Corrective Action Plans

Finding: 2021-001 Personnel Responsible for Corrective Action: Rachel Webb, Controller at Urban Strategies, Inc. Anticipated Completion Date: June 30, 2023 Corrective Action Plan: Urban Strategies, Inc. acknowledges the lack of record retention after an employee left the organization. After a thorough review of allowable costs, all were deemed materially correct. Urban Strategies, Inc. communicated to the departments involved the necessary improvements to the internal controls that were agreed upon in order to prevent the deficiencies from occurring in the future. Urban Strategies, Inc. is refining procedures to ensure all reviews and communications are performed, reviewed and documented timely and accurately, as well as ensuring all review documentation is properly retained.

Corrective Action Planned: SSVF Policies and Procedure Guide will be updated at the agency CARF retreat to reflect the process of transactions related to SSVF and updated retention polices and documentation requirements. Contact Person: Cassandra Montgomery, Executive Director Anticipated Completion Date: All staff training was held on Wednesday, May 3, 2023 @11:00AM.

The County engaged an outside consultant to assist with compliance and reporting of the CSLFRF grant. Moving forward, management will ensure that a County employee, if working with a consultant or otherwise, be responsible for verifying compliance with all aspects of all federal grants.

Eligibility: The college noted the finding, and the program is working to gather all required documents from current and previous Upward Bound students. The program will use the college’s electronic filing system and the standards described in the Upward Bound grant application moving forward. September 30, 2022 Stevenson Kotton VPBAA Pam Kaios UB Director

2021-001 Condition: Deficiencies Noted in Maintenance of Tenant Files Steps to resolve: Management agrees with the audit finding and the auditor’s recommendation. We will implement procedures and changes to ensure that this finding will be cleared by the subsequent fiscal year audit. Individual responsible for correction: Mr. Damon Dunbar, Executive Director Timeframe: As of December 31, 2022

Finding No.: 2021-041 AL Program: 97.050 - Presidential Declared Disaster Assistance to Individuals and Households – Other Needs Area: Eligibility Questioned Costs: $2,430 Contact Person(s): Zachary Taitano, PUA Program Manager, DOL Corrective Action Plan: CNMI DOL agrees with this finding. The three remaining applicants noted above were indeed paid then later found to be ineligible for benefits. Currently, they are pending to undergo audit and potentially recollection should fault not reside with CNMI DOL. However, it is important to note that the amount of questioned costs indicated by the auditors in both Draft 2 of the Audit Report does not reflect the updated amount of $2,430. Proposed Completion Date: Ongoing

Finding No.: 2021-034 AL Program: 93.489/93.575/93.596 - CCDF Cluster Area: Eligibility Questioned Costs: $39,200 Contact Person(s): Roselle Teregeyo, CCDF Co-Administrator/Accountant Corrective Action Plan: Condition 1: CCDF disagrees with this finding. Please refer to the documents submitted. Case ID 3170B: CW1-upon submission of the CCDF Waitlist application the CW1 was valid. Case ID 3242B: CW1-upon submission of the CCDF Waitlist application the CW1 was valid. Case ID 3097A: CW1-upon submission of the CCDF Waitlist application the CW1 was valid. Condition 2: CCDF agrees with this finding. This is correct that there were no dates indicated on the affidavits. The cases questioned happened during Covid-19 which applicants are sending their applications through email. (Please see documents submitted). As a policy, CCDF is already in practice of ensuring date is stated with the signature of the affiant and such affidavit is notarized. Condition 3: CCDF disagrees with this finding. 1040 tax forms are not required for the CCDF Renewal application, and it is only required for self-employed applicants. Please see the application checklist on the questioned cases. Condition 4: CCDF disagrees with this finding. At the time of the submission of the renewal application, the applicant had a valid CW1. The application was submitted on June 15, 2020, the CW1 that was submitted did not expire until September 9, 2020. All documents for verification are on file. Applicant was off island for medical purposes at the time of Certificate of Confirmation (renewal certificate) routing, upon her return she submitted a copy of her passport that indicated that she became a CW2 holder, CCDF then proceeded with termination because of her CW2 status. (Please refer to the documents submitted). Proposed Completion Date: Ongoing

