The accompanying schedule of expenditures of federal awards and state financial assistance includes the federal and state grant activity of the City of Memphis and is presented on the modified accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of the Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Therefore, some amounts presented in this schedule may differ from those presented in or used in preparing the general‐purpose financial statements. In compliance with Tennessee state law, the accompanying schedule of expenditures of state financial assistance is included in this report. The schedule presents all state‐funded financial awards, as defined by the State Comptroller of the Treasury's Office, and is prepared and presented in a manner consistent with the schedule of expenditures of federal awards.
The expenditures presented in the associated schedules of expenditures of federal awards and state financial assistance were developed from agency records and federal and state financial reports which have been reconciled to the central accounting records of the government. Governmental funds are reported using a modified accrual basis of accounting. Proprietary funds are reported using the accrual basis of accounting. Federal and state revenues and expenditures are included in the general fund, special revenue funds, capital projects funds, and enterprise funds in the government's basic financial statements. The City of Memphis has not elected to use the 10% de minimis indirect cost rate under the Uniform Guidance.
The City of Memphis was approved by the Environmental Protection Agency, Office of Water, to receive a loan totaling $100,000,000 (SRF 13‐311) to improve its sewer system. The amount listed for this loan, $71,702,290, includes proceeds during the year and the outstanding loan balance from prior years. The City of Memphis was approved by the Environmental Protection Agency, Office of Water, to receive a loan totaling $7,000,000 (SRF 06‐195) to improve its sewer system. The amount listed for this loan, $ 1,658,645, includes proceeds during the year and the outstanding loan balance from prior years. This loan has been closed out and no further draws will be made on it. The City of Memphis was approved by the Environmental Protection Agency, Office of Water, to receive a loan totaling $22,000,000 (SRF 13‐309) to improve its sewer system. The amount listed for this loan, $ 7,073,273, includes proceeds during the year and the outstanding balance from prior years. The City of Memphis was approved by the Environmental Protection Agency, Office of Water, to receive a loan totaling $25,000,000 (SRF 15‐355) to improve its sewer system. The amount listed for this loan, $18,804,910, includes proceeds during the year. The City of Memphis was approved by the Environmental Protection Agency, Office of Water, to receive a loan totaling $11,000,000 (SRF 18‐409) to improve its sewer system. The amount listed for this loan, $8,178,207, includes proceeds during the year. The City of Memphis was approved by the Environmental Protection Agency, Office of Water, to receive a loan totaling $6,500,000 (SRF 19‐421) to improve its sewer system. The amount listed for this loan, $ 4,824,496, includes proceeds during the year. The City of Memphis was approved by the Environmental Protection Agency, Office of Water, to receive a loan totaling $48,000,000 (SRF 19‐434) to improve its sewer system. The amount listed for this loan, $44,338,930, includes proceeds during the year. The City of Memphis was approved by the Environmental Protection Agency, Office of Water, to receive a loan totaling $15,000,000 (SRF 21‐451) to improve its sewer system. The amount listed for this loan, $13,115,702, includes proceeds during the year. The City of Memphis was approved by the Environmental Protection Agency, to receive a Water Infrastructure Finance and Innovation Act (WIFIA) loan totaling $156,000,000 (18157TN) to improve its sewer system. The amount listed for this loan, $107,920,117.16, includes proceeds during the year. Both the current and prior year loans are also reported on the City of Memphis's Statement of Net Position for Proprietary Funds. Also, the current loan payable and the long‐term loan payable equal the total loan amounts. (see Exhibit A‐9)
The federal and state awards received by the City of Memphis are subject to audit and adjustment. If any expenditures are disallowed by the grantor agencies because of such an audit, the grantor agencies could make a claim for reimbursement, which would become a liability of the City of Memphis.
