenant is eligible to continue to receive HAPs and adjust the tenant rent and HAP amounts as necessary for the following 12-month period.
We selected a non-statistical sample of forty (40) tenants who received HAPs under the Housing Voucher Cluster during fiscal year 2024. For thirteen (13) of the tenants tested, HPD was not able to provide documentation to support that an eligibility recertification for the tenant, including a review of the utility allowance and HAP calculation, was performed within the previous 12 months, as required.
Cause/Effect:
While HPD has a process in place to assess the eligibility of tenants receiving HAPs under the Housing Voucher Cluster, the reexamination of family income and composition and utility allowance was not consistently performed at least once every 12 months to support the tenant’s continued eligibility to receive benefits through this program at the appropriate amounts.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-016, included on pages 254 and 255 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend that HPD strengthen their internal controls governing the eligibility requirements, including implementing a control to ensure recertifications of family income and composition are performed at least once every 12 months and the tenants HAP amount and tenant utility allowance is adjusted as necessary to meet the eligibility requirements per 24 CFR sections 5.230, 5.609, 982.201 and 982.516.
New York City Housing Preservation & Development (“HPD”)
Finding #: 2024-004
Funding Year(s): 7/1/2023 – 6/30/2024
Housing Voucher Cluster:
Section 8 Housing Choice Vouchers (FAL #14.871)
Contract Numbers: N/A
Federal Agency: U.S. Department of Housing and Urban Development
Type of Finding: Eligibility and Special Tests and Provisions (Utility Allowance Schedule) - Material Noncompliance and Internal Control (Material Weakness)
Criteria:
As stipulated by 24 CFR Section 982.201, prior to providing housing assistance payments (HAP) to participants, HPD must verify the eligibility of applicants based on their family income and composition. Per 24 CFR section 982.516, HPD must also reexamine family income and composition for each tenant at least once every 12 months to verify continued eligibility and adjust the HAP amount, as necessary. Further, as stipulated by 24 CFR Section 982.517, HPD must maintain an up-to-date utility allowance schedule and establish procedures to properly apply the updated utility allowances to each tenant’s HAP calculations as part of the annual reexamination process.
Additionally, as stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
To assess eligibility, HPD’s policy is to conduct annual recertifications of family income and composition. As part of that process, HPD sends a recertification package to the head of household, which contains documentation that the tenant must complete for verification purposes. HPD then analyzes and verifies all information included in the recertification package to determine if the tenant is eligible to continue to receive HAPs and adjust the tenant rent and HAP amounts as necessary for the following 12-month period.
We selected a non-statistical sample of forty (40) tenants who received HAPs under the Housing Voucher Cluster during fiscal year 2024. For thirteen (13) of the tenants tested, HPD was not able to provide documentation to support that an eligibility recertification for the tenant, including a review of the utility allowance and HAP calculation, was performed within the previous 12 months, as required.
Cause/Effect:
While HPD has a process in place to assess the eligibility of tenants receiving HAPs under the Housing Voucher Cluster, the reexamination of family income and composition and utility allowance was not consistently performed at least once every 12 months to support the tenant’s continued eligibility to receive benefits through this program at the appropriate amounts.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-016, included on pages 254 and 255 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend that HPD strengthen their internal controls governing the eligibility requirements, including implementing a control to ensure recertifications of family income and composition are performed at least once every 12 months and the tenants HAP amount and tenant utility allowance is adjusted as necessary to meet the eligibility requirements per 24 CFR sections 5.230, 5.609, 982.201 and 982.516.
New York City Department of Education (“DOE”)
Finding #: 2024-001
Funding Year(s): 7/1/2022 – 8/31/2023
Title I Grants to Local Educational Agencies (FAL #84.010)
Contract Numbers: 4R4594A01, 3R1251A01, 3R1251L01, 3R1240A01, 3R1264A01
Twenty-First Century Community Learning Centers (FAL #84.287)
Contract Numbers: 3R3915A01
English Language Acquisition Grants (FAL #84.365)
Contract Number: 3R4151C01, 3R4151A01
Supporting Effective Instruction State Grant (FAL #84.367)
Contract Numbers: 3R2664A01, 3R2651B01
Pass-Through Agency: New York State Department of Education
Federal Agency: U.S. Department of Education
Type of Finding: Reporting Compliance
Criteria:
As stipulated by the New York State Education Department (“NYSED”) Fiscal Guidelines for Federal and State Grants, program recipients are required to submit to NYSED a signed copy of the Final Expenditure Report for a Federal Project (“FS-10F”) within 90 days following the end of the grant award period.
Condition/Context:
Of the twenty-four (24) FS-10F reports submitted by the DOE during fiscal year 2024, we selected a sample of thirteen (13) FS-10F reports and found that ten (10) of the reports tested were submitted after the required due date, as follows:
• Title I Grants to Local Educational Agencies (FAL #84.010): of the eight (8) FS-10F reports tested, five (5) reports were submitted between 41 and 132 days late.
• Twenty-First Century Community Learning Centers (FAL #84.287): of the one (1) FS-10F report tested, such report was submitted 180 days late.
• English Language Acquisition Grants (FAL #84.365): of the two (2) FS-10F reports tested, the reports were submitted between 90 and 111 days late.
• Supporting Effective Instruction State Grants (FAL #84.367): of the two (2) FS-10F reports tested, both reports were submitted 90 days late.
Cause/Effect:
We were informed that due to open encumbrances which had not been fully liquidated by the FS-10F due date, the DOE was unable to complete and submit the FS-10F financial reports within the stipulated 90-day period, thus resulting in late-filed reports.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-001, included on pages 223 and 224 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend the DOE consider establishing procedures and operational practices whereby disposition of open encumbrances is accelerated such that all FS-10F expenditure reports are prepared and submitted within the required 90-day timeframe.
New York City Department of Education (“DOE”)
Finding #: 2024-001
Funding Year(s): 7/1/2022 – 8/31/2023
Title I Grants to Local Educational Agencies (FAL #84.010)
Contract Numbers: 4R4594A01, 3R1251A01, 3R1251L01, 3R1240A01, 3R1264A01
Twenty-First Century Community Learning Centers (FAL #84.287)
Contract Numbers: 3R3915A01
English Language Acquisition Grants (FAL #84.365)
Contract Number: 3R4151C01, 3R4151A01
Supporting Effective Instruction State Grant (FAL #84.367)
Contract Numbers: 3R2664A01, 3R2651B01
Pass-Through Agency: New York State Department of Education
Federal Agency: U.S. Department of Education
Type of Finding: Reporting Compliance
Criteria:
As stipulated by the New York State Education Department (“NYSED”) Fiscal Guidelines for Federal and State Grants, program recipients are required to submit to NYSED a signed copy of the Final Expenditure Report for a Federal Project (“FS-10F”) within 90 days following the end of the grant award period.
Condition/Context:
Of the twenty-four (24) FS-10F reports submitted by the DOE during fiscal year 2024, we selected a sample of thirteen (13) FS-10F reports and found that ten (10) of the reports tested were submitted after the required due date, as follows:
• Title I Grants to Local Educational Agencies (FAL #84.010): of the eight (8) FS-10F reports tested, five (5) reports were submitted between 41 and 132 days late.
• Twenty-First Century Community Learning Centers (FAL #84.287): of the one (1) FS-10F report tested, such report was submitted 180 days late.
• English Language Acquisition Grants (FAL #84.365): of the two (2) FS-10F reports tested, the reports were submitted between 90 and 111 days late.
• Supporting Effective Instruction State Grants (FAL #84.367): of the two (2) FS-10F reports tested, both reports were submitted 90 days late.
Cause/Effect:
We were informed that due to open encumbrances which had not been fully liquidated by the FS-10F due date, the DOE was unable to complete and submit the FS-10F financial reports within the stipulated 90-day period, thus resulting in late-filed reports.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-001, included on pages 223 and 224 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend the DOE consider establishing procedures and operational practices whereby disposition of open encumbrances is accelerated such that all FS-10F expenditure reports are prepared and submitted within the required 90-day timeframe.