Finding No.: 2021-029 AL Program: 21.023 - Emergency Rental Assistance Program Area: Eligibility Questioned Costs: $4,252 Contact Person(s): Epiphanio Cabrera, Jr., Grants Administrator, OGM-SC Corrective Action Plan: The Office of Grants Management agrees with this finding. We were unable to locate these two folders due to the high volume of application files, moving between offices, and staff turnover experienced during the period of performance; however, we do have copies of the invoices, check payments, and lease agreements for these two cases. The CCERA Program does not exist anymore, it closed in December 2023 and all the documents were not fully digitized, making the retention of records partly difficult. OGM has learned that it would be more prudent to have a database software that could hold vital information for any large social assistance program. It is my understanding that the CCERA staff did verify that these clients are eligible to receive federal assistance and it was checked by their program officers and coordinators. Although, these particular files had case workers assigned to them, multiple staff had access to these folders as well. Proposed Completion Date: Ongoing

Finding No.: 2021-024 AL Program: 17.225 - Unemployment Insurance Area: Eligibility Questioned Costs: $1,131,117 Contact Person(s): Zachary Taitano, PUA Program Manager, DOL Corrective Action Plan: Condition 1: CNMI DOL agrees with audit findings for Condition 1 for all three Application IDs indicated, as upon further review, Social Security Cards were not on file for claims identified. However, per the Benefits Rights Information (BRI) Handbook, and PL 116-136 CARES Act, claimants were only required to provide their full social security number. For each claim, the full SSN of claimant is provided and self-certified, on both the Initial Application and in each Weekly Certification. Condition 2: CNMI DOL agrees with this finding. Notably, this issue was identified and addressed through Fiscal Year 2020’s Single Audit. OPC 590093 was initiated on July 31, 2020 to send a Letter of Determination via the HireMarianas Portal’s internal messaging system. Moreover, the OPC also requested for all future payments that a Letter of Determination be issued once a payment is generated per user. Condition 3: CNMI DOL agrees with this finding, with respect to the SAVE Verification being necessary. However, upon further examination: Application ID 398353: The applicant has a SAVE verification response uploaded to their HireMarianas Portal dated 05/23/2022. Moreover, upon a further review of the USCIS-SAVE Database, the other Application IDs identified did not have a SAVE Verification initiated upon initial clearance. CNMI DOL has initiated a SAVE Verification for the remaining 3 users. The results are as follows: Application ID 158179: This applicant is a Green Card holder and the SAVE response was returned immediately. A copy of the SAVE verification response for this user was uploaded to the applicant’s HireMarianas Portal on June 24, 2024. A Green Card holder meets the definition of a qualified alien. Application ID 111798: This applicant is a CW-1 VISA holder. A SAVE verification was initiated on June 24, 2024 with the WAC Number indicated on the I-797A (Notice of Action) Form for the relevant period in time. A response was returned on July 5, 2024 stating that the applicant is employment authorized. Application ID 399118: This applicant is a CW-1 VISA holder. A SAVE verification was initiated on June 24, 2024 with the WAC Number indicated on the I-797A (Notice of Action) Form for the relevant period in time. A response was returned on July 5, 2024 stating that the applicant is employment authorized. While CNMI DOL agrees with the fact that SAVE Verification was necessary prior to payment disbursement, it is important to note that all the indicated applicants were indeed qualified aliens per the PUA Program Guidelines   This issue was identified and addressed through Fiscal Year 2020’s Single Audit. OPC 590093 was initiated on July 31, 2020 to send a Letter of Determination via the HireMarianas Portal’s internal messaging system. Moreover, the OPC also requested for all future payments that a Letter of Determination be issued once a payment is generated per user. Condition 4: CNMI DOL agrees with this finding. Upon additional review of the current overpayment log, the Department was able to recollect a total of $19,354.17 from the applicants that were noted in the initial listing provided to the auditors. This leaves the updated remaining overpayment balance for FY 2021 at $1,128,975.35. Auditors were provided with the documentation to substantiate this on 06/24/2024. Recollection efforts are Ongoing. Proposed Completion Date: Ongoing