The negative expenditure balance of ($114,725) reported for the US Department of Transportation Highway Planning and Construction Cluster Pass Through Funding to Tennessee Department of Transportation (TDOT) (ALN 20.205) represents an adjustment for an overstatement of costs from the prior fiscal year ended June 30, 2023.Original error: During the 2023 fiscal year, the City reported $1,669,942 in expenditures for the Biomedical Sidewalk project. This included $114,725 in Architecture and Engineering costs that were refunded by TDOT during fiscal year 2025. Prior period adjustment: After a review, the City's financial team made a correction to reduce the total expenditures for this program. To avoid restating the prior year's SEFA, the adjustment was recorded as a negative expenditure in the current fiscal year (2025). Net effect: This adjustment reduces the cumulative federal expenditures reported for the US Department of Transportation Highway Planning and Construction Cluster Pass Through Funding to TDOT program. The negative expenditure balance of ($2,074) reported for the US DOT Alcohol Open Container Requirements (ALN 20.607) represents an adjustment for an overstatement of costs from the prior fiscal year ended June 30, 2023. Original error: During the 2023 fiscal year, the City reported $32,783 in expenditures for the DUI Laws project. This included $2,074 in Overtime costs that were later determined to be unallowable under the terms of the grant award. Prior period adjustment: After a review, the City's financial team made a correction to reduce the total expenditures for this program. To avoid restating the prior year's SEFA, the adjustment was recorded as a negative expenditure in the current fiscal year (2025). Net effect: This adjustment reduces the cumulative federal expenditures reported for the DUI Laws program. The negative expenditure balance of ($3,945) reported for the US DOT Alcohol Open Container Requirements (ALN 20.607) represents an adjustment for an overstatement of costs from the prior fiscal years ended June 30, 2022 and June 30, 2023. Original errors: During the 2022 fiscal year, the City reported $4,010 in expenditures for the THSO FY22 Network Coordinator project. This included $1,721 in Travel Expenses that were later determined to be unallowable under the terms of the grant award. During the 2023 fiscal year, the City reported $2,223 in expenditures for the THSO FY22 Network Coordinator project. This included $864 in Travel Expenses and $1,360 in Overtime costs that were later determined to be unallowable under the terms of the grant award. Prior period adjustment: After a review, the City's financial team made a correction to reduce the total expenditures for this program. To avoid restating the prior years’ SEFAs, the adjustment was recorded as a negative expenditure in the current fiscal year (2025). Net effect: This adjustment reduces the cumulative federal expenditures reported for the US DOT Alcohol Open Container Requirements program. The negative expenditure balance of ($674) reported for the US DOT Alcohol Open Container Requirements (ALN 20.607) represents an adjustment for an overstatement of costs from the prior fiscal years ended June 30, 2022 and June 30, 2023. Original errors: During the 2022 fiscal year, the City reported $19,518 in expenditures for the THSO FY22 Traffic Education project. This included $35 in Travel Expenses that were later determined to be unallowable under the terms of the grant award. During the 2023 fiscal year, the City reported $47,830 in expenditures for the THSO FY22 Traffic Education project. This included $211 in Travel Expenses and $428 in Overtime costs that were later determined to be unallowable under the terms of the grant award. Prior period adjustment: After a review, the City's financial team made a correction to reduce the total expenditures for this program. To avoid restating the prior years’ SEFAs, the adjustment was recorded as a negative expenditure in the current fiscal year (2025). Net effect: This adjustment reduces the cumulative federal expenditures reported for the US DOT Alcohol Open Container Requirements program.
The negative expenditure balance of ($11,849) reported for the Violent Crime/Illegal Opioids project (contract 2018-YX-BX-004) represents an adjustment for an overstatement of costs from the prior fiscal year ended June 30, 2023. Original error: During the 2023 fiscal year, the City reported $11,849 in expenditures for the Violent Crime/Illegal Opioids project. This included $11,849 in Equipment costs that were later determined to be reported on the wrong program. Prior period adjustment: After a review, the City's financial team made a correction to reduce the total expenditures for this program. To avoid restating the prior year’s SEFA, the adjustment was recorded as a negative expenditure in the current fiscal year (2025). Net effect: This adjustment reduces the cumulative state expenditures reported for the Violent Crime/Illegal Opioids program. The negative expenditure balance of ($900) reported for the THSO Traffic FY23 project (contract 23-74579 (PT)) represents an adjustment for an overstatement of costs from the prior fiscal year ended June 30, 2024. Original error: During the 2024 fiscal year, the City reported $182,940 in expenditures for the THSO Traffic FY23 project. This included $900 in Travel Expenses that were later determined to be unallowable under the terms of the grant award. Prior period adjustment: After a review, the City's financial team made a correction to reduce the total expenditures for this program. To avoid restating the prior year’s SEFAs, the adjustment was recorded as a negative expenditure in the current fiscal year (2025). Net effect: This adjustment reduces the cumulative state expenditures reported for the THSO Traffic FY23 program.