Corrective Action Plans

Dear Mr. Waguespack: The Louisiana Department of Health (LDH) acknowledges receipt of correspondence from the Louisiana Legislative Auditor (LLA) dated February 7, 2025 regarding a reportable audit finding related to Inadequate Controls over Waiver and Support Coordination Service Providers. LDH appreciates the opportunity to provide this response to your office’s findings. Finding: Inadequate Controls over Waiver and Support Coordination Service Providers Recommendation: LDH should ensure all departmental policies for waiver and support coordination services are enforced, including documentation to support claims and evidence that deviations from the approved POC meet the needs of the recipient. LDH should consider additional provider training regarding documentation requirements. LDH Response: The LDH through the Office for Citizens with Developmental Disabilities (OCDD) concur in part with the finding and recommendation set forth by the LLA. LDH/OCDD does not concur with three errors LLA noted in the determination of inadequate controls over waiver and support coordination providers and have concerns with LLA’s overreliance on documentation in determining control adequacy. Under §1915(c) of the Social Security Act and 42 CFR §441.302, the approval of an HCBS waiver requires that CMS determines the state has made satisfactory assurances concerning the protection of participant health and welfare, financial accountability, and other elements of waiver operations. Renewal of an existing waiver is contingent upon review by CMS and a finding by CMS the assurances have been met. By completing the HCBS waiver application, the state specifies how it has designed the waiver’s critical processes, structures, and operational features in order to meet these assurances. Despite highlighting CMS approved controls and assurances, as well as LDH policy allowances, LLA continues to overlook other control mechanisms in place and rely solely on reconciling documentation to determine control adequacy. 1. “For 121 claims for 9 recipients, the waiver services provider did not provide documentation substantiating the reason for departures from the approved POC.” There is no error because there was no departure from the plan of care. The nine (9) recipients referenced herein received the individual and family support (IFS) service(s) as outlined in the plan of care. The confusion here seems to stem from the structure of our IFS service. As approved in our 1915(c) waiver, IFS can be provided on a 1:1 basis or a shared basis (i.e. one direct support worker providing IFS to two waiver recipients). There is no difference in the service definition for 1:1 and shared IFS, nor a reduction in the scope or intensity of care. In other words, it is the same service. It appears LLA has based its determination of departures from the comprehensive plan of care (CPOC) on the typical weekly schedule portion of CPOC. The typical weekly schedule serves as a map to determine the amount of supports needed, but it does not prohibit a recipient from altering the amount and type of IFS hours utilized within a day, week or month, so long as the recipient does not exceed the budgeted hours for the quarter. Understanding the dynamic nature of individuals’ lives, LDH/OCDD’s expectation is that people operate within their allocated budget or budget hours for the quarter, not the typical weekly schedule. Health and safety is assured through OCDD’s Support Coordination Monitoring (Policy 604) process. The Support Coordination Monitoring Process evaluates if waiver participants receive the supports and services necessary to meet their needs (health and safety) and achieve their personal goals. Support Coordination Monitoring provides required evidence to the Centers for Medicare and Medicaid Services that the agencies are operating in accordance with applicable federal regulations/policies. For this monitoring process a composite sample that includes individuals served by all SC agencies are reviewed. The components of the monitoring process include an Agency Review, Record Review, Participant Interview, and Support Coordination Interviews. The process in place is included in our 1915 c waiver applications and has been approved by CMS. 2. “For 50 claims for 3 recipients, the waiver services