Corrective Action Plans

Recommendation Management should enhance and strengthen procedures to ensure tenant income certifications are completed within 90 days of the tenant being entered into the HUD TRACS system. Finding Resolution Status: Resolved Views of Responsible Officials Management agrees with the finding and recommendation and will ensure timely income verifications going forward.

Management concurs with the findings and had already commenced corrective actions prior to the issuance of this report. These actions were initiated to address deficiencies resulting from the inadequate performance of the former property manager, who resigned from the position. Additionally, a new property manager has been hired to ensure compliance with established procedures and to oversee the continued implementation of corrective measures.

The Capital District YMCA reviewed the vendor used for our project when the auditors brought this to our attention and we did not find any suspension or disbarment information. We will incorporate this vendor review into our process for all programs or activities related to Federal contracts. This will be done in conjunction with the procurement policy and be in place by July 31, 2025. The SVP/CFO Mary Maziejka will be responsible for development and implementation of the policy.

Finding 2024-227: The review and approval of the annual updates to the Low-Income Home Energy Assistance Program (LIHEAP) benefits matrix were not documented. Related to Prior Finding: 2023-211 Agency’s View: The Department Agrees with this Finding Corrective Action: A process was developed that includes obtaining and documenting approval by the Bureau Chief. This process was shared with LSO following receipt of the FY23 review findings. Supporting documents can be provided again as needed. Anticipated Corrective Action Date: 03/06/2025 Responsible for Corrective Action: Kristin Matthews, Programs Bureau Chief, Self Reliance kristin.matthews@dhw.idaho.gov 208-334-5553

Finding 2024-226: The Bureau of Facility Standards within the Department failed to complete timely health and safety surveys for three long-term care facilities. Agency’s View: The Department Agrees with this finding. Corrective Action: During SFY24, Bureau of Facility Standards (BFS) was still coming out of the COVID response for recertification time frames and actively recruiting new health facility surveyors to ensure proper multidisciplined teams were available to complete the overdue surveys. BFS also contracted with Healthcare Management Solutions, LLC. to supplement overdue recertification surveys. On October 3, 2025, during the government shutdown, we were able to complete the final overdue surveys to be compliant with 15.9 months between surveys. Due to the government shutdown, CMS paused recertification surveys for nursing facilities. This may restrict our ability to maintain the required recertification timeline of 15.9 months. We have recruited and maintained staffing posture but are still actively recruiting to round out of staffing to meet the statutory timelines. Anticipated Corrective Action Date: 10/31/2026 Responsible for Corrective Action: Nate Elkins, Programs Bureau Chief, Licensing & Certification nate.elkins@dhw.idaho.gov 208-364-1874

Finding 2024-222: Four providers lacked documentation to support continued eligibility within the Medicaid program. Related to Prior Finding: 2023-223 Agency’s View: The Department Agrees with this finding. Corrective Action: Medicaid is currently under a Corrective Action Plan with CMS requiring all Managed Care providers to enroll with Medicaid. This project is currently underway. The initial date of completion of having all providers enroll was 12/31/2025. However, there were unforeseen system enrollment issues that delayed the project. The go live date is now April 1, 2026. Once all providers are enrolled Medicaid will audit provider rosters throughout the year to ensure those providers are in fact enrolled within Medicaid's system. Anticipated Corrective Action Date: 10/31/2026 Responsible for Corrective Action: Alex Scott, Program Bureau Chief, Medicaid alex.scott@dhw.idaho.gov 208-364-1928

Finding 2024-219: The Medicaid Enterprise System was not properly updated for members deemed ineligible, resulting in capitation payments issued to Managed Care Organizations for ineligible members within the Medicaid program. Related to Prior Finding: N/A Agency’s view: The agency agrees with this finding. Corrective Action Plan: Medicaid recognizes that this appears to be an interface issue with Self Reliance, and their inability to send correct eligibility records to Medicaid in certain instances. Medicaid will investigate and work with Self Reliance to mitigate these issues while working through our new system implementations and interfaces. Self-Reliance is looking at the issue to identify root causes and will work closely with MC to determine next steps to implement. System integration is expected in 2028. In the interim, we’ll identify issues and develop implementation strategies by 2027. Strategies will align with system updates and builds for both Self-Reliance and Medicaid. Anticipated Corrective Action Date: 07/31/2026 Responsible for Corrective Action: Matt Clark, Programs Bureau Chief, Medicaid matthew.clark2@dhw.idaho.gov 208-332-7979

