Audit 381165

2024-003 ARPA Annual Performance Report Criteria: The federal grant agreement for the Coronavirus State and Local Fiscal Recovery Funds grant (AL 21.027), along with relevant federal program regulations, mandates the submission of annual performance reports. These reports are essential for demonstrating compliance and the effective use of federal funds in achieving program objectives. Condition/Cause: Pierce County failed to submit its annual performance report for the fiscal year ended December 31, 2024, for the CSLFRF grant to the U.S. Department of the Treasury. The performance report, a required element of the grant agreement, documents the progress and outcomes of the program. As of the date of this report, the performance report has not been submitted. Effect: Non-compliance with the federal performance reporting requirements can lead to sanctions, including a determination of noncompliance, suspension of grant funding, or a requirement to repay expended funds. Without the performance report, the City is unable to demonstrate the program’s effectiveness and its successful impact on the community, which may negatively affect its ability to secure future federal funding. Cause: The failure to submit the performance report appears to be due to a lack of coordination between the County’s program staff and the grant management office. The County did not have a formalized system for collecting, aggregating, and reporting the required performance data from various projects. As a result, the necessary data for the report was not compiled in a timely manner. Recommendation: We recommend that the County establish and implement a formal, written procedure for the collection and submission of performance data. This procedure should designate clear responsibilities for data collection, set specific times for internal reporting, and require a final review by a designated senior manager to ensure the completeness and accuracy of all performance reports prior to submission. Views of Responsible Officials and Planned Corrective Action: We concur and will implement the appropriate controls to comply with the grant requirements.