provider billed the claim at the incorrect rate.” There was no error since the waiver provider billed the appropriate rate for the procedure code and modifier submitted on the claim. Furthermore, there are adequate controls in place by way of max allowed rate coding which prohibits a provider from billing above the maximum-allowed rate for the procedure code and applicable modifier. Based on a review of the available data, it appears LLA has based its determination of improper rate on an individual 1:1 IFS rate. For the instances where the LLA noted the improper rate was paid, the procedure code and modifier identified was for a shared IFS service, which was the service the provider delivered. The rate billed aligned with the shared IFS rate. 3. “For 4 claims for 1 recipient, the waiver services provider inappropriately billed for services that overlapped with non-waiver institutional services.” While the claim was paid, the example provided was not an error, as LDH’s established controls identified and addressed the overlap in billing. LDH allows the delivery of direct care services by an in-home provider prior to the time of admission and after the time of discharge. The claim identified with date of service April 25, 2024 was the date of admission and the claim, with date of service (DOS) April 27, 2024, was the date of discharge. The agency billed Gainwell for the DOS for April 26, 2024 and Gainwell reimbursed the agency for that DOS. However, LDH has mechanisms in where claims paid but should have been denied cause future units to be blocked once the system recognizes the participant was inpatient during the date of the claim. SRI notifies the provider of the block (on the LaSRS® Blocked Report) and of their need to reimburse Gainwell, if the claim has already been billed and paid. Once they have repaid the blocked units at Gainwell, they will have enough units available to bill for the claims at the end of the prior authorization (PA). This logic (or “block”) was implemented when the inpatient stay was billed and sent to our data contractor, SRI. SRI reduced the total amount released on this PA and the provider is currently being denied for later dates of service under this PA and will not be able to be reimbursed for the dates of service until they pay back the claims for April 26, 2024. LDH/OCDD concurs with LLA’s error finding of inadequate documentation on 383 claims for 13 recipients. Included in OCDD’s response to the last audit, OCDD developed a corrective action plan which consisted of the following elements: • Develop/Finalize a standardize note to be utilized by all personal care type providers. The standardized note is developed. Starting February 2025, providers are required to begin using the note or electronic alternative/equivalent. • Training/Implementation of standard progress note. Training is underway and scheduled to be completed by end of January 2025. • Develop/Implement a monitoring process to review provider records/notes. Planned Implementation of monitoring process is July 2025. LDH concurs with LLA’s recommendation regarding policy enforcement and additional support coordination (SC) training. Corrective Action Plan: LDH developed the action steps below to address the need for SC documentation training and provide additional oversight for policy enforcement. 1. OCDD will revise the SC policies/procedures and interpretive guidelines to address findings from monitoring, including SC documentation requirements by February 2025. 2. OCDD will circulate revised policies/procedures and interpretive guidelines to LGEs and SCAs to provide feedback/recommendations by March 2025. 3. Finalize the policies/procedures and interpretive guidelines by May 2025. 4. Provide statewide training regarding policies/procedures in June 2025. 5. Implement revised policies/procedures and interpretive guidelines in July 2025. 6. Measure effectiveness by comparing results of monitoring post-revised guidelines with monitoring that occurred prior to the changes in December 2025. Bernard Brown, Deputy Assistant Secretary, OCDD is responsible for the execution and implementation of this corrective action. You may contact Bernard Brown, OCDD Deputy Assistant Secretary, at (225) 342-8807, or via email at Bernard.Brown@la.gov with any questions about this matter.