Finding No.: 2021-016 AL Program: 10.551/10.561 – SNAP Cluster Area: Special Tests and Provisions – ADP System for SNAP Questioned Costs: $1,421 Contact Person(s): Margaret Aldan, NAP Administrator Corrective Action Plan: Condition 1: The CNMI-NAP disagrees with this finding. NAP staff has to guide the auditors during the time the audit is being performed to understand the history and process of files being audited. Case ID#B100092775 Variance of $69.00 caused by change in income guideline and benefit Level Effective October 1st 2020 Income level is 781.00 benefit for Saipan is $221. Corrective action taken by Eligibility worker processed income for household of 1 as SSI which gave household $41.00 benefit. Income should be counted as SSA which at the time the adjustment was made and increased the benefit amount for the household. Case ID#B100094249 Variance of $180.00 a change in income and benefit level. Household income was $108.00 which changed to $120.00 for a household of 4. Adjustment was made to reflect changes including benefit level. From $708.00 to $1,231.00. Case ID #B100095019 Variance of $69.00 Benefit level was $212.00, and household had $20.00 contribution as unearned income. Benefit issued was 295.00 new benefit level effective October 1st, 2021 adjusted benefit issuance at $364.00 (maximum benefit for household of one for zero income is $369.00). Case ID#B100095077 Variance of $180.00. Benefit for household of 3 was issued for 2020 benefit and income level. November Benefit effectuated new income and benefit level. Issued benefit is based by household and income of head of household. Case ID#B100094664 Variance of $69.00. Household is zero income maximum benefit level issued was $300.00 reflecting 2020 benefit level. On October 1st, 2021 eligibility system automatically adjust benefit to $369.00 as per new benefit level. Case ID#B10109695 variance of $126.00 household of 2 maximum benefit was $389.00 with ineligible household members earning SS benefits totaling at $167.00 (prorated income) benefit issued was $651.00. Increase in benefit and income level was automatically adjusted by the eligibility system. Case ID#B100093732 Variance of 272.00 household of 5 maximum Benefit level for zero income Household is $1,462.00 deduction of 25 percent for over issuance ($272.00) increase of benefit level automatically adjusted by Eligibility system and still taking offset of 25% for over issued benefits. Over issuance claim is already paid off. Condition 2: The CNMI-NAP disagrees with this finding. NAP staff has to guide the auditors during the time the audit is being performed to understand the history and process of files being audited. Case ID#B100081068 Questioned cost of $162.00. Head of household declared zero income. Benefit amount under issued in the amount of $229.00 by eligibility system for maximum level of benefits should be $1,231.00. Unable to do corrective action due to beyond 2 months from time the discrepancy was found: Corrective action for eligibility system to implement a system audit that will prevent future glitches that would create a loss for both the household and NAP program budget. Condition 3: The CNMI-NAP disagrees with this finding. NAP staff has to guide the auditors during the time the audit is being performed to understand the history and process of files being audited. Case ID#B100082118 questioned cost is $162.00 Questioned cost of $294.00. household had income from ineligible parents which is prorated towards the two eligible household members. Total prorated unearned income is $843.46 which was counted towards the household’s benefits. Then household became zero income due to Furlough from COVID-19 pandemic. We disagree with the findings. When the auditor reviewed the case files, there was a misunderstanding of changes in household composition and income which is also affected by the increase in income guidelines and benefit levels between the certification period. This created the variances that the auditor noted in the findings. *CNMI NAP recommends having NAP staff guide the auditor during time the audit is being performed to understand history and process of files being audited. CNMI-NAP recently hired a Certification Unit Supervisor who had been on board for close to three months. He had been actively working closely with the EWs and especially the Management Evaluation Unit (MEU) who oversees the program reviews and quality control. Mini Trainings and assessments of the Certification Unit are in the works. One training was done sometimes in April by the MEU to ensure compliance is met. More trainings and workshops are in being planned between the Certification Unit and Management Evaluation Unit for a better process and procedures Proposed Completion Date: Ongoing

