FAC Explorer

Audit 4886

FY End
2023-06-30
Total Expended
$4.18M
Findings
2
Programs
8
Organization: City of Escanaba (MI)
Year: 2023 Accepted: 2023-12-01
Auditor: Rehmann Robson LLC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
3018 2023-002 Material Weakness - L
579460 2023-002 Material Weakness - L

Programs

ALN Program Spent Major Findings
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $1.78M Yes 1
66.458 Capitalization Grants for Clean Water State Revolving Funds $960,188 - 0
45.310 Grants to States $143,086 - 0
21.027 Coronavirus State and Local Fiscal Recovery Funds $22,727 Yes 0
16.738 Edward Byrne Memorial Justice Assistance Grant Program $20,253 - 0
97.039 Hazard Mitigation Grant $10,315 - 0
16.710 Public Safety Partnership and Community Policing Grants $9,465 - 0
16.607 Bulletproof Vest Partnership Program $5,800 - 0

Contacts

Name Title Type
RDP9JWL1K5C3 Melissa Becotte Auditee
9067860605 Paul Matz, CPA Cgfm Auditor
No contacts on file

Notes to SEFA

Title: Clean Water State Revolving Loan Accounting Policies: The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal grant activity of the City of Escanaba, Michigan (the “City”) under programs of the federal government for the year ended June 30, 2023. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). 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. The City's financial statements include the operations of the Escanaba Housing Commission discretely presented component unit, which received federal awards that are not included in the Schedule for the year ended June 30, 2023, as the entity was separately audited. Expenditures reported on the Schedule are reported on the accrual basis of accounting, which is described in Note 1 to the City's financial statements. Such expenditures are recognized following the cost principles contained in the Uniform Guidance or other applicable guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: N/A The outstanding balance on the Clean Water State Revolving Loan was $13,331,566 as of June 30, 2023.

Finding Details

Finding 2023-002
2023-002 – Reporting Finding Type. Material Noncompliance/Material Weakness in Internal Control over Compliance (Reporting). Program. Community Development Block Grants/State's Program & Non-Entitlement Grants in Hawaii; U.S. Department of Housing and Urban Development; passed through the Michigan Economic Development Corporation; Assistance Listing Number 14.228; Award Number MSC 221002-WRI. Criteria. The City is required to file Program Progress Reports beginning January 17, 2022, and every six months thereafter. In addition, the City is required to file a final Program Progress Report within 120 days of the expiration of the grant. Additionally, the City is required to file Section 3 summary reports. Condition. The City has not filed any of the required reports as of June 30, 2023. Cause. The City did not have the proper internal controls in place to ensure that all required reports were filed in accordance with the requirements of the grant agreement. Effect. As a result of this condition, the City did not follow federal requirements in regards to filing required reports. Questioned Costs. No costs have been questioned as a result of this finding inasmuch as no disallowed costs were identified. Recommendation. We recommend that the City implement internal controls over reporting to ensure that all required reports are filed in a timely manner. View of Responsible Officials. The City does not have the necessary staffing to handle all of the requirements of large scale projects. As a result, the City hired an engineer and a certified grant administrator to manage many parts of this project and the reporting requirements are part of those duties. Unfortunately, the reports were not filed as required. Both parties are working to correct these mistakes.
Finding 2023-002
2023-002 – Reporting Finding Type. Material Noncompliance/Material Weakness in Internal Control over Compliance (Reporting). Program. Community Development Block Grants/State's Program & Non-Entitlement Grants in Hawaii; U.S. Department of Housing and Urban Development; passed through the Michigan Economic Development Corporation; Assistance Listing Number 14.228; Award Number MSC 221002-WRI. Criteria. The City is required to file Program Progress Reports beginning January 17, 2022, and every six months thereafter. In addition, the City is required to file a final Program Progress Report within 120 days of the expiration of the grant. Additionally, the City is required to file Section 3 summary reports. Condition. The City has not filed any of the required reports as of June 30, 2023. Cause. The City did not have the proper internal controls in place to ensure that all required reports were filed in accordance with the requirements of the grant agreement. Effect. As a result of this condition, the City did not follow federal requirements in regards to filing required reports. Questioned Costs. No costs have been questioned as a result of this finding inasmuch as no disallowed costs were identified. Recommendation. We recommend that the City implement internal controls over reporting to ensure that all required reports are filed in a timely manner. View of Responsible Officials. The City does not have the necessary staffing to handle all of the requirements of large scale projects. As a result, the City hired an engineer and a certified grant administrator to manage many parts of this project and the reporting requirements are part of those duties. Unfortunately, the reports were not filed as required. Both parties are working to correct these mistakes.