Mr. Waguespack: I am in receipt of the letter dated January 24, 2025 from Angel Cavaretta, Audit Manager, related to the misappropriation of research and development cluster funds. Louisiana Tech concurs with the recommendation. The misappropriation of funds occurred as a result of a sophisticated cyber fraud scheme in which perpetrators submitted fraudulent email requests directing that funds be deposited via electronic funds transfer (EFT) into accounts purportedly affiliated with the out-of-state University. However, the accounts were later discovered to have no connection to the institution. These deceptive actions exploited the University's payment processing systems and evaded detection at the time. Upon information a d belief, the data breach originated with the out-of-state University, and it is also noted that the out-of-state University did not detect discrepancies in its invoicing processes, including non-payment or fraudulent communications, which may have contributed to the fraud's success. Upon discovering the fraud, the University promptly reported the incident to appropriate law enforcement authorities, the Legislative Auditor, and the federal grantor. The University immediately reviewed all suppliers with an EFT payment type and has temporarily suspended the approval of any supplier requests related to the EFT payment option. As stated in the finding, the University is evaluating internal and external opportunities to further enhance its internal controls and verification procedures to better safeguard against increasingly sophisticated cyber threats targeting payment remittance processes.

Dear Mr. Waguespack: The Louisiana Department of Health (LDH) acknowledges receipt of correspondence from the Louisiana Legislative Auditor (LLA) dated January 16, 2025 regarding a reportable audit finding related to Noncompliance with and Inadequate Controls over Maternity Kick Payments. LDH appreciates the opportunity to provide this response to your office’s findings. Finding: Noncompliance with and Inadequate Controls over Maternity Kick Payments Recommendation: LDH should strengthen existing policies and procedures to ensure all maternity kick payments are supported with an eligible triggering event before payment is made to the MCOs. LDH Response: LDH does not concur with the finding of noncompliance with or inadequate controls over maternity kick payments. Maternity kick payments are triggered by a monthly automated procedure that reviews delivery encounters against specific criteria and makes payments to the MCOs when qualifying deliveries are identified. Each quarter, LDH/Gainwell performs a kick payment review procedure to recover payments from the MCOs when the original delivery encounter is voided without a qualifying replacement encounter or without another qualifying encounter in the same delivery event/episode of care. The kick payments identified in LLA’s finding had already been identified by our internal review procedures and flagged for recovery during the September 2024 kick payment review. Specifically, our review determined that these 24 kick payments were inappropriately triggered due to a coding change that was intended to limit the lookback period for qualifying encounters to January 1, 2023 (to align with the current MCO contract period), but was also unintentionally bypassing the 6/1/15 DOS (Date of Service) restriction for global maternity codes on professional/physician encounters. This coding error was discovered by Gainwell after LDH staff noted that the majority of kick payments flagged for recovery had a July 16, 2024 payment date and questioned that anomaly. Since LDH’s normal review and control procedures led to the identification the logic error and the appropriate recovery of the erroneous kick payments, we do not agree that controls are inadequate or that LDH is non-compliant with its policies and procedures for maternity kick payments. Additionally, LLA’s identification of many of these kick payments is simply due to the timing of its analysis as compared to the timing of LDH’s final SFY24 quarterly review in early June 2024. Had LDH/Gainwell performed its review at the end of June 2024 instead of the beginning of the month, 16 kicks with payment dates in June 2024 would not have been identified in LLA’s review. Corrective Action: Corrective action is not necessary, as recoveries were identified and processed as part of the regularly scheduled review process; however, LDH will modify the timing of its final quarterly reviews to ensure that payment/voids in June do not result in a finding. You may contact Kimberly Sullivan, Medicaid Director at (225) 219-7810 or via e-mail at Kimberly.Sullivan@la.gov or Marisa Naquin, Medicaid Program Manager 2 at (504) 408-1828 or via email at Marisa.Naquin@la.gov with any questions about this matter.