New York City Department of Education (“DOE”)
Finding #: 2024-001
Funding Year(s): 7/1/2022 – 8/31/2023
Title I Grants to Local Educational Agencies (FAL #84.010)
Contract Numbers: 4R4594A01, 3R1251A01, 3R1251L01, 3R1240A01, 3R1264A01
Twenty-First Century Community Learning Centers (FAL #84.287)
Contract Numbers: 3R3915A01
English Language Acquisition Grants (FAL #84.365)
Contract Number: 3R4151C01, 3R4151A01
Supporting Effective Instruction State Grant (FAL #84.367)
Contract Numbers: 3R2664A01, 3R2651B01
Pass-Through Agency: New York State Department of Education
Federal Agency: U.S. Department of Education
Type of Finding: Reporting Compliance
Criteria:
As stipulated by the New York State Education Department (“NYSED”) Fiscal Guidelines for Federal and State Grants, program recipients are required to submit to NYSED a signed copy of the Final Expenditure Report for a Federal Project (“FS-10F”) within 90 days following the end of the grant award period.
Condition/Context:
Of the twenty-four (24) FS-10F reports submitted by the DOE during fiscal year 2024, we selected a sample of thirteen (13) FS-10F reports and found that ten (10) of the reports tested were submitted after the required due date, as follows:
• Title I Grants to Local Educational Agencies (FAL #84.010): of the eight (8) FS-10F reports tested, five (5) reports were submitted between 41 and 132 days late.
• Twenty-First Century Community Learning Centers (FAL #84.287): of the one (1) FS-10F report tested, such report was submitted 180 days late.
• English Language Acquisition Grants (FAL #84.365): of the two (2) FS-10F reports tested, the reports were submitted between 90 and 111 days late.
• Supporting Effective Instruction State Grants (FAL #84.367): of the two (2) FS-10F reports tested, both reports were submitted 90 days late.
Cause/Effect:
We were informed that due to open encumbrances which had not been fully liquidated by the FS-10F due date, the DOE was unable to complete and submit the FS-10F financial reports within the stipulated 90-day period, thus resulting in late-filed reports.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-001, included on pages 223 and 224 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend the DOE consider establishing procedures and operational practices whereby disposition of open encumbrances is accelerated such that all FS-10F expenditure reports are prepared and submitted within the required 90-day timeframe.
New York City Department of Education (“DOE”)
Finding #: 2024-001
Funding Year(s): 7/1/2022 – 8/31/2023
Title I Grants to Local Educational Agencies (FAL #84.010)
Contract Numbers: 4R4594A01, 3R1251A01, 3R1251L01, 3R1240A01, 3R1264A01
Twenty-First Century Community Learning Centers (FAL #84.287)
Contract Numbers: 3R3915A01
English Language Acquisition Grants (FAL #84.365)
Contract Number: 3R4151C01, 3R4151A01
Supporting Effective Instruction State Grant (FAL #84.367)
Contract Numbers: 3R2664A01, 3R2651B01
Pass-Through Agency: New York State Department of Education
Federal Agency: U.S. Department of Education
Type of Finding: Reporting Compliance
Criteria:
As stipulated by the New York State Education Department (“NYSED”) Fiscal Guidelines for Federal and State Grants, program recipients are required to submit to NYSED a signed copy of the Final Expenditure Report for a Federal Project (“FS-10F”) within 90 days following the end of the grant award period.
Condition/Context:
Of the twenty-four (24) FS-10F reports submitted by the DOE during fiscal year 2024, we selected a sample of thirteen (13) FS-10F reports and found that ten (10) of the reports tested were submitted after the required due date, as follows:
• Title I Grants to Local Educational Agencies (FAL #84.010): of the eight (8) FS-10F reports tested, five (5) reports were submitted between 41 and 132 days late.
• Twenty-First Century Community Learning Centers (FAL #84.287): of the one (1) FS-10F report tested, such report was submitted 180 days late.
• English Language Acquisition Grants (FAL #84.365): of the two (2) FS-10F reports tested, the reports were submitted between 90 and 111 days late.
• Supporting Effective Instruction State Grants (FAL #84.367): of the two (2) FS-10F reports tested, both reports were submitted 90 days late.
Cause/Effect:
We were informed that due to open encumbrances which had not been fully liquidated by the FS-10F due date, the DOE was unable to complete and submit the FS-10F financial reports within the stipulated 90-day period, thus resulting in late-filed reports.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-001, included on pages 223 and 224 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend the DOE consider establishing procedures and operational practices whereby disposition of open encumbrances is accelerated such that all FS-10F expenditure reports are prepared and submitted within the required 90-day timeframe.
New York City Department of Health and Mental Hygiene (“DOHMH”)
Finding #: 2024-002
Funding Year(s): 8/1/2019-7/31/2024, 8/1/2019-7/31/2026
Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (FAL #93.323)
Contract Numbers: 5 NU50CK000517, 6 NU50CK000517
Federal Agency: U.S. Department of Health and Human Services
Type of Finding: Reporting - Compliance and Internal Control (Significant Deficiency)
Criteria:
In accordance with the U.S. Department of Health and Human Services (“HHS”) Grants Policy Statement, reports of expenditures are required as documentation of the financial status of grants according to the official accounting records of the recipient. Financial or expenditure reporting is accomplished using the Financial Status Report (“FSR”) (SF 269 or SF 269A). The FSR is required annually, and the report must be submitted for each budget period no later than 90 days after the close of the budget period or applicable 12-month period. Additionally, performance reports are required by the terms and conditions of the federal awards.
As stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
In the prior year, a significant deficiency in internal controls was identified concerning the lack of sufficient evidence to support the review and approval of performance reports, and the submission of annual FSRs after the required reporting deadline of 90 days following the end of the budget period.
For the performance reporting requirements, our inquiries with management during the current year revealed that no improvements were made to the operating effectiveness of this internal control process over compliance.
For the FSR reporting requirement, from a non-statistical sample of six (6) annual FSRs subject to testing during fiscal year 2024, we identified four (4) FSRs that were submitted after the required reporting deadline of within 90 days following the end of the budget period.
Cause/Effect:
Although DOHMH indicated that they have established policies and procedures to ensure the accurate and timely completion and submission of required reports, we observed that appropriate reviews were not consistently performed and documented for both financial and performance reporting to ensure timely submission.
Questioned Costs:
None noted.
Identification as a Repeat Finding:
This finding is similar to finding #2023-008, included on pages 238 and 239 of the Fiscal 2023 Single Audit
report.
Recommendation:
We recommend that DOHMH enhance their internal controls over the reporting process by ensuring that all financial and special performance reports undergo documented review and approval before submission within the required timeframe.
New York City Department of Health and Mental Hygiene (“DOHMH”)
Finding #: 2024-002
Funding Year(s): 8/1/2019-7/31/2024, 8/1/2019-7/31/2026
Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (FAL #93.323)
Contract Numbers: 5 NU50CK000517, 6 NU50CK000517
Federal Agency: U.S. Department of Health and Human Services
Type of Finding: Reporting - Compliance and Internal Control (Significant Deficiency)
Criteria:
In accordance with the U.S. Department of Health and Human Services (“HHS”) Grants Policy Statement, reports of expenditures are required as documentation of the financial status of grants according to the official accounting records of the recipient. Financial or expenditure reporting is accomplished using the Financial Status Report (“FSR”) (SF 269 or SF 269A). The FSR is required annually, and the report must be submitted for each budget period no later than 90 days after the close of the budget period or applicable 12-month period. Additionally, performance reports are required by the terms and conditions of the federal awards.
As stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
In the prior year, a significant deficiency in internal controls was identified concerning the lack of sufficient evidence to support the review and approval of performance reports, and the submission of annual FSRs after the required reporting deadline of 90 days following the end of the budget period.
