Corrective Action Plans

Finding No.: 2023-040 AL Program: 93.489/93.575/93.596 – CCDF Cluster COVID-19 93.489/93.575/93.596 CCDF Cluster Area: Eligibility Questioned Costs: $12,490 Contact Person(s): Roselle Teregeyo, CCDF Co-Administrator/Accountant Corrective Action Plan: Condition 1: The CNMI CCDF Program respectfully disagrees with this finding. During the audit period, the CNMI CCDF State Plan for FY 2022–2024, Section 3.1.8, Employment Requirements, permitted the acceptance of a USCIS receipt notice (WAC receipt number) as documentation of employment authorization when applicable. Specifically, the State Plan states that a USCIS receipt indicating a WAC number may be requested when necessary and that additional documentation may be requested to identify applicants who meet the long-term employment criteria. Based on the policies in effect during the certification periods cited above, the CCDF Program determined eligibility using the documentation requirements established in the approved CCDF State Plan. Therefore, the questioned costs associated with these cases were incurred in accordance with the Program's established eligibility policies at that time. The issue occurred during a period of increased application volume when eligibility determinations and document reviews were processed manually. In addition, the State Plan language did not explicitly state that USCIS receipt notices would not be accepted as evidence of employment authorization, which contributed to differing interpretations of acceptable documentation requirements. Although the Program maintains that the cited cases were processed in accordance with the policies in effect during the audit period, the CCDF Program has strengthened its documentation requirements to address concerns raised in prior audits. Effective February 1, 2026, the CCDF Program no longer accepts USCIS employment authorization receipt notices as proof of work authorization. This policy change was implemented through CCDF Memorandum Subsidy FY26 No. 1 and serves as a corrective action to ensure consistency and strengthen compliance with employment verification requirements. Program staff have been notified of the revised policy and eligibility determinations will now require approved work authorization documentation rather than receipt notices. Proposed Completion Date: Completed Finding No.: 2023-040, continued AL Program: 93.489/93.575/93.596 – CCDF Cluster COVID-19 93.489/93.575/93.596 CCDF Cluster Area: Eligibility Questioned Costs: $12,490 Contact Person(s): Roselle Teregeyo, CCDF Co-Administrator/Accountant Corrective Action Plan: Condition 2: The CNMI CCDF Program agrees with this finding. During the audit period, provider payments were processed manually for approximately 1,101 children each month. The manual calculation and entry of subsidy amounts increased the risk of human error, resulting in isolated instances of overpayments and underpayments. To strengthen internal controls and reduce the risk of payment errors, the CCDF Program has been working with a contracted system developer since late 2025 to implement an automated subsidy management system. Once operational, the system will automatically calculate and assign payment amounts based on eligibility factors, including the child's age and approved level of care, thereby reducing reliance on manual calculations. The CCDF Program will continue monitoring payment processes and implementing automated controls to improve payment accuracy and strengthen compliance with program requirements. The Program will initiate recovery of the $390 overpayment identified in Case ID 3040 B through adjustments to provider payments scheduled for August and September 2026. For the underpayments identified in Case IDs 3275 B, 3275 C, and 3600 C, the Program will process payment adjustments and issue the respective amounts owed through the August 2026 provider payment cycle. Proposed Completion Date: September 2026