Dear Mr. Waguespack: The Louisiana Department of Health (LDH) acknowledges receipt of correspondence from the Louisiana Legislative Auditor (LLA) dated February 6, 2025 regarding a reportable audit finding related to Inadequate Internal Controls over Eligibility Determinations. LDH appreciates the opportunity to provide this response to your office’s findings. Finding: Inadequate Internal Controls over Eligibility Determinations. Recommendation: LDH should ensure its employees follow procedure relating to eligibility determinations and redeterminations in the Medicaid and CHIP programs to ensure the case records support the eligibility decisions. LDH Response: LDH concurs in part with LLA’s finding of inadequate controls over eligibility determinations. For one Medicaid and five CHIP findings noted as the renewal not properly documented, LDH does not concur. LLA noted an error for a “SNAP” or “ELE” renewal documented as a “Streamlined” renewal. “SNAP”, “ELE”, and “Streamlined” renewals are all forms of an ex parte renewal per federal regulations at 42 CFR §435.916(b)(1) which requires the Medicaid agency to complete a renewal on the basis of information available to the agency without requiring information from the beneficiary. LDH uses these labels internally to identify what information or process used to complete the ex parte renewal. LDH presented documentation from system logs, which showed a system bug misidentified the ex parte process used but there was no error in the determination made. For one CHIP finding noted as inadequate documentation regarding income to support the renewal determination, LDH does not concur. The auditor cited a separate case in which a Medicaid analyst requested a written affidavit for the ending of self-employment income but not requested in this case. There is nothing in LDH policy or procedure that requires a written affidavit to verify ending of self-employment income. Corrective Actions: LDH already has a continual process of reviewing findings from internal case reviews, system bugs, appeal cases, external audits, or other sources then incorporating into policy/procedure updates, refresher trainings, reminder memos, and/or staff meetings. The findings from this audit will be added to this process. In addition, by April 1, 2025 Eligibility Program Operations will issue a summary of these findings to eligibility staff statewide reiterating the need to follow procedures and regulations relating to eligibility determinations to ensure the case records support the eligibility decisions. You may contact Kimberly Sullivan, Interim Medicaid Director at (225) 219-7810 or via e-mail at Kimberly.Sullivan@la.gov or Rhett Decoteau, Medicaid Section Chief at (225) 342-9044 or via email at Rhett.Decoteau@la.gov with any questions about this matter.

Dear Mr. Waguespack: The Department of Children and Family Services (DCFS) has received the finding titled "Unauthorized Employee Fuel Transactions." The finding states that the Department of Children and Family Services (DCFS), Bureau of Audit and Compliance Services, investigated and identified multiple instances of unauthorized fuel transactions made by a former DCFS employee, estimated at approximately $97,500 in fiscal year 2024. Of that total, $5,191 was charged to the Social Services Block Grant program and $32,555 was charged to the Foster Care program through the cost allocation process. DCFS concurs with the finding and has zero tolerance for unauthorized use of state or federal funds. The department's Fleet Manager has developed monitoring reports to review transactions on a monthly basis. The results of these reviews will be communicated with the Director of Administrative Services who will ensure compliance with the established policies and procedures governed by the Fleet Card Program. The department has also established adequate segregation of duties to the Fleet Coordinators in the field offices. Any DCFS employee engaged in such an unauthorized use of state and federal funds would be terminated. If you have any additional questions, please reach out to Director of Administrative Services. Tina Hebert, who oversees Fuel Purchasing Program. You can reach her at (225) 342-1875 or Tina.Hebert.DCFS@la.gov.

Dear Mr. Waguespack: Thank you for the opportunity to offer the University's response to the referenced finding. FINDING: Control Weaknesses over and Noncompliance with Return of Title IV Funds RESPONSE: Southern University - Baton Rouge (SUBR) concurs with the above noted finding. Management concurs with the finding and the recommendation to ensure alignment between our academic calendars and financial aid policies to maintain compliance with federal regulations. To address this matter, the following corrective actions are being implemented: 1. Alignment of Academic Calendars - The Office of the Registrar is working in collaboration with the Division of Academic Affairs to establish a clear mechanism for aligning academic calendars with financial aid calculations. This effort will ensure that the mid-point and 60% completion date are identified using calendar days rather than instructional days, eliminating discrepancies between the financial aid calendar and the academic calendar published in the student information system (Banner 9). 2. Faculty Training and Acknowledgment - To reinforce the importance of accurate attendance reporting and grading, the Office of the Registrar and the Division of Academic Affairs will develop a structured training document for faculty each term. Faculty members will be required to review and sign an acknowledgment form detailing their responsibilities related to attendance tracking and grade submission in the Banner 9 system. 3. Enhancements to the Withdrawal Process - The Official Withdrawal Form will be updated to require documented evidence of a student's written request to withdraw. Additionally, administrative withdrawal and drop policies will be revised to define a specific timeframe for submission, ensuring timely processing and compliance. The anticipated completion date for full implementation of these corrective actions is February 28, 2025; however, this will remain an ongoing process subject to continuous review and refinement to ensure institutional compliance. The individuals responsible for overseeing these corrective actions are: • Dr. Luria Young, Vice Chancellor for Academic Affairs • Dr. Anthony Jackson, Interim Vice Chancellor for Enrollment Management • Dr. Scott Wicker, Associate Vice Chancellor for Accountability and Accreditation • Taishieka Davis, Director of Financial Aid • Johlana Turner, Interim Registrar We appreciate the opportunity to address this matter and will continue our efforts to strengthen our compliance processes. Should you require any further information, please do not hesitate to contact us. If you have any questions or require additional information, please contact Mrs. Desiree Honore Thomas at 225-771-3571.