For the performance reporting requirements, our inquiries with management during the current year revealed that no improvements were made to the operating effectiveness of this internal control process over compliance.
For the FSR reporting requirement, from a non-statistical sample of six (6) annual FSRs subject to testing during fiscal year 2024, we identified four (4) FSRs that were submitted after the required reporting deadline of within 90 days following the end of the budget period.
Cause/Effect:
Although DOHMH indicated that they have established policies and procedures to ensure the accurate and timely completion and submission of required reports, we observed that appropriate reviews were not consistently performed and documented for both financial and performance reporting to ensure timely submission.
Questioned Costs:
None noted.
Identification as a Repeat Finding:
This finding is similar to finding #2023-008, included on pages 238 and 239 of the Fiscal 2023 Single Audit
report.
Recommendation:
We recommend that DOHMH enhance their internal controls over the reporting process by ensuring that all financial and special performance reports undergo documented review and approval before submission within the required timeframe.
New York City Department of Health and Mental Hygiene (“DOHMH”)
Finding #: 2024-002
Funding Year(s): 8/1/2019-7/31/2024, 8/1/2019-7/31/2026
Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (FAL #93.323)
Contract Numbers: 5 NU50CK000517, 6 NU50CK000517
Federal Agency: U.S. Department of Health and Human Services
Type of Finding: Reporting - Compliance and Internal Control (Significant Deficiency)
Criteria:
In accordance with the U.S. Department of Health and Human Services (“HHS”) Grants Policy Statement, reports of expenditures are required as documentation of the financial status of grants according to the official accounting records of the recipient. Financial or expenditure reporting is accomplished using the Financial Status Report (“FSR”) (SF 269 or SF 269A). The FSR is required annually, and the report must be submitted for each budget period no later than 90 days after the close of the budget period or applicable 12-month period. Additionally, performance reports are required by the terms and conditions of the federal awards.
As stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
In the prior year, a significant deficiency in internal controls was identified concerning the lack of sufficient evidence to support the review and approval of performance reports, and the submission of annual FSRs after the required reporting deadline of 90 days following the end of the budget period.
For the performance reporting requirements, our inquiries with management during the current year revealed that no improvements were made to the operating effectiveness of this internal control process over compliance.
For the FSR reporting requirement, from a non-statistical sample of six (6) annual FSRs subject to testing during fiscal year 2024, we identified four (4) FSRs that were submitted after the required reporting deadline of within 90 days following the end of the budget period.
Cause/Effect:
Although DOHMH indicated that they have established policies and procedures to ensure the accurate and timely completion and submission of required reports, we observed that appropriate reviews were not consistently performed and documented for both financial and performance reporting to ensure timely submission.
Questioned Costs:
None noted.
Identification as a Repeat Finding:
This finding is similar to finding #2023-008, included on pages 238 and 239 of the Fiscal 2023 Single Audit
report.
Recommendation:
We recommend that DOHMH enhance their internal controls over the reporting process by ensuring that all financial and special performance reports undergo documented review and approval before submission within the required timeframe.
New York City Administration for Children’s Services (“ACS”) and New York City Department of Education (“DOE”)
Finding #: 2024-003
Funding Year(s): 4/1/2023 - 9/30/2024
CCDF Cluster: Child Care and Development Block Grant (FAL #93.575)
Contract Numbers: 23-OCFS-LCM-12-R3
Pass-Through Agency: NYS Office of Children and Family Services
Federal Agency: U.S. Department of Health and Human Services
Type of Finding: Eligibility - Material Noncompliance and Internal Control (Material Weakness)
Criteria:
As stipulated by the 45 CFR Part 98 Subpart C, to be eligible for services under the Child Care and Development Block Grant (“CCDBG”), a child shall (1) be under the age of thirteen (13) years of age or be under the age of nineteen (19) and physically or mentally incapable of caring for himself or herself; (2) Reside with a family whose income does not exceed 85 percent of the State's median income (SMI) and whose family assets do not exceed $1,000,000; and (3) reside with a parent or parents who are working or attending a job training or educational program; or receive, or need to receive, protective services.
Additionally, as stipulated by 2 CFR Section 200.303, recipients of federal awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
We selected a non-statistical sample of forty (40) individuals who received services under CCDBG during fiscal year 2024 and found that seven (7) of the individuals tested had errors, detailed as follows:
• One (1) of the individuals tested from DOE did not meet some or all of the eligibility criteria as stipulated in 45 CFR Part 98 Subpart C;
• For six (6) of the individuals tested, ACS paid for hours of care that exceeded the number of hours of care that the individual was eligible to receive based on the authorized hours determined during the eligibility approval process.
Total CCDBG Benefits charged to the grant were $813,778,977 and total CCDBG benefits subjected to testing were $36,043.
Cause/Effect:
While ACS and DOE have a process in place to assess the eligibility of children, a comprehensive review was not consistently performed and documented to ensure the appropriate evidence and related approvals were maintained to support those determinations. This was due to a lack of a process ensuring enrollment and payment for services on behalf of the children were based on and agreed to the authorized hours determined during the eligibility review process. As a result, costs were incurred on behalf of certain children that did not meet all of the eligibility requirements, were not supported by appropriate documentation, or had errors in authorized hours.
Questioned Costs:
Known questioned costs of $4,199.
Identification as a Repeat Finding:
This finding is similar to finding #2023-013, included on pages 248 and 249 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend that ACS and DOE enhance their internal controls for eligibility requirements. This includes implementing a review checklist to ensure each child meets all eligibility criteria as outlined in 45 CFR Part 98 Subpart C during the eligibility determination process.
New York City Administration for Children’s Services (“ACS”) and New York City Department of Education (“DOE”)
Finding #: 2024-003
Funding Year(s): 4/1/2023 - 9/30/2024
CCDF Cluster: Child Care and Development Block Grant (FAL #93.575)
Contract Numbers: 23-OCFS-LCM-12-R3
Pass-Through Agency: NYS Office of Children and Family Services
Federal Agency: U.S. Department of Health and Human Services
Type of Finding: Eligibility - Material Noncompliance and Internal Control (Material Weakness)
Criteria:
As stipulated by the 45 CFR Part 98 Subpart C, to be eligible for services under the Child Care and Development Block Grant (“CCDBG”), a child shall (1) be under the age of thirteen (13) years of age or be under the age of nineteen (19) and physically or mentally incapable of caring for himself or herself; (2) Reside with a family whose income does not exceed 85 percent of the State's median income (SMI) and whose family assets do not exceed $1,000,000; and (3) reside with a parent or parents who are working or attending a job training or educational program; or receive, or need to receive, protective services.
Additionally, as stipulated by 2 CFR Section 200.303, recipients of federal awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
We selected a non-statistical sample of forty (40) individuals who received services under CCDBG during fiscal year 2024 and found that seven (7) of the individuals tested had errors, detailed as follows:
• One (1) of the individuals tested from DOE did not meet some or all of the eligibility criteria as stipulated in 45 CFR Part 98 Subpart C;
• For six (6) of the individuals tested, ACS paid for hours of care that exceeded the number of hours of care that the individual was eligible to receive based on the authorized hours determined during the eligibility approval process.
Total CCDBG Benefits charged to the grant were $813,778,977 and total CCDBG benefits subjected to testing were $36,043.
Cause/Effect:
While ACS and DOE have a process in place to assess the eligibility of children, a comprehensive review was not consistently performed and documented to ensure the appropriate evidence and related approvals were maintained to support those determinations. This was due to a lack of a process ensuring enrollment and payment for services on behalf of the children were based on and agreed to the authorized hours determined during the eligibility review process. As a result, costs were incurred on behalf of certain children that did not meet all of the eligibility requirements, were not supported by appropriate documentation, or had errors in authorized hours.
Questioned Costs:
Known questioned costs of $4,199.