Finding No.: 2023-028 AL Program: COVID-19 21.023 – Emergency Rental Assistance Program Area: Eligibility Questioned Costs: $99,935 Contact Person(s): Epiphanio Cabrera, Jr., Grants Administrator, OGM-SC Corrective Action Plan: Condition 1a: The Office of Grants Management (OGM) respectfully disagrees with the finding and questioned cost of $8,337.00 because assigned personnel were not made aware to supply supporting documents for the following questioned costs. Possible communication breakdown may exist as per OGM staff, and OGM staffer reported a different request list was furnished at different times. However, OGM is pleased to provide you with copies of the documents for these questioned costs items. I believe that the timing played a major role with the release of this draft document, but OGM should not be penalized. We are requesting this finding be removed based on the explanation provided above. Finding No.: 2023-028, continued AL Program: COVID-19 21.023 – Emergency Rental Assistance Program Area: Eligibility Questioned Costs: $99,935 Contact Person(s): Epiphanio Cabrera, Jr., Grants Administrator, OGM-SC Corrective Action Plan: Condition 1b: The Office of Grants Management respectfully disagrees with the finding and questioned cost of $91,598.00 because assigned personnel were not made aware to supply supporting documents for the following questioned costs. Possible communication breakdown may exist as per OGM staff, and OGM staffer reported a different request list was furnished at different times. However, OGM is pleased to provide you with copies of the documents for these questioned costs items. I believe that the timing played a major role with the release of this draft document, but OGM should not be penalized. We are requesting this finding be removed based on the explanation provided above. Proposed Completion Date: Ongoing Condition 1c: The Office of Grants Management disagrees with the finding and questioned cost of $68,181.00 because assigned personnel were not made aware to supply supporting documents for the following questioned costs. Possible communication breakdown may exist as per OGM staff, and OGM staffer reported a different request list was furnished at different times. However, OGM is pleased to provide you with copies of the documents for these questioned costs items. I believe that the timing played a major role with the release of this draft document, but OGM should not be penalized. We are requesting this finding be removed based on the explanation provided above. Proposed Completion Date: Ongoing Condition 1d: The Office of Grants Management disagrees with the finding and questioned cost of $4,500.00 because assigned personnel were not made aware to supply supporting documents for the following questioned costs. Possible communication breakdown may exist as per OGM staff, and OGM staffer reported a different request list was furnished at different times. For this particular finding, the client was unemployed and thus could not provide an employment verification. Finding No.: 2023-028, continued AL Program: COVID-19 21.023 – Emergency Rental Assistance Program Area: Eligibility Questioned Costs: $99,935 Contact Person(s): Epiphanio Cabrera, Jr., Grants Administrator, OGM-SC Corrective Action Plan: However, OGM is pleased to provide you with copies of the documents for these questioned costs items. I believe that the timing played a major role with the release of this draft document, but OGM should not be penalized. We are requesting this finding be removed based on the explanation provided above. Proposed Completion Date: Ongoing Condition 1e: The Office of Grants Management disagrees with the finding and questioned cost of $19,614.00 because assigned personnel were not made aware to supply supporting documents for the following questioned costs. Possible communication breakdown may exist as per OGM staff, and OGM staffer reported a different request list was furnished at different times. However, OGM is pleased to provide you with copies of the documents for these questioned costs items. I believe that the timing played a major role with the release of this draft document, but OGM should not be penalized. We are requesting this finding be removed based on the explanation provided above. Proposed Completion Date: Ongoing

Finding No.: 2023-022 AL Program: COVID-19 17.225 – Unemployment Insurance (UI) Area: Eligibility Questioned Costs: $-0- Contact Person(s): Zachary Taitano, PUA Program Manager, DOL Corrective Action Plan: The CNMI agrees with this finding and acknowledges that a variance exists between the expenditure report details and the listing of payments from the HireMarianas Portal. We are currently reviewing and reconciling both records to determine the cause of the variance. The Expenditure Detail Listing totals $3,057,097.02, while the HireMarianas benefit listing totals $4,112,291.03. During this review, we identified that the HireMarianas benefit listing total includes benefit tax withholdings and child support deductions. However, these amounts are not included in the Expenditure Detail Listing. Therefore, the variance is attributable to PUA tax withholdings ($169,283), FPUC tax withholdings ($150,054), and child support deductions ($202). After excluding these amounts, the adjusted HireMarianas Portal total is $3,792,752.03. Additionally, a review of the MUNIS system identified 19 late entries not reflected in the original Expenditure Detail Listing of $3,057,092.02. These entries represent FY23 expenditures recorded in FY24 and consist of 10 PUA benefit payments totaling $108,937.63 and 9 FPUC benefit payments totaling $110,625.00, for a combined total of $219,562.63. After incorporating these MUNIS late entries into the Expenditure Detail Listing, the adjusted expenditure total is $3,276,654.65. Based on these adjustments, the remaining variance is $516,097.37. Finding No.: 2023-022, continued AL Program: COVID-19 17.225 – Unemployment Insurance (UI) Area: Eligibility Questioned Costs: $-0- Contact Person(s): Zachary Taitano, PUA Program Manager, DOL Corrective Action Plan: CNMI DOL will continue its review and will coordinate with Geographic Solutions, Inc. (GSI), the HireMarianas Portal vendor, and the Department of Finance to further investigate and resolve any remaining discrepancies and to ensure the accuracy and completeness of reported disbursements. Proposed Completion Date: October 2026

2023-007 Tenant Eligibility Material Weakness Recommendation: In general, we continue to recommend a review of the re-certification process to determine areas of weakness. Specifically, we recommend the use of a standard checklist in the re-certification process. We further recommend that each re-certification clerk’s work be routinely audited. We also recommend more standardization in resident files organization of information, and procedures established to make sure all files are maintained adequately in order to be compliant. Action Taken: The Housing Authority agrees with this finding and will implement this recommendation within 120 days of this audit report.