Finding No.: 2021-015 AL Program: 10.542 – Pandemic EBT Food Benefits Area: Eligibility Questioned Costs: $151,626 Contact Person(s): Margaret Aldan, NAP Administrator Corrective Action Plan: CNMI-NAP disagrees with the finding. Under the Pandemic Electronic Benefit Transfer (P-EBT) Plan, CNMI NAP received the listing of the eligible children from CNMI Child Nutrition Program (CNP). CNMI-NAP only prepared and distributed the benefits. Applications and other requirements should be obtained from CNMI Public School System under CNP office. Due to the confidentiality and sensitivity of the records, the Auditor was informed to work with Mr. Dale Roberts to review the documents. In addition, emails and correspondence with the Auditor were made to work with CNP regarding the records. NAP provided the auditor with the sample listings. NAP informed the audit team to contact PSS Child Nutrition Program (CNP) to review applications and documents pertaining to eligibility determination for P-EBT as it was PSS CNP that determined the eligibility. Contact information for PSS CNP was provided to the audit team by NAP staff. CNMI NAP wants to understand under the “Cause” of the finding. Proposed Completion Date: Ongoing

Cornerstones acknowledges that our files were incomplete. It is our position that the COVID-19 pandemic created immense need to which Cornerstones responded by expanding rapidly and mobilizing funding and program requests that did not receive the benefit of comprehensive planning; the focus was on health prevention, isolation and quarantine activities and temporary shelter for homeless and other low-income, vulnerable seniors and disabled persons. We served those in need and our intake processes and record keeping did not keep pace. Additionally, given the time that has passed since the services in question, it is possible that records that did exist were misplaced. Staff turnover, resulting from the pandemic burden, made it challenging to go back to the work that had been done. In the time since these events Cornerstones has further emphasized the compliance and documentation needs of the case management process, and we have filled turned-over positions with experienced staff that also understand intake and documentation requirements. We have also hired a Senior Director, Finance with over 20 years of federal contracts experience that is an integral part of increased program compliance and operational oversight responsibilities within the Finance/Operations function.

Finding No. 2021-001 - Activities Allowed or Unallowed - Hazard Pay Eligibility Corrective Action Plan On March 2, 2022, payments to ineligible employees were recharacterized as additional compensation paid from the Entity’s own resources, instead of federal awards. Such federal awards remain available for use under other assistance programs provided by the CARES Act through December 2020. Name (s) of the Contact Person (s) Responsible for Corrective Action Julio Colón, Chief Financial Officer Anticipated Completion Date Completed on March 2, 2022

County Judge/Executive’s Response: The Fiscal Court has contracted with Compass to ensure are compliant.

We recommend the Clerk work more closely with the award agencies to ensure the elibility of all claims for reimbursement is understood by both parties.

Of the 20 claimants the auditor determined to be ineligible for Lost Wages Assistance (LWA) benefits, 17 were Pandemic Unemployment Assistance (PUA) claimants disqualified due to identity issues discovered through the EDD’s new fraud enhancements outlined in the response to the finding for Reference Number 2021-003. The other three claimants were receiving regular Unemployment Insurance (UI) benefits (one claimant) and Pandemic Emergency Unemployment Compensation (PEUC) benefits (two claimants). Those three claimants were paid pending the adjudication of potential eligibility issues, which were later found to be disqualifying. EDD has corrected both issues that resulted in the LWA payments being made to ineligible claimants. Regarding the issue of PUA claimants paid prior to the discovery of the potential identity issues, as outlined in the response to the finding for Reference Number 2021-003, during the years 2020 and 2021, the EDD implemented multiple new fraud prevention measures. Regarding the issue of the regular UI and PEUC claimants being paid prior to the adjudication of the potential eligibility issues, the EDD resumed adjudicating all potential eligibility issues as of January 2021 and will complete the remaining retroactive workload by April 30, 2023. Estimated Implementation Date: September 2020 (Fraud Enhancements) and January 2021 (Resumption of Adjudications) Contact: Diane Underwood, Division Chief Unemployment Insurance Branch California Employment Development Department