Identification as a Repeat Finding:
This finding is similar to finding #2023-013, included on pages 248 and 249 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend that ACS and DOE enhance their internal controls for eligibility requirements. This includes implementing a review checklist to ensure each child meets all eligibility criteria as outlined in 45 CFR Part 98 Subpart C during the eligibility determination process.
New York City Police Department (“NYPD”)
Finding #: 2024-006
Funding Year(s): 9/1/2019-8/31/2026
Rail and Transit Security Grant Program (FAL #97.075)
Contract Number(s): EMW-2019-RA-00004, EMW-2020-RA-00005, EMW-2021-RA-00004, EMW- EMW-2022-RA-00006, EMW-2023-RA-00003
Federal Agency: U.S. Department of Homeland Security
Type of Finding: Equipment and Real Property Management - Compliance and Internal Control (Significant Deficiency)
Criteria:
In accordance with 2 CFR section 200.313(d)(1), property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property.
Condition/Context:
The New York City Police Department (“NYPD”) utilizes the City’s Grants Tracking System (“GTS”), a citywide web-based inventory program, designed to standardize the tracking of federally funded equipment. Further, NYPD Command-designated grants coordinators are responsible for monitoring the equipment and updating the inventory on a periodic basis in accordance with federal guidelines. The NYPD Grants Unit periodically generates an inventory listing from GTS that includes the biennial inventory count due date for each item and distributes it to the assigned NYPD Command designated grant coordinators to ensure the inventory count is conducted timely and in accordance with federal requirements. After the completion of biennial inventory count, the NYPD Command-designated grants coordinators update the inventory count information to GTS.
From a non-statistical sample of thirteen (13) pieces of equipment subjected to testing, we identified one (1) piece of equipment that was disposed of prior to the most recent inventory count, but the equipment was not removed from the active inventory listing.
Cause/Effect:
While NYPD had certain procedures in place to monitor their equipment purchased with Federal funding, such procedures were not adequate to ensure that each aspect of the equipment and real property management compliance requirements were performed and documented within the required timeframe, which resulted in the finding noted above. Without the appropriate internal controls and monitoring procedures in place, federally funded equipment could be inaccurately recorded on inventory records and not discovered and corrected timely, inventory could be misplaced, misappropriated, or otherwise disposed of outside of the requirements of the federal guidelines.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This is not a repeat finding.
Recommendation:
We recommend that NYPD strengthen controls over the inventory process to ensure dispositions of equipment are updated in the equipment records.
New York City Human Resources Administration (“HRA”)
Finding #: 2024-007
Funding Year(s): 9/1/2020 - 9/1/2028
HOME Investment Partnerships Program (FAL #14.239)
Contract Numbers: M-20-MC-36-0204
Federal Agency: U.S. Department of Housing and Urban Development
Type of Finding: Allowable Costs and Eligibility - Compliance and Internal Control (Significant Deficiency)
Criteria:
In accordance with 23 CFR sections 1.9, 172.11(a), 420.113(a), and 630.106(a), costs incurred under federal awards are considered allowable and reimbursable when such costs are deemed necessary and reasonable; incurred subsequent to the date of authorization to proceed and in accordance with the conditions contained in the project agreement and the plans specifications; and, not included as costs used to meet cost sharing or matching requirements, among other things.
As stipulated by 24 CFR §92.209, tenant-based rental assistance (“TBRA”) may only be provided to very low- and low-income families. The participating jurisdiction must determine that the family is very low- or low-income before the assistance is provided. During the period of assistance, the participating jurisdiction must annually determine that the family continues to be low-income. Also, the maximum monthly assistance that a participating jurisdiction may pay to, or on behalf of, a family may not exceed the difference between a rent standard for the unit size established by the participating jurisdiction and 30% of the family's monthly adjusted income. Additionally, the participating jurisdiction must disapprove a lease if the rent is not reasonable, based on rents that are charged for comparable unassisted rental units.
Additionally, as stipulated by 2 CFR Section 200.303, recipients of federal awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
The New York City Human Resources Administration (“HRA”) utilizes the Current System to assess beneficiaries’ eligibility to receive TBRA through the HOME Investment Partnerships Program (“HOME”). To assess eligibility, HRA program staff obtain income supporting documentation to determine if the household met the low-income requirement and to calculate the maximum subsidy amount to be paid by HRA. Additionally, a rent reasonableness valuation is performed which compares the current beneficiary’s rent to other rents charged for comparable units to ensure reasonableness. Upon the completion of the eligibility determination by an HRA staff member, a designated program supervisor reviews and approves the eligibility determination, subsidy amount, and tenant share within the Current System.
In the prior year, a material weakness in internal controls was identified concerning incorrect TBRA payments. Our inquiries with management during the current year revealed that no improvements were made to the operating effectiveness of this internal control process.
In fiscal 2024, total TBRA payments charged to the grant were $3,742,133, which is not material to the program overall.
Cause/Effect:
While HRA has a process in place to assess the eligibility of tenants and calculate the monthly TBRA payments on behalf of those tenants to ensure allowability of costs incurred, a comprehensive review was not consistently performed to support those determinations and calculations. As a result, costs were incurred on behalf of certain tenants that may not have met the eligibility requirements, or an incorrect amount may have been paid on their behalf.
Questioned Costs:
None noted.
Identification as a Repeat Finding:
This finding is similar to finding #2023-002, included on pages 225 through 226 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend that HRA strengthen their internal controls governing the eligibility determination and monthly TBRA payment calculation process, including creating a comprehensive review checklist to ensure each tenant meets every eligibility requirement and HRA’s portion of the TBRA payments are properly calculated, and that appropriate supervisory review and approval is consistently performed and documented prior to processing payments and charging costs to the grant.
New York City Housing Preservation & Development (“HPD”)
Finding #: 2024-005
Funding Year(s): 7/1/2023 – 6/30/2024
Section 8 Project-Based Cluster:
Section 8 Moderate Rehabilitation Single Room Occupancy (FAL #14.249)
Lower Income Housing Assistance Program – Section 8 Moderate Rehabilitation (FAL #14.856)
Contract Numbers: N/A
Federal Agency: U.S. Department of Housing and Urban Development (“HUD”)
Type of Finding: Eligibility and Reporting - Material Noncompliance and Internal Control (Material Weakness)
Criteria:
As stipulated by 24 CFR Section 880.603, prior to providing housing assistance payments (HAP) to participants, HPD must verify the eligibility of applicants by (a) obtaining signed applications; (b) conducting verifications of family income and other pertinent information; (c) documenting inspections and tenant certifications, as appropriate; and, (d) determining that tenant income did not exceed the maximum limit set by HUD. HPD must also reexamine family income and composition for each tenant at least once every 12 months to verify continued eligibility and adjust the HAP amount, as necessary. Further, the HUD 50058 form, titled Family Report is used by Public Housing Agencies (PHAs) to collect information on families receiving house assistance through the program and submission is required before the effective date of the annual recertification.
Additionally, as stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
To assess eligibility, HPD’s policy is to conduct annual recertifications of family income and composition. As part of that process, HPD sends a recertification package to the head of household, which contains documentation that the tenant must complete for verification purposes. HPD then analyzes and verifies all information included in the recertification package to determine if the tenant is eligible to continue to receive HAPs and adjust the tenant rent and HAP amounts as necessary for the following 12-month period. The HUD 50058 form is submitted upon completion of the annual recertification to update family income, composition and rent calculations.
We selected a non-statistical sample of forty (40) tenants who received HAPs under the Section 8 Project-Based Cluster during fiscal year 2024. For eighteen (18) of the tenants tested, HPD was not able to provide documentation to support that an eligibility recertification for the tenant, including a review of the HAP calculation, was performed within the previous 12 months, as required. For those eighteen (18) tenants, HPD did not submit the HUD 50058 form by the effective date of the annual recertification as required.