3. Finding 2023-003: Supplemental Nutrition Assistance Program (SNAP), ALN # 10.551, Grant Period 1/1/23 - 12/31/23. Context: Per the Federal OMB Uniform Guidance Circular Compliance Supplement, each individual who receives benefits under the SNAP program should have a completed eligibility determination on file, which is available for audit review. Corrective Action: A substantial number of the identified cases involved 24-month certification renewal periods. As a result, no 2023 application existed for those cases because the recertifications had been completed in 2022 and were not due again until 2024, pursuant to N.J.A.C. 10:87-6.20, Certification Periods. State regulations permit 24-month certification periods for eligible senior citizens and individuals with disabilities. Please see the attached New Jersey Administrative Code provision supporting the applicable 24-month certification period requirements. PCBSS has also implemented additional enhancements to support the DIMS Unit, where files are scanned and electronically stored. The agency increased staffing responsible for document scanning and streamlined the transfer process from worker units to the DIMS Unit. These improvements help ensure that cases are properly identified, organized, maintained, and that supporting case documentation is completed and uploaded timely. Implementation Date: Commenced in 2023 and ongoing.

2. Finding 2023-002: Temporary Assistance for Needy Families (TANF), CFDA #93.558, Grant Period 1/1/22-12/31/22. There were multiple instances where eligibility files selected for review were unable to be presented for audit review. Context: As per the Federal OMB Uniform Guidance Circular Compliance Supplement, each individual who receives benefits under the TANF program should have a completed eligibility determination on file, which is available for audit review. Corrective Action: PCBSS has implemented additional enhancements to support the DIMS Unit, where files are scanned and electronically stored. The agency increased staffing responsible for document scanning and streamlined the transfer process from worker units to the DIMS Unit. These improvements help ensure that cases are properly identified, organized, maintained, and that supporting case documentation is completed and uploaded timely. Implementation Date: Commenced in 2023 and ongoing.

Medical Assistance Program (Medicaid, Title XIX), CFDA #93.778, Grant Period 1/1/23-12/31/23. Context: As per the Federal OMB Uniform Guidance Circular Compliance Supplement, each individual who receives benefits under the Medicaid program should have a complete eligibility determination on file, which is available for audit review. Corrective Action: PCBSS has implemented additional enhancements to support the DIMS Unit, where case files are scanned and electronically stored. The agency increased staffing dedicated to document scanning and streamlined the transfer process from worker units to the DIMS Unit. These improvements help ensure that cases are properly identified, organized, and maintained, and that supporting documentation is uploaded timely and accurately. Additionally, several Medicaid cases identified during the review were initially established by the State of New Jersey and/or third-party vendors contracted by the State prior to being transferred to the county for ongoing case management responsibilities. As a result, PCBSS did not possess the original applications or supporting eligibility documentation because the initial eligibility determination and enrollment process had already been completed before the cases were transferred to the county. Moving forward, PCBSS will provide auditors with system-generated portal documentation identifying the originating agency responsible for the initial case establishment. Implementation Date: Commenced in 2023 and ongoing.

Director of American Rescue Plan (ARP) Programs, Federal program managers, and Chief Financial Officer October 2023 Management remains committed to continuous improvement and has taken corrective actions to strengthen internal controls, ensure proper documentation retention, and maintain full compliance with applicable federal regulations

The County has since implemented corrective actions to strengthen internal controls and ensure compliance moving forward, including: Providing targeted staff training on eligibility requirements, including self-attestation limitations. Implementing a secondary review process for eligibility determinations and payment calculations when clients self-certify income. Establishing ongoing monitoring procedures, including periodic file reviews. Benton County is committed to maintaining strong internal controls and ensuring compliance with all applicable federal and state requirements. These enhancements are designed to prevent recurrence and support consistent application of program guidelines.