Dear Mr. Waguespack: LSUS takes very seriously our responsibility of returning Title IV Funds in the required time frame. LSUS is proud of the fact that during the time frame of September 2014 to May 2024, the university disbursed more than $445.5 million to students or families. A report of outstanding checks was being generated by the Department of Accounting Services on an ad hoc basis and sent to the Department of Financial Aid. However, there was a misunderstanding about which department was following up. Therefore, each department thought the other department was following up on the outstanding checks. Finding: Failure to Return Title IV Funds in Required Time Frames Management Response: Management concurs with the finding. The University will develop and implement an updated process to return all Title IV funds that are not received by a student or parent to the USDOE within the required timeframes. Responsible Personnel: Veronica Crabtree, Associate Vice Chancellor of Financer & Executive Director of Accounting Services and Lisa Pickering, Executive Director of Financial Aid. Implementation Date: March 31, 2025

Dear Mr. Waguespack, Please find below the University's management response to the audit finding titled "Control Weakness and Noncompliance with Personnel Expenses Charged to Federal Awards." Management Response: The University partially concurs with the finding. The audit finding states that UL Lafayette did not perform time and effort certifications for the period January 1, 2024, through June 30, 2024. However, we clarify that these certifications were not intentionally omitted. As outlined in our prior response, the University has been transitioning from a manual to an electronic effort certification system. In the transition, we had opted shifting from a fiscal year-based reporting framework to a calendar-year-based framework. The effort certifications for the period in question are scheduled for completion by April 15, 2025, at which point they will fully support that salaries and wages charged to federal awards are based on records accurately reflecting work performed. Corrective Actions: • The University has developed a structured plan to complete the January 1, 2024 — June 30, 2024 effort certifications, ensuring compliance with 2 CFR §200.430(i), which requires after-the-fact confirmation of personnel costs. • The Standard Operating Procedure (SOP) will be updated to require biannual effort reporting, enhancing monitoring of personnel effort. • The University will retain the full calendar-year effort reports (January 1, 2024 — December 31, 2024), including the January 1, 2024 — June 30, 2024 period, electronically on file for audit and compliance purposes. Planned Actions: • Completion of Effort Certifications: The University will finalize and retain the calendar-year effort reports for January 1, 2024 — December 31, 2024, by April 15, 2025, ensuring compliance with federal regulations and addressing audit concerns. • Transition to Biannual Effort Reporting: Effective FY 2025, UL Lafayette will implement biannual effort reporting to enhance compliance and personnel effort monitoring. The updated SOP will reflect this change. • The University will make every effort to secure effort certification for Key personnel leaving the university prior to their departure. The University remains committed to making continuous improvements and appreciates your understanding and support as we address these challenges.