Cause/Effect:
While HPD has a process in place to assess the eligibility of tenants receiving HAPs under the Section 8 Project-Based Cluster, the reexamination of family income and composition was not consistently performed and HUD 50058 updated and submitted for each tenant at least once every 12 months to support the tenant’s continued eligibility to receive benefits through this program at the appropriate amounts.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-014, included on pages 250 and 251 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend that HPD strengthen their internal controls governing the eligibility requirements, including implementing a control to ensure recertifications of family income and composition are performed at least once every 12 months and the tenants HAP amount is adjusted as necessary to meet the eligibility requirements per 24 CFR sections 880.603, 881.601, 882.514, 882.808, 833.701, 884.214, 886.119, and 886.318. HUD 50058 forms should be submitted before the effective date of the annual recertification of tenants to inform HUD of updates to family income, composition and rent calculations as required.
New York City Housing Preservation & Development (“HPD”)
Finding #: 2024-005
Funding Year(s): 7/1/2023 – 6/30/2024
Section 8 Project-Based Cluster:
Section 8 Moderate Rehabilitation Single Room Occupancy (FAL #14.249)
Lower Income Housing Assistance Program – Section 8 Moderate Rehabilitation (FAL #14.856)
Contract Numbers: N/A
Federal Agency: U.S. Department of Housing and Urban Development (“HUD”)
Type of Finding: Eligibility and Reporting - Material Noncompliance and Internal Control (Material Weakness)
Criteria:
As stipulated by 24 CFR Section 880.603, prior to providing housing assistance payments (HAP) to participants, HPD must verify the eligibility of applicants by (a) obtaining signed applications; (b) conducting verifications of family income and other pertinent information; (c) documenting inspections and tenant certifications, as appropriate; and, (d) determining that tenant income did not exceed the maximum limit set by HUD. HPD must also reexamine family income and composition for each tenant at least once every 12 months to verify continued eligibility and adjust the HAP amount, as necessary. Further, the HUD 50058 form, titled Family Report is used by Public Housing Agencies (PHAs) to collect information on families receiving house assistance through the program and submission is required before the effective date of the annual recertification.
Additionally, as stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
To assess eligibility, HPD’s policy is to conduct annual recertifications of family income and composition. As part of that process, HPD sends a recertification package to the head of household, which contains documentation that the tenant must complete for verification purposes. HPD then analyzes and verifies all information included in the recertification package to determine if the tenant is eligible to continue to receive HAPs and adjust the tenant rent and HAP amounts as necessary for the following 12-month period. The HUD 50058 form is submitted upon completion of the annual recertification to update family income, composition and rent calculations.
We selected a non-statistical sample of forty (40) tenants who received HAPs under the Section 8 Project-Based Cluster during fiscal year 2024. For eighteen (18) of the tenants tested, HPD was not able to provide documentation to support that an eligibility recertification for the tenant, including a review of the HAP calculation, was performed within the previous 12 months, as required. For those eighteen (18) tenants, HPD did not submit the HUD 50058 form by the effective date of the annual recertification as required.
Cause/Effect:
While HPD has a process in place to assess the eligibility of tenants receiving HAPs under the Section 8 Project-Based Cluster, the reexamination of family income and composition was not consistently performed and HUD 50058 updated and submitted for each tenant at least once every 12 months to support the tenant’s continued eligibility to receive benefits through this program at the appropriate amounts.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-014, included on pages 250 and 251 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend that HPD strengthen their internal controls governing the eligibility requirements, including implementing a control to ensure recertifications of family income and composition are performed at least once every 12 months and the tenants HAP amount is adjusted as necessary to meet the eligibility requirements per 24 CFR sections 880.603, 881.601, 882.514, 882.808, 833.701, 884.214, 886.119, and 886.318. HUD 50058 forms should be submitted before the effective date of the annual recertification of tenants to inform HUD of updates to family income, composition and rent calculations as required.
New York City Housing Preservation & Development (“HPD”)
Finding #: 2024-004
Funding Year(s): 7/1/2023 – 6/30/2024
Housing Voucher Cluster:
Section 8 Housing Choice Vouchers (FAL #14.871)
Contract Numbers: N/A
Federal Agency: U.S. Department of Housing and Urban Development
Type of Finding: Eligibility and Special Tests and Provisions (Utility Allowance Schedule) - Material Noncompliance and Internal Control (Material Weakness)
Criteria:
As stipulated by 24 CFR Section 982.201, prior to providing housing assistance payments (HAP) to participants, HPD must verify the eligibility of applicants based on their family income and composition. Per 24 CFR section 982.516, HPD must also reexamine family income and composition for each tenant at least once every 12 months to verify continued eligibility and adjust the HAP amount, as necessary. Further, as stipulated by 24 CFR Section 982.517, HPD must maintain an up-to-date utility allowance schedule and establish procedures to properly apply the updated utility allowances to each tenant’s HAP calculations as part of the annual reexamination process.
Additionally, as stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
To assess eligibility, HPD’s policy is to conduct annual recertifications of family income and composition. As part of that process, HPD sends a recertification package to the head of household, which contains documentation that the tenant must complete for verification purposes. HPD then analyzes and verifies all information included in the recertification package to determine if the tenant is eligible to continue to receive HAPs and adjust the tenant rent and HAP amounts as necessary for the following 12-month period.
We selected a non-statistical sample of forty (40) tenants who received HAPs under the Housing Voucher Cluster during fiscal year 2024. For thirteen (13) of the tenants tested, HPD was not able to provide documentation to support that an eligibility recertification for the tenant, including a review of the utility allowance and HAP calculation, was performed within the previous 12 months, as required.
Cause/Effect:
While HPD has a process in place to assess the eligibility of tenants receiving HAPs under the Housing Voucher Cluster, the reexamination of family income and composition and utility allowance was not consistently performed at least once every 12 months to support the tenant’s continued eligibility to receive benefits through this program at the appropriate amounts.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-016, included on pages 254 and 255 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend that HPD strengthen their internal controls governing the eligibility requirements, including implementing a control to ensure recertifications of family income and composition are performed at least once every 12 months and the tenants HAP amount and tenant utility allowance is adjusted as necessary to meet the eligibility requirements per 24 CFR sections 5.230, 5.609, 982.201 and 982.516.
New York City Housing Preservation & Development (“HPD”)
Finding #: 2024-004
Funding Year(s): 7/1/2023 – 6/30/2024
Housing Voucher Cluster:
Section 8 Housing Choice Vouchers (FAL #14.871)
Contract Numbers: N/A
Federal Agency: U.S. Department of Housing and Urban Development
Type of Finding: Eligibility and Special Tests and Provisions (Utility Allowance Schedule) - Material Noncompliance and Internal Control (Material Weakness)
Criteria:
As stipulated by 24 CFR Section 982.201, prior to providing housing assistance payments (HAP) to participants, HPD must verify the eligibility of applicants based on their family income and composition. Per 24 CFR section 982.516, HPD must also reexamine family income and composition for each tenant at least once every 12 months to verify continued eligibility and adjust the HAP amount, as necessary. Further, as stipulated by 24 CFR Section 982.517, HPD must maintain an up-to-date utility allowance schedule and establish procedures to properly apply the updated utility allowances to each tenant’s HAP calculations as part of the annual reexamination process.
Additionally, as stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
To assess eligibility, HPD’s policy is to conduct annual recertifications of family income and composition. As part of that process, HPD sends a recertification package to the head of household, which contains documentation that the tenant must complete for verification purposes. HPD then analyzes and verifies all information included in the recertification package to determine if the tenant is eligible to continue to receive HAPs and adjust the tenant rent and HAP amounts as necessary for the following 12-month period.
We selected a non-statistical sample of forty (40) tenants who received HAPs under the Housing Voucher Cluster during fiscal year 2024. For thirteen (13) of the tenants tested, HPD was not able to provide documentation to support that an eligibility recertification for the tenant, including a review of the utility allowance and HAP calculation, was performed within the previous 12 months, as required.