Developed and implemented a standardized procedures for documenting and retaining support for all grant activity. Reveiwed all grant paperword, reconciled with supportive documentation

Developed and implemented a standardized procedures for documenting and retaining support for all grant activity. Reveiwed all grant paperword, reconciled with supportive documentation

Developed and implemented a standardized procedures for documenting and retaining support for all grant activity. Reveiwed all grant paperword, reconciled with supportive documentation

Developed and implemented a standardized procedures for documenting and retaining support for all grant activity. Reveiwed all grant paperword, reconciled with supportive documentation

Developed and implemented a standardized procedures for documenting and retaining support for all grant activity. Reveiwed all grant paperword, reconciled with supportive documentation

Developed and implemented a standardized procedures for documenting and retaining support for all grant activity. Reveiwed all grant paperword, reconciled with supportive documentation

Concord’s Compliance Dept has implemented procedures to ensure the tenant security deposits are correctly recorded, tenant eligibility is correctly determined and that the tenant lease files are properly maintained in accordance with HUD’s requirements.

2023-004 SCDA Eligibility Material Weakness and Non-Material Noncompliance Corrective Action: We've hired competent staff that will maintain records of the 3 (Partner, Training and TEFAP) agreements that Agencies will sign annually for compliance. Person Responsible: Stephano Blake Email: SBlake@harvesthope.org Phone: 803-636-6635

Response: Management concurs with the finding. Corrective Action Plan: NewSpace Nexus will comply with federal employment eligibility requirements by ensuring a Form I-9 is completed for every employee within three business days of their start date. Employees must provide acceptable documentation as required, and completed forms will be securely maintained and retained for the required period. The Financial Analyst will periodically review personnel files to confirm compliance, and any missing or incomplete forms will be addressed promptly with documentation of corrective actions retained. Designation of Employee Position Responsible for Meeting Deadline: Financial Analyst by: January 31st, 2024

Finding: 2023-005 Agency: Children & Youth Contact Person/Title: Erin Moyer. Administrator of Children & Youth Services Finding Title/Corrective Action: Eligibility – Missing Documentation Documentation for eligibility will be reviewed with staff and files will be reviewed by a supervisor. A supervisor checklist will be used to make sure documents are reviewed. Our IV-E files are also reviewed twice a year by a state IV-E QA team. Anticipated Completion Date: January 2026

Finding 2023-004 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Housing Voucher Cluster, Public and Indian Housing Program, Public Housing Capital Fund Program, and Coronavirus Relief Fund Assistance Listing Numbers: 14.871, 14.879, 14.850, 14.872, and 21.019 Material Noncompliance Non Compliance Material to the Financial Statements: Yes Material Weakness in Internal Control over Compliance Criteria: The Authority must maintain complete and accurate accounts and other records for the program in accordance with HUD compliance requirements. Condition: The Authority did not maintain complete and accurate accounts and other records in accordance with HUD compliance requirements regarding Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Eligibility, Reporting, and Special Tests and Provisions. Context: The Authority was unable to provide requested documentation at the time of audit to properly test the HUD compliance requirements. Known Questioned Costs: Unknown Cause: There is a material weakness in internal controls over compliance related to the maintenance of tenant files, wait lists, inspection reports and other records. The Authority has not properly considered, designed, implemented, maintained and monitored a system of internal controls that reasonably assures the program is in compliance. Effect: The Housing Voucher Cluster is in material non- compliance with the compliance requirements of the program. Recommendation: We recommend that the Authority implement a process whereby Authority documents are stored and safeguarded to ensure compliance with the Uniform Guidance and the compliance supplement. View of Responsible Officials and Corrective Actions: The Authority experienced significant turnover in employees during the year and as a result certain source documents were misplaced or destroyed. Management agrees with the Auditors' finding and has hired a new Executive Director who will implement the required safeguards and ensure that the Authority follows its internal control over compliance processes and procedures related to the Housing Voucher Cluster, Public and Indian Housing Program and Public Housing Capital fund Program to remedy the aforementioned deficiencies. Byran McClellan, CFO, will be responsible to implement this corrective action by December 31, 2023.