Finding 2024-217: The Department lacked documentation to support continued eligibility for providers within the Medicaid program. Agency’s View: The Department Agrees with this Finding Corrective Action: As part of the Provider Enrollment project, the division will audit provider payments starting in 2026. The health plans will be required to validate that the providers are fully enrolled with Medicaid prior to enrolling with the health plan in early 2026. These are audits will begin in May 2026 and continue through the end of the year depending on when provider reports are due to Medicaid. This is also part of the Corrective Action Plan mentioned in finding #5. The information required to validate that no payment was made inappropriately is part of the audits that will be conducted this year with the provider rosters. Anticipated Corrective Action Date: 12/31/2026 Responsible for Corrective Action: Alex Scott, Program Bureau Chief, Medicaid alex.scott@dhw.idaho.gov 208-364-1928

The tenant recertifications will be monitored by the owner to ensure they are being completed in a timely manner.

Finding Number: 2024-032 Audit Type: Single Audit Finding Title: Delayed Final Reimbursement Due to Unresolved Agency Requests Related Finding: 2024-023 (Yellow Book) 1. Contact Person Responsible for Corrective Action Name: Shannah Weaver Title: City Clerk Department: Finance Department 2. Planned Corrective Action The City will designate a grants coordinator to monitor agency requests and ensure timely responses. 3. Anticipated Completion Date September 30, 2026 4. Management's Response Management concurs and will improve communication with funding agencies. 5. Status of Prior Year Finding This is a newt finding.

Finding 5: Cost of Attendance (COA) Budget Documentation Condition: Cost of Attendance Budgets to determine students unmet need were not provided by the College. (34 CFR 685.102(b)) • New SOP requiring documentation (e.g., printout, electronic file) of the student's specific COA be included in their financial aid file. • A full reconstruction of COA budgets is underway using historical tuition and fee schedules, room and board, and survey data. • Documentation has been compiled and saved for all student budget categories and dependency statuses. • Formal COA Development Process: o COA budgets are now reviewed and approved annually by the Financial Aid Director in collaboration with the Finance Office. o Data sources include tuition/fees, room and board, bookstore pricing, transportation estimates, and student expense surveys. • Component Breakdown: o COA budgets are broken down by: § Enrollment status (full-time, part-time) § Housing status (on-campus, off-campus, with parent) • Staff Training: o Financial Aid staff trained annually on COA development and documentation requirements. • Expected date of completion: 06/2026 Finding 6: Federal Programs Expenditure Submission Condition: The Office of Financial Aid submitted unreconciled expenditures within the Fiscal Operations Report and Application to Participate (FISAP) for Federal Pell Grant, Federal SEOG and Federal Work-Study. • New SOP requiring a formal monthly reconciliation of all Federal Pell, SEOG, and FWS program expenditures between the Financial Aid ledger and the Business Office/General Ledger. • Development of a detailed FISAP preparation checklist, requiring final reconciliation sign-off by both the DFA and the Business Manager prior to submission. • Cross-training for new FA and Business Office staff on the specific accounting and reporting requirements for all Title IV program funds reported on the FISAP • Submitted an amended FISAP to correct discrepancies and reflect accurate expenditures. • Conducted a line-by-line reconciliation of all federal fund expenditures for Pell, SEOG, and FWS for the reported year. • Implemented a dual-approval process for FISAP data involving both Financial Aid and Finance teams. • Monthly Reconciliation Protocol: o Financial Aid Office and Business Office will jointly reconcile Title IV disbursements, drawdowns, and expenditures on a monthly basis. o Reconciliations will be documented and archived for audit purposes. • Training and Accountability: o Annual training on FISAP completion and reconciliation best practices for all involved staff. o One staff member from each office designated as the FISAP lead and held accountable for data accuracy. • Expected date of completion: 06/2026 Finding 7: Reconciliation of Title IV program Condition: The College did not reconcile all Title IV programs between the office of Financial Aid and the Business Office, including Federal Pell Grant, Federal SEOG, Federal Work- Study, and Federal Direct Loans. (34 CFR 685.309(b)(5)) • Conducted a full reconciliation for all Title IV programs for the 2024–2025 award year to identify and resolve discrepancies. • Verified drawdowns in G5 against actual disbursements and adjusted ledger entries where necessary. • Establish Monthly Reconciliation Process: o A formal monthly reconciliation schedule is now in place for Pell, SEOG, FWS, and Direct Loans. o Both offices jointly reconcile: § Disbursements from SIS § G5 drawdowns § COD (Common Origination and Disbursement) data § General ledger entries • Clear Division of Responsibilities: o Financial Aid Office: Responsible for accurate awarding, disbursing, and reporting to COD. o Business Office: Responsible for drawdowns, cash management, and posting to the general ledger. o Both sign off monthly on reconciliation reports. • Training and Internal Controls: o Cross-training provided to both teams on Title IV reconciliation best practices and compliance standards. o Developed and implemented internal procedures for handling discrepancies • Expected date of completion: 06/2026