Cause/Effect:
While HPD has a process in place to assess the eligibility of tenants receiving HAPs under the Housing Voucher Cluster, the reexamination of family income and composition and utility allowance was not consistently performed at least once every 12 months to support the tenant’s continued eligibility to receive benefits through this program at the appropriate amounts.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-016, included on pages 254 and 255 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend that HPD strengthen their internal controls governing the eligibility requirements, including implementing a control to ensure recertifications of family income and composition are performed at least once every 12 months and the tenants HAP amount and tenant utility allowance is adjusted as necessary to meet the eligibility requirements per 24 CFR sections 5.230, 5.609, 982.201 and 982.516.
New York City Department of Education (“DOE”)
Finding #: 2024-001
Funding Year(s): 7/1/2022 – 8/31/2023
Title I Grants to Local Educational Agencies (FAL #84.010)
Contract Numbers: 4R4594A01, 3R1251A01, 3R1251L01, 3R1240A01, 3R1264A01
Twenty-First Century Community Learning Centers (FAL #84.287)
Contract Numbers: 3R3915A01
English Language Acquisition Grants (FAL #84.365)
Contract Number: 3R4151C01, 3R4151A01
Supporting Effective Instruction State Grant (FAL #84.367)
Contract Numbers: 3R2664A01, 3R2651B01
Pass-Through Agency: New York State Department of Education
Federal Agency: U.S. Department of Education
Type of Finding: Reporting Compliance
Criteria:
As stipulated by the New York State Education Department (“NYSED”) Fiscal Guidelines for Federal and State Grants, program recipients are required to submit to NYSED a signed copy of the Final Expenditure Report for a Federal Project (“FS-10F”) within 90 days following the end of the grant award period.
Condition/Context:
Of the twenty-four (24) FS-10F reports submitted by the DOE during fiscal year 2024, we selected a sample of thirteen (13) FS-10F reports and found that ten (10) of the reports tested were submitted after the required due date, as follows:
• Title I Grants to Local Educational Agencies (FAL #84.010): of the eight (8) FS-10F reports tested, five (5) reports were submitted between 41 and 132 days late.
• Twenty-First Century Community Learning Centers (FAL #84.287): of the one (1) FS-10F report tested, such report was submitted 180 days late.
• English Language Acquisition Grants (FAL #84.365): of the two (2) FS-10F reports tested, the reports were submitted between 90 and 111 days late.
• Supporting Effective Instruction State Grants (FAL #84.367): of the two (2) FS-10F reports tested, both reports were submitted 90 days late.
Cause/Effect:
We were informed that due to open encumbrances which had not been fully liquidated by the FS-10F due date, the DOE was unable to complete and submit the FS-10F financial reports within the stipulated 90-day period, thus resulting in late-filed reports.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-001, included on pages 223 and 224 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend the DOE consider establishing procedures and operational practices whereby disposition of open encumbrances is accelerated such that all FS-10F expenditure reports are prepared and submitted within the required 90-day timeframe.
New York City Department of Education (“DOE”)
Finding #: 2024-001
Funding Year(s): 7/1/2022 – 8/31/2023
Title I Grants to Local Educational Agencies (FAL #84.010)
Contract Numbers: 4R4594A01, 3R1251A01, 3R1251L01, 3R1240A01, 3R1264A01
Twenty-First Century Community Learning Centers (FAL #84.287)
Contract Numbers: 3R3915A01
English Language Acquisition Grants (FAL #84.365)
Contract Number: 3R4151C01, 3R4151A01
Supporting Effective Instruction State Grant (FAL #84.367)
Contract Numbers: 3R2664A01, 3R2651B01
Pass-Through Agency: New York State Department of Education
Federal Agency: U.S. Department of Education
Type of Finding: Reporting Compliance
Criteria:
As stipulated by the New York State Education Department (“NYSED”) Fiscal Guidelines for Federal and State Grants, program recipients are required to submit to NYSED a signed copy of the Final Expenditure Report for a Federal Project (“FS-10F”) within 90 days following the end of the grant award period.
Condition/Context:
Of the twenty-four (24) FS-10F reports submitted by the DOE during fiscal year 2024, we selected a sample of thirteen (13) FS-10F reports and found that ten (10) of the reports tested were submitted after the required due date, as follows:
• Title I Grants to Local Educational Agencies (FAL #84.010): of the eight (8) FS-10F reports tested, five (5) reports were submitted between 41 and 132 days late.
• Twenty-First Century Community Learning Centers (FAL #84.287): of the one (1) FS-10F report tested, such report was submitted 180 days late.
• English Language Acquisition Grants (FAL #84.365): of the two (2) FS-10F reports tested, the reports were submitted between 90 and 111 days late.
• Supporting Effective Instruction State Grants (FAL #84.367): of the two (2) FS-10F reports tested, both reports were submitted 90 days late.
Cause/Effect:
We were informed that due to open encumbrances which had not been fully liquidated by the FS-10F due date, the DOE was unable to complete and submit the FS-10F financial reports within the stipulated 90-day period, thus resulting in late-filed reports.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-001, included on pages 223 and 224 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend the DOE consider establishing procedures and operational practices whereby disposition of open encumbrances is accelerated such that all FS-10F expenditure reports are prepared and submitted within the required 90-day timeframe.
New York City Department of Education (“DOE”)
Finding #: 2024-001
Funding Year(s): 7/1/2022 – 8/31/2023
Title I Grants to Local Educational Agencies (FAL #84.010)
Contract Numbers: 4R4594A01, 3R1251A01, 3R1251L01, 3R1240A01, 3R1264A01
Twenty-First Century Community Learning Centers (FAL #84.287)
Contract Numbers: 3R3915A01
English Language Acquisition Grants (FAL #84.365)
Contract Number: 3R4151C01, 3R4151A01
Supporting Effective Instruction State Grant (FAL #84.367)
Contract Numbers: 3R2664A01, 3R2651B01
Pass-Through Agency: New York State Department of Education
Federal Agency: U.S. Department of Education
Type of Finding: Reporting Compliance
Criteria:
As stipulated by the New York State Education Department (“NYSED”) Fiscal Guidelines for Federal and State Grants, program recipients are required to submit to NYSED a signed copy of the Final Expenditure Report for a Federal Project (“FS-10F”) within 90 days following the end of the grant award period.
Condition/Context:
Of the twenty-four (24) FS-10F reports submitted by the DOE during fiscal year 2024, we selected a sample of thirteen (13) FS-10F reports and found that ten (10) of the reports tested were submitted after the required due date, as follows:
• Title I Grants to Local Educational Agencies (FAL #84.010): of the eight (8) FS-10F reports tested, five (5) reports were submitted between 41 and 132 days late.
• Twenty-First Century Community Learning Centers (FAL #84.287): of the one (1) FS-10F report tested, such report was submitted 180 days late.
• English Language Acquisition Grants (FAL #84.365): of the two (2) FS-10F reports tested, the reports were submitted between 90 and 111 days late.
• Supporting Effective Instruction State Grants (FAL #84.367): of the two (2) FS-10F reports tested, both reports were submitted 90 days late.
Cause/Effect:
We were informed that due to open encumbrances which had not been fully liquidated by the FS-10F due date, the DOE was unable to complete and submit the FS-10F financial reports within the stipulated 90-day period, thus resulting in late-filed reports.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-001, included on pages 223 and 224 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend the DOE consider establishing procedures and operational practices whereby disposition of open encumbrances is accelerated such that all FS-10F expenditure reports are prepared and submitted within the required 90-day timeframe.