The Office of AIDS (OA) agrees with the finding and recommendation. OA developed and implemented additional, internal quality assurance (QA) processes in April of 2022 to ensure that secondary reviews of AIDS Drug Assistance Program (ADAP) applications are consistently enforcing the existing guidelines, including acceptable supporting documentation and accurate eligibility requirements. During this audit period, and through December 2021, ADAP had issued multiple policy memos to respond to the COVID-19 pandemic, which enabled staff and enrollment workers to defer documentation collection, when necessary, to remain flexible and ensure clients impacted by the pandemic, and associated site closures, did not lose eligibility and access to life saving medications and comprehensive healthcare. These flexibilities in our guidelines were implemented based on guidance received from our federal funder, Health Resources and Services Administration (HRSA), which encouraged ADAPs to reassess their organization's eligibility and recertification policies and procedures, and remove any barriers that may impede social distancing, or other public health strategies, necessary to minimize COVID-19 transmission. This documentation deferral was terminated on December 31, 2021, and since January 1, 2022, full documentation and eligibility requirements have been enforced. This, combined with ongoing QA efforts, will help to mitigate future findings in ADAP applications dated January 1, 2022 onward. Estimated Implementation Date: Already implemented as of April 2022 Contact: Sharisse Kemp, Branch Chief AIDS Drug Assistance Program Branch California Department of Public Health

Reference No. 2021-010: Health Care Services agrees with the finding. The U.S. Centers for Medicare and Medicaid Services (CMS) has confirmed the continuous enrollment requirement is now delinked from the Public Health Emergency (PHE) in the Consolidation Appropriations Act of 2023, (enacted December 29, 2022), which ends on March 31, 2023. Health Care Services will begin the continuous coverage requirement unwinding activities, including the resumption of renewals, on April 1, 2023. Per the current county oversight timeline established within the California Advancing and Innovating Medi-Cal (CalAIM) implementation timeline, the resumption of oversight and monitoring activities shall begin 14 months after the onset of continuous coverage requirement unwinding activities; therefore, the new implementation date to initiate these activities is May 1, 2024. Estimated Implementation Date: May 1, 2024 Contact: Wendy Griffe, Chief Internal Audits California Department of Health Care Services

The EDD resumed adjudicating all potential eligibility issues as of January 2021 and will complete any remaining retroactive workload by April 30, 2023. Estimated Implementation Date: January 2021 Contact: Diane Underwood, Division Chief Unemployment Insurance Branch California Employment Development Department

Given the unprecedented volume of unemployment insurance claims during the federal disaster -approximately 20 million claims compared to 3.8 million during the Great Recession - EDD took action to speed payments to eligible claimants whenever possible. For example, EDD launched in July 2021 a Conditional Payment Program to speed payments to claimants who certified for benefits and already received at least one week of benefits in the past but whose payments were later pending for more than two weeks. EDD also boosted its capacity to process workloads, prioritized timely payments, and employed automation among other measures. As reported in Reference Number 2020-006 in fiscal year 2019-2020, EDD began automatically cross-matching EDD wage records and Franchise Tax Board (FTB) records in November 2020 to assist in verifying the income of PUA claimants. Claimants who could not be automatically verified through the FTB wage record match were required to submit additional documentation to EDD for a manual review. Regarding the manual processing of the income documents to substantiate the PUA weekly benefit amounts that have been increased above the minimum California weekly benefit amount (WBA) of $167, in June 2022, the EDD submitted a blanket waiver application to the U.S. Department of Labor (DOL), pursuant to the DOL Unemployment Insurance Program Letter 20-21, Change 1. EDD’s application is pending the DOL’s determination. If approved, our blanket waiver application would cover any overpayments for claimants who, through no fault of their own, failed to provide proof of income substantiation to support the increase or whose WBA will be decreased because the proof they provided was insufficient. Regarding the verification of employment or self-employment substantiation (known in California as “Self-employment/Employment Substantiation” or “SEES”), this verification process is being implemented in two phases. Phase 1 of the SEES effort was implemented on November 10, 2021, and involved notifying claimants registered in California’s UI Online (UIO) system by email and text of their requirement to provide SEES documentation. Phase 2 will involve notifying claimants who did not respond to the UIO request for SEES documentation, and those who are not registered in UIO, via a paper notice mailed through the United States Postal Service (USPS). EDD submitted a blanket overpayment waiver application in June 2022 to DOL regarding this issue. EDD will assess further implementation based on the DOL’s decision. If approved, our blanket waiver application would cover any overpayments for claimants who, through no fault of their own, provided insufficient documentation or did not provide any documentation. Estimated Implementation Date: To be determined once the DOL provides a decision on the waiver application. Contact: Diane Underwood, Division Chief Unemployment Insurance Branch California Employment Development Department

