FAC Explorer

Audit 52895

FY End
2022-12-31
Total Expended
$14.25M
Findings
4
Programs
7
Organization: City of Johnstown (PA)
Year: 2022 Accepted: 2023-08-10
Auditor: Wessel & Company

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
50283 2022-003 Material Weakness - I
50284 2022-004 Material Weakness - M
626725 2022-003 Material Weakness - I
626726 2022-004 Material Weakness - M

Programs

ALN Program Spent Major Findings
21.027 Coronavirus State and Local Fiscal Recovery Funds $13.05M Yes 2
66.818 Brownfields Assessment and Cleanup Cooperative Agreements $254,370 - 0
16.710 Public Safety Partnership and Community Policing Grants $135,300 - 0
14.218 Community Development Block Grants/entitlement Grants $10,000 Yes 0
14.239 Home Investment Partnerships Program $6,884 - 0
14.900 Lead-Based Paint Hazard Control in Privately-Owned Housing $4,691 - 0
14.218 Covid19 - Community Development Block Grants/entitlement Grants $4,596 Yes 0

Contacts

Name Title Type
XBNQXGRF1YJ9 Robert Ritter Auditee
8145332032 Michael Lamb Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform 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. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal grant activity of the City of Johnstown under programs of the federal government for the year ended December 31, 2022. 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 City of Johnstown, it is not intended to and does not present the financial position, changes in net assets or cash flows of The City of Johnstown.
Title: Subrecipients Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform 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. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The City of Johnstown provided federal awards to certain subrecipients that administer the programs on behalf of the City, as follows: Federal AmountProgram Title / Subrecipient CFDA Number ProvidedCommunity Development Block Grant:14.218Catholic Charities$ 17,445Learning Lamp 25,000Flood City Youth18,787COVID19 Coronavirus State and Local Fiscal Relief Fund: 20.027Johnstown Redevelopment Authority 3,000,000 Total$ 3,061,232

Finding Details

Finding 2022-003
2022-003 ? Procurement Criteria: The City is responsible for establishing and maintaining a procurement policy which is compliant with the Uniform Guidance in 2 CFR 200.320. In addition, the City is responsible for maintaining adequate records relating to procurements. Condition: The City?s procurement policy lacks the specific methods of procurement to be followed and the respective thresholds for procurements using federal funds. Furthermore, there is not adequate pre-award documentation maintained relating to each of the City?s procurements. Cause: The City?s procurement policy was not adequately updated with necessary Uniform Guidance requirements. In addition, the City?s procurement process is not centralized and there is inadequate or missing pre-award documentation pertaining to the City?s various procurements. Effect: The condition above could result in material program and internal control issues relating to procurements whereby: appropriate methods of procurement may not be followed, debarred or suspended vendors or contractors could be awarded purchase orders or contracts, open and fair competition may not be achieved, etc. Context: Audit procedures noted that the procurement policy is inadequate and not in line with Uniform Guidance. Furthermore, audit procedures noted that there is no centralized process in place for tracking the City?s various procurements along with inadequate pre-award documentation. There was a total of $3,969,370 of expenditures relating to procurements during the year ended December 31, 2022; however, documentation was not deemed adequate to substantiate the procurements and whether they complied with Uniform Guidance. Questioned Costs: We questioned $3,969,370 of costs because this equaled the expenditures related to procurements during the year ended December 31, 2022. We reviewed the expenditures for the eight (8) projects with procurements during the year ended December 31, 2022 and determined that there was not appropriate pre-award documentation and an improper procurement policy that would permit the testing of procurements. Recommendation: We recommend that the City adopt a proper procurement policy that is in line with Uniform Guidance. We further recommend that the City develops a centralized procurement process whereby appropriate procurement type is documented along with the maintenance of proper pre-award documentation.
Finding 2022-004
2022-004 ? Subrecipient Monitoring Criteria: The City is responsible for identifying the applicable requirements and relevant terms and conditions to the subaward entity at the time of award, or by means subsequent modification to the subawards. Condition: The City?s agreement with Johnstown Redevelopment Authority relating to the Weatherization program, funded by means of State and Local Fiscal Relief Funds, was not appropriately amended to reflect the intentions of both entities subsequent to the initial award. Cause: The intentions of each party with respect to the nature of the subaward with Johnstown Redevelopment Authority changed after the initial award and there were no subsequent modifications to the subaward agreement. Effect: The condition above could have resulted in programmatic issues related to spending as well as reporting over the subaward period. Context: The City is responsible for clearly outlining the terms and conditions of subawards. Questioned Costs: None Recommendation: We recommend that the City appropriately amend its subaward agreement with Johnstown Redevelopment Authority to clearly specify the terms and conditions of the agreement.
Finding 2022-003
2022-003 ? Procurement Criteria: The City is responsible for establishing and maintaining a procurement policy which is compliant with the Uniform Guidance in 2 CFR 200.320. In addition, the City is responsible for maintaining adequate records relating to procurements. Condition: The City?s procurement policy lacks the specific methods of procurement to be followed and the respective thresholds for procurements using federal funds. Furthermore, there is not adequate pre-award documentation maintained relating to each of the City?s procurements. Cause: The City?s procurement policy was not adequately updated with necessary Uniform Guidance requirements. In addition, the City?s procurement process is not centralized and there is inadequate or missing pre-award documentation pertaining to the City?s various procurements. Effect: The condition above could result in material program and internal control issues relating to procurements whereby: appropriate methods of procurement may not be followed, debarred or suspended vendors or contractors could be awarded purchase orders or contracts, open and fair competition may not be achieved, etc. Context: Audit procedures noted that the procurement policy is inadequate and not in line with Uniform Guidance. Furthermore, audit procedures noted that there is no centralized process in place for tracking the City?s various procurements along with inadequate pre-award documentation. There was a total of $3,969,370 of expenditures relating to procurements during the year ended December 31, 2022; however, documentation was not deemed adequate to substantiate the procurements and whether they complied with Uniform Guidance. Questioned Costs: We questioned $3,969,370 of costs because this equaled the expenditures related to procurements during the year ended December 31, 2022. We reviewed the expenditures for the eight (8) projects with procurements during the year ended December 31, 2022 and determined that there was not appropriate pre-award documentation and an improper procurement policy that would permit the testing of procurements. Recommendation: We recommend that the City adopt a proper procurement policy that is in line with Uniform Guidance. We further recommend that the City develops a centralized procurement process whereby appropriate procurement type is documented along with the maintenance of proper pre-award documentation.
Finding 2022-004
2022-004 ? Subrecipient Monitoring Criteria: The City is responsible for identifying the applicable requirements and relevant terms and conditions to the subaward entity at the time of award, or by means subsequent modification to the subawards. Condition: The City?s agreement with Johnstown Redevelopment Authority relating to the Weatherization program, funded by means of State and Local Fiscal Relief Funds, was not appropriately amended to reflect the intentions of both entities subsequent to the initial award. Cause: The intentions of each party with respect to the nature of the subaward with Johnstown Redevelopment Authority changed after the initial award and there were no subsequent modifications to the subaward agreement. Effect: The condition above could have resulted in programmatic issues related to spending as well as reporting over the subaward period. Context: The City is responsible for clearly outlining the terms and conditions of subawards. Questioned Costs: None Recommendation: We recommend that the City appropriately amend its subaward agreement with Johnstown Redevelopment Authority to clearly specify the terms and conditions of the agreement.