New York City Department of Education (“DOE”)
Finding #: 2024-001
Funding Year(s): 7/1/2022 – 8/31/2023
Title I Grants to Local Educational Agencies (FAL #84.010)
Contract Numbers: 4R4594A01, 3R1251A01, 3R1251L01, 3R1240A01, 3R1264A01
Twenty-First Century Community Learning Centers (FAL #84.287)
Contract Numbers: 3R3915A01
English Language Acquisition Grants (FAL #84.365)
Contract Number: 3R4151C01, 3R4151A01
Supporting Effective Instruction State Grant (FAL #84.367)
Contract Numbers: 3R2664A01, 3R2651B01
Pass-Through Agency: New York State Department of Education
Federal Agency: U.S. Department of Education
Type of Finding: Reporting Compliance
Criteria:
As stipulated by the New York State Education Department (“NYSED”) Fiscal Guidelines for Federal and State Grants, program recipients are required to submit to NYSED a signed copy of the Final Expenditure Report for a Federal Project (“FS-10F”) within 90 days following the end of the grant award period.
Condition/Context:
Of the twenty-four (24) FS-10F reports submitted by the DOE during fiscal year 2024, we selected a sample of thirteen (13) FS-10F reports and found that ten (10) of the reports tested were submitted after the required due date, as follows:
• Title I Grants to Local Educational Agencies (FAL #84.010): of the eight (8) FS-10F reports tested, five (5) reports were submitted between 41 and 132 days late.
• Twenty-First Century Community Learning Centers (FAL #84.287): of the one (1) FS-10F report tested, such report was submitted 180 days late.
• English Language Acquisition Grants (FAL #84.365): of the two (2) FS-10F reports tested, the reports were submitted between 90 and 111 days late.
• Supporting Effective Instruction State Grants (FAL #84.367): of the two (2) FS-10F reports tested, both reports were submitted 90 days late.
Cause/Effect:
We were informed that due to open encumbrances which had not been fully liquidated by the FS-10F due date, the DOE was unable to complete and submit the FS-10F financial reports within the stipulated 90-day period, thus resulting in late-filed reports.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This finding is similar to finding #2023-001, included on pages 223 and 224 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend the DOE consider establishing procedures and operational practices whereby disposition of open encumbrances is accelerated such that all FS-10F expenditure reports are prepared and submitted within the required 90-day timeframe.
New York City Department of Health and Mental Hygiene (“DOHMH”)
Finding #: 2024-002
Funding Year(s): 8/1/2019-7/31/2024, 8/1/2019-7/31/2026
Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (FAL #93.323)
Contract Numbers: 5 NU50CK000517, 6 NU50CK000517
Federal Agency: U.S. Department of Health and Human Services
Type of Finding: Reporting - Compliance and Internal Control (Significant Deficiency)
Criteria:
In accordance with the U.S. Department of Health and Human Services (“HHS”) Grants Policy Statement, reports of expenditures are required as documentation of the financial status of grants according to the official accounting records of the recipient. Financial or expenditure reporting is accomplished using the Financial Status Report (“FSR”) (SF 269 or SF 269A). The FSR is required annually, and the report must be submitted for each budget period no later than 90 days after the close of the budget period or applicable 12-month period. Additionally, performance reports are required by the terms and conditions of the federal awards.
As stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
In the prior year, a significant deficiency in internal controls was identified concerning the lack of sufficient evidence to support the review and approval of performance reports, and the submission of annual FSRs after the required reporting deadline of 90 days following the end of the budget period.
For the performance reporting requirements, our inquiries with management during the current year revealed that no improvements were made to the operating effectiveness of this internal control process over compliance.
For the FSR reporting requirement, from a non-statistical sample of six (6) annual FSRs subject to testing during fiscal year 2024, we identified four (4) FSRs that were submitted after the required reporting deadline of within 90 days following the end of the budget period.
Cause/Effect:
Although DOHMH indicated that they have established policies and procedures to ensure the accurate and timely completion and submission of required reports, we observed that appropriate reviews were not consistently performed and documented for both financial and performance reporting to ensure timely submission.
Questioned Costs:
None noted.
Identification as a Repeat Finding:
This finding is similar to finding #2023-008, included on pages 238 and 239 of the Fiscal 2023 Single Audit
report.
Recommendation:
We recommend that DOHMH enhance their internal controls over the reporting process by ensuring that all financial and special performance reports undergo documented review and approval before submission within the required timeframe.
New York City Department of Health and Mental Hygiene (“DOHMH”)
Finding #: 2024-002
Funding Year(s): 8/1/2019-7/31/2024, 8/1/2019-7/31/2026
Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (FAL #93.323)
Contract Numbers: 5 NU50CK000517, 6 NU50CK000517
Federal Agency: U.S. Department of Health and Human Services
Type of Finding: Reporting - Compliance and Internal Control (Significant Deficiency)
Criteria:
In accordance with the U.S. Department of Health and Human Services (“HHS”) Grants Policy Statement, reports of expenditures are required as documentation of the financial status of grants according to the official accounting records of the recipient. Financial or expenditure reporting is accomplished using the Financial Status Report (“FSR”) (SF 269 or SF 269A). The FSR is required annually, and the report must be submitted for each budget period no later than 90 days after the close of the budget period or applicable 12-month period. Additionally, performance reports are required by the terms and conditions of the federal awards.
As stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
In the prior year, a significant deficiency in internal controls was identified concerning the lack of sufficient evidence to support the review and approval of performance reports, and the submission of annual FSRs after the required reporting deadline of 90 days following the end of the budget period.
For the performance reporting requirements, our inquiries with management during the current year revealed that no improvements were made to the operating effectiveness of this internal control process over compliance.
For the FSR reporting requirement, from a non-statistical sample of six (6) annual FSRs subject to testing during fiscal year 2024, we identified four (4) FSRs that were submitted after the required reporting deadline of within 90 days following the end of the budget period.
Cause/Effect:
Although DOHMH indicated that they have established policies and procedures to ensure the accurate and timely completion and submission of required reports, we observed that appropriate reviews were not consistently performed and documented for both financial and performance reporting to ensure timely submission.
Questioned Costs:
None noted.
Identification as a Repeat Finding:
This finding is similar to finding #2023-008, included on pages 238 and 239 of the Fiscal 2023 Single Audit
report.
Recommendation:
We recommend that DOHMH enhance their internal controls over the reporting process by ensuring that all financial and special performance reports undergo documented review and approval before submission within the required timeframe.
New York City Department of Health and Mental Hygiene (“DOHMH”)
Finding #: 2024-002
Funding Year(s): 8/1/2019-7/31/2024, 8/1/2019-7/31/2026
Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (FAL #93.323)
Contract Numbers: 5 NU50CK000517, 6 NU50CK000517
Federal Agency: U.S. Department of Health and Human Services
Type of Finding: Reporting - Compliance and Internal Control (Significant Deficiency)
Criteria:
In accordance with the U.S. Department of Health and Human Services (“HHS”) Grants Policy Statement, reports of expenditures are required as documentation of the financial status of grants according to the official accounting records of the recipient. Financial or expenditure reporting is accomplished using the Financial Status Report (“FSR”) (SF 269 or SF 269A). The FSR is required annually, and the report must be submitted for each budget period no later than 90 days after the close of the budget period or applicable 12-month period. Additionally, performance reports are required by the terms and conditions of the federal awards.
As stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
In the prior year, a significant deficiency in internal controls was identified concerning the lack of sufficient evidence to support the review and approval of performance reports, and the submission of annual FSRs after the required reporting deadline of 90 days following the end of the budget period.
For the performance reporting requirements, our inquiries with management during the current year revealed that no improvements were made to the operating effectiveness of this internal control process over compliance.
For the FSR reporting requirement, from a non-statistical sample of six (6) annual FSRs subject to testing during fiscal year 2024, we identified four (4) FSRs that were submitted after the required reporting deadline of within 90 days following the end of the budget period.
Cause/Effect:
Although DOHMH indicated that they have established policies and procedures to ensure the accurate and timely completion and submission of required reports, we observed that appropriate reviews were not consistently performed and documented for both financial and performance reporting to ensure timely submission.
Questioned Costs:
None noted.