Finding Reference Number: 2023-010 Description of Finding: Documentation of eligibility determination for an applicant could not be located. Response/Corrective Action: The County outsourced the administration of the Emergency Rental Assistance Program to several third parties over the duration of the Federally-funded program. Due to several administration changes, it is apparent that one of the files was either commingled with another record, misfiled, or misplaced. There is no evidence to suggest authorization and disbursement of funds occurred at the time of processing without a complete file supporting the activity was qualified and released was so approved. The County will be more diligent in the management and storage of required records for contact guideline requirements moving forward.

FINDING 2023-003 - Sliding Fee Discount Program MATERIAL WEAKNESS; NONCOMPLIANCE Identification of the Federal Program: U.S. Department of Health and Human Services; direct awards ALN: 93.224/93 .527, Health Center Program Cluster Compliance Requirement: Special Tests & Provisions Criteria: Section 330 of the Public Health Service Act and the HRSA Health Center Program Compliance Manual require health centers to maintain and operate a board-approved Sliding Fee Discount Program that adjusts patient charges based on income and family size using the current Federal Pove1ty Guidelines, applies uniformly to all patients and all in-scope services, and is supported by adequate documentation of eligibility determinations. In addition, Uniform Guidance requires nonfederal entities to establish and maintain effective internal controls over federal programs to provide reasonable assurance of compliance with federal statutes, regulations, and award terms. Condition: During testing of the Sliding Fee Discount Program within the Health Center Cluster, the Center could not provide documentation of the appropriate sliding fee discounts for certain patients in accordance with federal requirements. Context: The condition was identified through testing of the Health Center Cluster as pa1i of the single audit, which included testing patient fee assessments and sliding fee discount application as a special test required under the program. Controls were determined to be ineffective in 2 of 40 test items. Noncompliance was noted in 2 of 25 test items. Statistical sampling was not utilized. Cause: The condition was caused by inadequate internal controls over the implementation and monitoring of the Sliding Fee Discount Program, including limited supervisory review to ensure all sliding fee applications are maintained, reviewed, and properly applied. Effect or Potential Effect: The Center's failure to maintain documentation surrounding sliding fee discounts in accordance with federal requirements increases the risk of noncompliance with Health Center Program requirements and may result in patients being charged amounts not aligned with their ability to pay. The condition also increases the risk of adverse findings during HRSA oversight or other federal monitoring activities. Questioned Costs: No questioned costs were identified as a result of this finding. Repeat Finding: This is not a repeat finding. Recommendation: The Center should enhance internal controls over the Sliding Fee Discount Program by ensuring consistent documentation of income and family size, timely reassessment of eligibility in accordance with policy, consistent application of the board-approved sliding fee discount schedule to all applicable in-scope services, and periodic monitoring and supervisory review to ensure ongoingcompliance. Views of Responsible Officials: Neighborhood Medical Center has implemented quarterly SFDP internal audits and training for the intake staff to improve compliance oversight and documentation accuracy. A standardized audit tracking log documenting charts are reviewed, findings identified and corrective actions completed. An annual refresher for the staff has been implemented. A quick-reference eligibility checklist has also been developed for staff use. Person Responsible for Corrective Action: Ronica Mathis and Shenika Mathews Anticipated Completion Date for Corrective Action: This practice has already been implemented.

"Recommendation We recommend that management: ▪ Implement formal procedures to ensure complete documentation of all program activities ▪ Maintain records demonstrating that activities are authorized and aligned with program objectives ▪ Establish centralized recordkeeping and retention policies ▪ Perform ongoing monitoring and review of program activities ▪ Train staff on federal compliance requirements and documentation expectations"

The Division will take steps to ensure sub-recipient agreements are retained and the distribution sites maintain sign-in sheets requiring participants to self-certify they meet the grant eligibility requirements. September 2026 Al Agpoon, Golden State Division Controller

Tenant File Review - Review all tenant files; obtain and file missing documentation - May 2026 Policies and procedures - Update and document procedures; implement standardized checklist; supervisory review required. - May 2026 Staff Training - Train staff on HUD eligibility, documentation standards, and updated procedures Ongoing Monitoring - Quarterly internal audits; COO and Board Finance Committee review of compliance - ongoing Oversight and Reporting - CFO/Controller review monthly reconciliations; provide quarterly updates to finance committee - ongoing