Inadequate Approval Controls Over Adjusting Journal Entries and Invoices Recommendation: We recommend following documented controls to enforce approval for adjusting journal entries. We also recommend ensuring invoice processing workflows include mandatory approvals before payment. We further recommend conducting periodic audits to verify compliance with approval policies. Action Taken: CMJTS migrated to a new accounting software in February of 2025. This software has systematic approval workflows built in to ensure approvals are done on journal entries before they are posted and invoices before they can be paid.

Finding: 2024-004: Significant Deficiency in Internal Controls over Compliance – Eligibility Name of Contact Person: Tray Miller Controller Catholic Community Service 1803 Glacier Highway Juneau, AK 99801 Corrective Action: Management will ensure eligibility forms are thoroughly reviewed. Proposed Completion Date: 6/30/25

2024-002: Section 202, Assistance Listing No. 14.157 Two tenant files were selected for testing and for both the required documentation to determine eligibility, as required by the HUD regulations, could not be located as follows: • Form HUD-50059, Owner’s Certification of Compliance with HUD’s Tenant Eligibility and Rent Procedures was not updated before the tenant’s anniversary date. • There was no verification of income by a third party provided. • There was no signed move-in/move-out inspection form provided. • There was no signed lease provided. Additionally, our testing indicated that the required deposits to the replacement reserve account had not been made for the last quarter of the Corporation’s fiscal year for any tenants. Recommendation: We recommend the Corporation establish procedures and internal controls to ensure that all required documentation is maintained, and all required reserve deposits are made timely, in accordance with HUD requirements. Action Taken: Management concurs with this recommendation. Since assuming property management on June 1, 2025, ULREDC has conducted a tenant file audit. All property management staff have been properly trained to ensure compliance with certification, documentation, and inspection requirements. Missing documentation, including Form HUD-50059, income verifications, and leasing inspections, is being corrected. Replacement reserve deposits were delayed because properties were not cash flowing. As leasing stabilizes, deposits will resume and be verified once RealPage is fully active. RealPage will serve as the compliance and record-retention platform. Quarterly internal compliance reviews will be instituted to confirm file accuracy and documentation completeness.