Since fiscal year 2020-21, EDD has implemented dozens of strict anti-fraud measures to continue to evaluate and enhance its fraud detection. These measures, described in last year’s response to finding Reference Number 2020-005, included, but were not limited to, cross matching claimant information against law enforcement and government databases and implementing rigorous new identity verification procedures. As a result, EDD caught and stopped multiple fraud attempts starting in September 2020. As previously described, EDD implemented the following measures to address the nationwide fraud attempts perpetrated against the new emergency federal benefit programs in 2020-21: • Implemented additional cross-matches in September 2020 to detect multiple claims per address. • Ceased automatically backdating Pandemic Unemployment Assistance (PUA) claims under federal rules in September 2020. • Strengthened identity verification procedures in October 2020 by implementing ID.me. • Implemented additional cross-matches in November 2020 against state inmate information. • Vetted applications against law enforcement databases and other tools provided by Thomson Reuters in December 2020 to further curb identity and non-identity fraud. • Established a 1099-G call center to help victims of identity theft deal with any tax-related questions. • Ceased printing Social Security numbers on mailed documents to reduce identity theft risk. • Enhanced benefit card security with Bank of America. • Partnered with state, local and federal law enforcement agencies to support thousands of criminal investigations, arrests, prosecutions and convictions. The EDD will continue to evaluate and enhance the fraud detection/prevention tools that have been put in place. Estimated Implementation Date: September 2020 Contact: Diane Underwood, Division Chief Unemployment Insurance Branch California Employment Development Department

The Women, Infants, and Children Division (WIC) of the California Department of Public Health (Public Health) agrees that the WIC WISE system does not currently store eligibility history that should be included in the “Cert History Report.” Currently, the initial eligibility data is overwritten when subsequent eligibility information is keyed into WIC WISE. WIC WISE does include preventative internal stops or check points that do not allow ineligible individuals to be certified and issued benefits (e.g., over income, not a CA resident, no nutrition risk factor, etc.). User acceptance testing vetted these items prior to system implementation. The certification history condition will be remediated via a system Defect Correction to WIC WISE. WIC has entered Defect Correction #6972 in Team Foundation Services (TFS), the tracking system used to capture system changes and defects. This correction is included in a release that is currently being tested and is targeted for release into production by May 2023. The defect supports a system change to ensure initial eligibility information is retained when subsequent eligibility information is entered into WIC WISE. Estimated Implementation Date: May 2023 Contact: William Welch, Assistant Division Chief, Operations Women, Infants, and Children Division California Department of Public Health

Public Health’s Accounting Office will generate the FI$Cal Year End Close report (KK_12 expenditure) and collaborate with the ELC program to ensure that all expenditures captured are complete and accurate, ensuring timely reporting of the SEFA data for FY 2023-24 and beyond. Additionally, we will update the procedures to document the SEFA reporting for the ELC program.

Auditee’s Response and Planned Corrective Action The Authority hired a new Executive Director in November 2023. Under new management, the Authority provided training to necessary staff and will discuss with the third party management company to ensure compliance with 24 CFP 982.516 in the future. Planned Implementation Date of Corrective Action: Immediately Person Responsible for Corrective Action: Kayla Potter, Executive Director

Finding 2021-006 Compliance Requirement: Special Tests and Provisions – Sliding Fee Discounts Material Weakness Assistance Living Number 93.224 Health Center Programs Grant Award Number H80CS00112 U.S. Department of Human Services Condition: Supporting documents could not be located for four of the thirty patients selected for testing. As such, we were unable to determine eligibility. Action Planned in Response to the Finding: Effective immediately, the revenue cycle team will implement and monitor procedures to ensure that all supporting documents are kept for determining sliding fee discounts and patient eligibility. Official Responsible for Ensuring the CAP: Becky Howard Planned Completion Date: June 30th, 2024