Dear Mr. Waguespack, Please find below the University's management response to the audit finding titled “Noncompliance with Period of Performance Requirements." Management Response: The University concurs with the audit finding. Expense Posting Delay ($28,833): This salary charge reflects work performed within the approved award period. The delay occurred because the Personnel Action Form was received after the June payroll run, resulting in disbursements in July and August. Although the work was completed on time, the payroll posting did not align with the period of performance requirements. We are reviewing our processes to ensure all required documentation is received and processed promptly. Liquidation of Obligations ($34,957): The University failed to liquidate obligations totaling $34,957 within 120 days following the period of performance. This shortfall is due to staffing challenges in the Sponsored Programs Finance Administration and Compliance (SPFAC) Department. The University is actively exploring strategies to attract and retain qualified grant accountants to improve timely fund closeouts. Additional Mitigation Measures 1. Engaging External Consultants: o The University will engage an outside consultant to assess the university's research and administration structure, identifying opportunities to enhance processes and ensure compliance. o The University is retaining interim professional staffing to assist with invoicing and pre-audit review and to provide functional and technical expertise. 2. Deployment of an Electronic Research Administration System (eRA) o The University has begun identifying and implementing an electronic research administration system to transform grant management by offering a centralized platform that automates the entire lifecycle from proposal to closeout, minimizing manual errors while ensuring policy compliance and providing clear portfolio visibility through comprehensive reporting capabilities. The SPFAC Director will oversee the implementation of these corrective actions.

Finding 2024-002: Healthy Start Fringe Rate Grantor: Department of Health and Human Services Program Title: Healthy Start Initiative Award Name: Healthy Start Initiative‐Eliminating Racial/Ethnic Disparities Award Number: H4927805 Assistance Listing Title: Healthy Start Initiative Assistance Listing Number: 93.926 Award Year: April 1, 2023 – August 31, 2024 Passthrough Entity: None Management agrees with the finding and recommendation. The fringe benefits were originally budgeted at 27% on the initial grant application in 2019 which has been approved by the awarding agency. The actual fringe rate posted to each department increased to 29% in FY2024. Management utilized the 29% fringe rate to charge the award based on a provision noted on the award granting the permission to re-allocate up to 25% of the award amount in each budgeted category. Management will establish a quarterly review process owned by Finance to ensure the appropriate or agreed-upon negotiated fringe rate is being charged for all awards. Management will contact DHHS for instruction on returning the funds as the FY25 benefit calculation will be adjusted to remove $5,906 of excess benefits for the Healthy Start grant. Management will remediate this finding by June 30, 2025.

Housing Voucher Cluster – Assistance Listing Numbers 14.871/14.879 Compliance Requirement: Special Tests and Provisions – Rolling Forward Equity Balances Recommendation: We recommend the Authority review the equity roll forward of programs to identify and correct errors in the correct reporting period. Views of responsible officials: There is no disagreement with the audit finding. Action planned/taken in response to finding: After the end of the Audit period, HCV and Finance staff worked together to correct equity roll forward concerns. All reporting to HUD has been corrected and a process is in place to reconcile the accounts monthly so that adjustments can be timely made. Name(s) of the contact person(s) responsible for corrective action: Elaine Bouse, Accounting Manager Tyeshia Brunson, HCVP Lead Admin Corrie Temples, Regulatory Analyst (support) Planned completion date for corrective action plan: Currently implemented and ongoing.

Housing Voucher Cluster – Assistance Listing Numbers 14.871/14.879 Compliance Requirement: Eligibility Recommendation: We recommend the Authority implements controls to ensure that tenant files contain all required documentation. Views of responsible officials: There is no disagreement with the audit finding. Action planned/taken in response to finding: No later than May 2025, SC Housing is restructuring the HCV department. This realignment will reassign the staff member responsible for oversight of the HCV Administrative staff. In addition, all staff will receive additional training for all administrative functions, in order to minimize the number of errors moving forward. Regarding these specific exceptions, staff is working to collect necessary documentation to correct the records, one exception was previously corrected on 11/1/24. Name(s) of the contact person(s) responsible for corrective action: Lisa Wilkerson, Director of Rental Assistance and Compliance Director of HCVP Administration and Services Planned completion date for corrective action plan: Restructure in planned for late April, initial training will begin immediately and continue as needed.