MATERIAL WEAKNESS 2024-002: Section 202, Assistance Listing No. 14.157 One tenant file was selected for testing and the following findings were noted: • Form HUD-50059, Owner’s Certification of Compliance with HUD’s Tenant Eligibility and Rent Procedures was not updated for the year tested • Move-in/move-out inspection form was not provided • Lease was not provided • Annual recertification of income by a third party was not provided Additionally, our testing indicated that the required deposits to the replacement reserve account had not been made for the last quarter of the Corporation’s fiscal year for any tenants. Recommendation: We recommend the Corporation establish procedures and internal controls to ensure that all required documentation is maintained, and all required reserve deposits are made timely, in accordance with HUD requirements. Action Taken: Management concurs with this recommendation. Since assuming property management on June 1, 2025, ULREDC has conducted a tenant file audit. All property management staff have been properly trained to ensure compliance with certification, documentation, and inspection requirements. Missing documentation, including Form HUD-50059, income verifications, and leasing inspections, is being corrected. Replacement reserve deposits were delayed because properties were not cash flowing. As leasing stabilizes, deposits will resume and be verified once RealPage is fully active. RealPage will serve as the compliance and record-retention platform. Quarterly internal compliance reviews will be instituted to confirm file accuracy and documentation completeness.

2024-002: Section 202, Assistance Listing No. 14.157 Two tenant files were selected for testing and signatures, as required by HUD regulations, were missing from Form HUD-50059, Owner’s Certification of Compliance. Additionally, our testing indicated that the required deposits to the replacement reserve account had not been made for the last quarter of the Corporation’s fiscal year for any tenants. Recommendation: We recommend the Corporation establish procedures and internal controls to ensure that all required documentation is maintained, and all required reserve deposits are made timely, in accordance with HUD requirements. Action Taken: Management concurs with this recommendation. Since assuming property management on June 1, 2025, ULREDC has conducted a tenant file audit. All property management staff have been properly trained to ensure compliance with certification, documentation, and inspection requirements. Missing documentation, including Form HUD-50059, income verifications, and leasing inspections, is being corrected. Replacement reserve deposits were delayed because properties were not cash flowing. As leasing stabilizes, deposits will resume and be verified once RealPage is fully active. RealPage will serve as the compliance and record-retention platform. Quarterly internal compliance reviews will be instituted to confirm file accuracy and documentation completeness.

2024-002: Section 202, Assistance Listing No. 14.157 One tenant file was selected for testing, and none of the required documentation to determine eligibility, as required by the HUD regulations, was provided. Additionally, our testing indicated that the required deposits to the replacement reserve account had not been made for the last quarter of the Corporation’s fiscal year for any tenants. Recommendation: We recommend the Corporation establish procedures and internal controls to ensure that all required documentation is maintained, and all required reserve deposits are made timely, in accordance with HUD requirements. Action Taken: Management concurs with this recommendation. Since assuming property management on June 1, 2025, ULREDC has conducted a tenant file audit. All property management staff have been properly trained to ensure compliance with certification, documentation, and inspection requirements. Missing documentation, including Form HUD-50059, income verifications, and leasing inspections, is being corrected. Replacement reserve deposits were delayed because properties were not cash flowing. As leasing stabilizes, deposits will resume and be verified once RealPage is fully active. RealPage will serve as the compliance and record-retention platform. Quarterly internal compliance reviews will be instituted to confirm file accuracy and documentation completeness.

Finding No. 2024-006 Housing Trust Fund Program Federal Assistance Listing Number #14.275 Statement of Condition In connection with our lease file review, we noted two instances of four tenants tested where management did not provide support that they performed a 3rd party income verification in accordance with policy. Corrective Action Plan As a result of the 2024 audit, a new process is set up to ensure that new employees receive HUD annual training. Management will continue to ensure that 3rd party income verification is performed in accordance with policy.

Finding No. 2024-005 HUD HOME Investment Partnerships Program Federal Assistance Listing Number #14.239 Statement of Condition The owner was unable to provide a listing that detailed the available to HOME tenants the contracted number and type of HOME units and therefore we were unable to test the HOME program compliance for the audit year. Corrective Action Plan REACH utilizes a 3rd party property management company to manage the two properties located in Washougal, Washington. Management is setting up a new process to ensure that the 3rd party property management company can provide all required information.