Identification as a Repeat Finding:
This finding is similar to finding #2023-008, included on pages 238 and 239 of the Fiscal 2023 Single Audit
report.
Recommendation:
We recommend that DOHMH enhance their internal controls over the reporting process by ensuring that all financial and special performance reports undergo documented review and approval before submission within the required timeframe.
New York City Administration for Children’s Services (“ACS”) and New York City Department of Education (“DOE”)
Finding #: 2024-003
Funding Year(s): 4/1/2023 - 9/30/2024
CCDF Cluster: Child Care and Development Block Grant (FAL #93.575)
Contract Numbers: 23-OCFS-LCM-12-R3
Pass-Through Agency: NYS Office of Children and Family Services
Federal Agency: U.S. Department of Health and Human Services
Type of Finding: Eligibility - Material Noncompliance and Internal Control (Material Weakness)
Criteria:
As stipulated by the 45 CFR Part 98 Subpart C, to be eligible for services under the Child Care and Development Block Grant (“CCDBG”), a child shall (1) be under the age of thirteen (13) years of age or be under the age of nineteen (19) and physically or mentally incapable of caring for himself or herself; (2) Reside with a family whose income does not exceed 85 percent of the State's median income (SMI) and whose family assets do not exceed $1,000,000; and (3) reside with a parent or parents who are working or attending a job training or educational program; or receive, or need to receive, protective services.
Additionally, as stipulated by 2 CFR Section 200.303, recipients of federal awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
We selected a non-statistical sample of forty (40) individuals who received services under CCDBG during fiscal year 2024 and found that seven (7) of the individuals tested had errors, detailed as follows:
• One (1) of the individuals tested from DOE did not meet some or all of the eligibility criteria as stipulated in 45 CFR Part 98 Subpart C;
• For six (6) of the individuals tested, ACS paid for hours of care that exceeded the number of hours of care that the individual was eligible to receive based on the authorized hours determined during the eligibility approval process.
Total CCDBG Benefits charged to the grant were $813,778,977 and total CCDBG benefits subjected to testing were $36,043.
Cause/Effect:
While ACS and DOE have a process in place to assess the eligibility of children, a comprehensive review was not consistently performed and documented to ensure the appropriate evidence and related approvals were maintained to support those determinations. This was due to a lack of a process ensuring enrollment and payment for services on behalf of the children were based on and agreed to the authorized hours determined during the eligibility review process. As a result, costs were incurred on behalf of certain children that did not meet all of the eligibility requirements, were not supported by appropriate documentation, or had errors in authorized hours.
Questioned Costs:
Known questioned costs of $4,199.
Identification as a Repeat Finding:
This finding is similar to finding #2023-013, included on pages 248 and 249 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend that ACS and DOE enhance their internal controls for eligibility requirements. This includes implementing a review checklist to ensure each child meets all eligibility criteria as outlined in 45 CFR Part 98 Subpart C during the eligibility determination process.
New York City Administration for Children’s Services (“ACS”) and New York City Department of Education (“DOE”)
Finding #: 2024-003
Funding Year(s): 4/1/2023 - 9/30/2024
CCDF Cluster: Child Care and Development Block Grant (FAL #93.575)
Contract Numbers: 23-OCFS-LCM-12-R3
Pass-Through Agency: NYS Office of Children and Family Services
Federal Agency: U.S. Department of Health and Human Services
Type of Finding: Eligibility - Material Noncompliance and Internal Control (Material Weakness)
Criteria:
As stipulated by the 45 CFR Part 98 Subpart C, to be eligible for services under the Child Care and Development Block Grant (“CCDBG”), a child shall (1) be under the age of thirteen (13) years of age or be under the age of nineteen (19) and physically or mentally incapable of caring for himself or herself; (2) Reside with a family whose income does not exceed 85 percent of the State's median income (SMI) and whose family assets do not exceed $1,000,000; and (3) reside with a parent or parents who are working or attending a job training or educational program; or receive, or need to receive, protective services.
Additionally, as stipulated by 2 CFR Section 200.303, recipients of federal awards are required to establish and maintain an internal control environment that complies with either the guidance in “Standards for Internal Control in the Federal Government” (the “Green Book”) issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) for the federal funding streams it administers.
Condition/Context:
We selected a non-statistical sample of forty (40) individuals who received services under CCDBG during fiscal year 2024 and found that seven (7) of the individuals tested had errors, detailed as follows:
• One (1) of the individuals tested from DOE did not meet some or all of the eligibility criteria as stipulated in 45 CFR Part 98 Subpart C;
• For six (6) of the individuals tested, ACS paid for hours of care that exceeded the number of hours of care that the individual was eligible to receive based on the authorized hours determined during the eligibility approval process.
Total CCDBG Benefits charged to the grant were $813,778,977 and total CCDBG benefits subjected to testing were $36,043.
Cause/Effect:
While ACS and DOE have a process in place to assess the eligibility of children, a comprehensive review was not consistently performed and documented to ensure the appropriate evidence and related approvals were maintained to support those determinations. This was due to a lack of a process ensuring enrollment and payment for services on behalf of the children were based on and agreed to the authorized hours determined during the eligibility review process. As a result, costs were incurred on behalf of certain children that did not meet all of the eligibility requirements, were not supported by appropriate documentation, or had errors in authorized hours.
Questioned Costs:
Known questioned costs of $4,199.
Identification as a Repeat Finding:
This finding is similar to finding #2023-013, included on pages 248 and 249 of the Fiscal 2023 Single Audit report.
Recommendation:
We recommend that ACS and DOE enhance their internal controls for eligibility requirements. This includes implementing a review checklist to ensure each child meets all eligibility criteria as outlined in 45 CFR Part 98 Subpart C during the eligibility determination process.
New York City Police Department (“NYPD”)
Finding #: 2024-006
Funding Year(s): 9/1/2019-8/31/2026
Rail and Transit Security Grant Program (FAL #97.075)
Contract Number(s): EMW-2019-RA-00004, EMW-2020-RA-00005, EMW-2021-RA-00004, EMW- EMW-2022-RA-00006, EMW-2023-RA-00003
Federal Agency: U.S. Department of Homeland Security
Type of Finding: Equipment and Real Property Management - Compliance and Internal Control (Significant Deficiency)
Criteria:
In accordance with 2 CFR section 200.313(d)(1), property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property.
Condition/Context:
The New York City Police Department (“NYPD”) utilizes the City’s Grants Tracking System (“GTS”), a citywide web-based inventory program, designed to standardize the tracking of federally funded equipment. Further, NYPD Command-designated grants coordinators are responsible for monitoring the equipment and updating the inventory on a periodic basis in accordance with federal guidelines. The NYPD Grants Unit periodically generates an inventory listing from GTS that includes the biennial inventory count due date for each item and distributes it to the assigned NYPD Command designated grant coordinators to ensure the inventory count is conducted timely and in accordance with federal requirements. After the completion of biennial inventory count, the NYPD Command-designated grants coordinators update the inventory count information to GTS.
From a non-statistical sample of thirteen (13) pieces of equipment subjected to testing, we identified one (1) piece of equipment that was disposed of prior to the most recent inventory count, but the equipment was not removed from the active inventory listing.
Cause/Effect:
While NYPD had certain procedures in place to monitor their equipment purchased with Federal funding, such procedures were not adequate to ensure that each aspect of the equipment and real property management compliance requirements were performed and documented within the required timeframe, which resulted in the finding noted above. Without the appropriate internal controls and monitoring procedures in place, federally funded equipment could be inaccurately recorded on inventory records and not discovered and corrected timely, inventory could be misplaced, misappropriated, or otherwise disposed of outside of the requirements of the federal guidelines.
Questioned Costs:
None identified.
Identification as a Repeat Finding:
This is not a repeat finding.
Recommendation:
We recommend that NYPD strengthen controls over the inventory process to ensure dispositions of equipment are updated in the equipment records.