The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal grant activity of the City of Big Rapids (the “City”) under programs of the federal government for the year ended June 30, 2025. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Because the schedule presents only a selected portion of the operations of the City, it is not intended to and does not present the financial position, changes in net position, or cash flows of the City. The City’s reporting entity is defined in Note 1 of the City’s financial statements.
Expenditures reported on the Schedule are reported on the accrual basis of accounting, except for federal loan amounts, which are determined in accordance with the applicable requirements of the Uniform Guidance. Expenditures are recognized following the applicable federal cost principles, under which certain types of expenditures are not allowable or are limited as to reimbursement. Federal awards are identified by their applicable Assistance Listing numbers. Pass-through entity identifying numbers are presented on the Schedule, as applicable. For purposes of charging indirect costs to federal awards, the City has not elected to use the 10% de minimis cost rate as permitted by §200.414 of the Uniform Guidance.
The City has an outstanding federal loan associated with the 2010 USDA Community Hangar General Obligation Bonds, reported under the U.S. Department of Agriculture's Community Facilities Loans and Grants program (Assistance Listing Number 10.766). In accordance with 2 CFR 200.502(b), the outstanding balance at the beginning of the fiscal year for federal loans subject to continuing compliance requirements is included in federal awards expended for purposes of the Schedule. The outstanding loan principal balance at July 1, 2024, was $985,000. During the fiscal year ended June 30, 2025, the City made principal repayments totaling $42,000, resulting in an outstanding loan principal balance of $943,000 at June 30, 2025. The amount reported as federal awards expended for this loan program in the accompanying Schedule is $985,000, representing the outstanding principal balance at the beginning of the fiscal year. The outstanding principal balance at June 30, 2025, was $943,000.
The amounts presented in the Schedule reconcile to federal revenues reported in the City's financial statements, with an adjustment for outstanding federal loans that are included as federal awards expended under the Uniform Guidance. Federal revenues reported in the governmental funds totaled $1,897,906. Federal operating grants reported in the business-type funds totaled $236,650, and federal capital grants reported in the business-type funds totaled $118,897. Accordingly, total federal revenues reported in the City's financial statements were $2,253,453. The City also included $985,000 representing the beginning outstanding balance of the USDA Community Facilities loan subject to continuing compliance requirements. After including this amount, total expenditures of federal awards reported in the Schedule were $3,238,453. The federal loan amount included in the Schedule does not represent current-year federal revenue or expenditures reported in the City's basic financial statements but is included for purposes of determining federal awards expended under the Uniform Guidance.