Finding No. 2024-004 HUD HOME Investment Partnerships Program Federal Assistance Listing Number #14.239 Statement of Condition The owner did not make available to HOME tenants the contracted number and type of HOME units. This is considered a temporary noncompliance as follows: "Next Available Unit" rule: The owner must rent the next comparable or smaller unit that becomes vacant to a low-income household. Temporary noncompliance: The unit is temporarily out of compliance with HOME requirements, but the property can regain compliance by following the "next available unit" rule. Unit conversion: If the owner fails to comply and rents a comparable vacant unit to a non-low-income tenant, the over-income unit loses its low-income status and the building's compliance is reduced. A two bedroom unit did become available in 2024 and this tenant was not relocated. Corrective Action Plan A new review process is in placed to review the HOME units that will be re-classified the next time there is a vacant unit of the corresponding size/type.

Finding No. 2024-003 HUD HOME Investment Partnerships Program Federal Assistance Listing Number #14.239 Statement of Condition The owner did not make available to HOME tenants the contracted number and type of HOME units. Corrective Action Plan A new process is in placed to review HOME unit count when a unit becomes available.

Finding No. 2024-002 HUD HOME Investment Partnerships Program Federal Assistance Listing Number #14.239 Statement of Condition In connection with our lease file review, we noted six instances of eight tenants tested where management did not provide support that they performed a 3rd party income verification in accordance with policy. Corrective Action Plan As a result of the 2024 audit, a new process is set up to ensure that new employees receive HUD annual training. Management will continue to ensure that 3rd party income verification is performed in accordance with policy.

Federal Program – Supportive Housing for Veterans (Supportive Services for Veterans Families) (SSVF) Assistance Listing Number – 64.033 Significant Deficiency Criteria: The SSVF Program Guide Section VIII, Subsection E. Documentation Required states: Grantees must use adequate financial management systems that follow generally accepted accounting principles (GAAP) and provide adequate fiscal control and account records including cost accounting records supported by documentation. Grantees must also maintain all back up documentation and invoices to support the costs paid with SSVF funds.” Condition: During the OBO review, OBO found the Organization was unable to provide a general ledger detail that separated administrative costs from general costs. Cause: Because the Organization’s SSVF administrative costs are allocated payroll expenses, management was unaware they needed to segregate the administrative costs in the general ledger. Effect: The Organization’s failure to provide a general ledger that separates administrative and general expenses increases the risk of inaccurate financial results being provided at closeout or unauthorized and ineligible expenses being charged to the award, which may result in subsequent funding shortages for other qualified expenses. Questioned Costs: None Identification as a repeat finding: This is a repeat finding. Corrective Action: As of 2/17/2025 OKVU added sub-coding to the general ledger to identify administrative labor costs under 7000 – Salaries & wages, 7100 – Fringe benefits and 7200 – Payroll taxes bases on direct allocations provided to the payroll system. This information will be provided by report from the payroll system and added via journal entry to the GL.

Federal Program – Supportive Housing for Veterans (Supportive Services for Veterans Families) (SSVF) Assistance Listing Number – 64.033 Significant Deficiency Criteria: The SSVF Program Guide (March 2021) Section V, Subsection C. Determining Income Eligibility, provides a summary of asset inclusions and exclusions for use in evaluating assets. Assets must be evaluated at entry to SSVF and at recertification. Condition: The Office of Business Oversight (OBO) performed a review to assess the Organization’s compliance with SSVF program and other federal requirements and regulations. During this review, OBO found 45 case files missing evidence that the grantee evaluated assets (inclusions and exclusions) for certification of eligibility. Cause: Management misinterpreted the guidance and was not aware of the need to document asset evaluations if the veteran did not have any assets. Effect: The Organization’s failure to obtain and keep the adequate income supporting documentation in the case file may result in the Organization providing services to an ineligible veteran or household. Questioned Costs: None Identification as a repeat finding: This is a repeat finding. Corrective Action: As of 12/06/2024 OKVU implemented the addition of the Asset Calculation Worksheet to the veteran case file. To ensure compliance the requirement was also added to the discharge file QC checklist and the SSVF policy and procedure manual updated. As of 12/11/2024 all case manager staff were provided training.

Views of Responsible Officials and Planned Corrective Actions: The School District will immediately begin reissuing and recollecting the forms for the education stabilization grant for 2026, as well as into future periods.