Housing Voucher Cluster – Assistance Listing Numbers 14.871/14.879 Compliance Requirement: Special Tests and Provisions – Housing Quality Standards (HQS) Enforcement Recommendation: We recommend the Authority implements controls to ensure that the Authority requires HQS deficiencies to be corrected within the timeframe set forth by 2 CFR section 982.404(a). We recommend the Authority implements controls to ensure abatement is timely for units that do not correct the cited HQS deficiencies within the required timeframe. Views of responsible officials: There is no disagreement with the audit finding. Action planned/taken in response to finding: Management commits to re-review applicable CFR and Admin Polices to assure we are starting from a good foundation and adjust HQS and Abatement processes as needed to assure compliance. Management to provide refresher process training on HQS Re-Inspection and Abatement timelines and documentation required to be in OnBase. No later than May 2025, SC Housing is restructuring the HCV department. This realignment will result in a dedicated inspection team that is not burdened with ancillary administrative tasks that have contributed to their inability to meet critical deadlines. Additionally, inspectors will have the flexibility to inspect 4-5 days per week as necessary. One of the key inspectors is physically located in the Low Country area which will minimize the travel time required to inspect in this region. Additionally, two of the employees associated with these errors are scheduled to be reassigned and will not be conducting on-site inspections in the future. Name(s) of the contact person(s) responsible for corrective action: Lisa Wilkerson, Director of Rental Assistance and Compliance Lenzy Morris, Director of HCVP Operations Planned completion date for corrective action plan: Restructure in planned for late April, initial training will begin immediately and continue as needed.

Finding 2024-002 Procurement ALN: 93.855 Finding: The College did not have effective internal controls and procedures in place to ensure the College maintained records for procurements sufficient to detail the history of procurement, including the rationale for the method of procurement and other required elements. Corrective Action Plan: BCM management agrees that a sole source documentation form was not completed for this procurement. We do believe that this would have been easily justified as a sole source procurement as this vendor had unique capabilities required by the grant. The master service agreement for this procurement was effective September 1, 2019, and the related PO for this scope of work was issued on June 15, 2023. Since this time period, BCM has implemented a new procure to pay system with improved internal controls and approval routings. With this new system, we believe we have already put in place the appropriate corrective actions necessary to prevent this from happening going forward. Person Responsible: Rob Falivene, Vice President, Supply Chain Services, Baylor College of Medicine Expected Completion: March 2025

Authority's Response and Planned Corrective Action: The Authority accepts the recommendation of the auditor. The Authority will increase oversight in the Section 8 Housing Choice Vouchers Program to ensure that established internal control policies included within the Plan are being followed. Karen Raugh, Executive Director, is responsible for implementing this corrective action by June 30, 2025.

Deficiencies were also in the 2022-2023 school year in regard to actions of former employees improperly receiving compensation for time not worked during the afterschool program and inaccurately reporting attendance for the afterschool program. Immedately upon finding the deficiencies, all deficiencies were corrected during FY 23.

Allowable Activities and Costs Health Centers Cluster – Assistance Listing No. 93.224 and 93.527 Recommendation: We recommend the Organization implement a comprehensive and thorough process to review all wages charged to federal and state grant prior to initiating a drawdown request or submitting a reimbursement request to the grantor. As part of this, the Organization should implement a process to review changes to salary and wage information as changes are made or identified.. Action taken in response to finding: The process has been changed as of July 1, 2024 and will continue forward. Name(s) of the contact person(s) responsible for corrective action: Daria Sztaba, CFO Planned completion date for corrective action plan: July 1, 2024

We will ensure all vouchers are reviewed by a secondary individual, all supporting backup is maintained for each claim, and all payroll amounts agree to approved contracts.

The New Jersey Department of Community Affairs (DCA) has revised its processes and procedures related to earmarked funds. Specifically, the spending plan formula has been updated to ensure that the earmark for Administration and Planning does not exceed the allowable 10% threshold. Additionally, the FY 2024 spending plan has been updated, and accounts have been reconciled to reflect the Administration and Planning earmark within the 10% threshold. COMPLETION DATE/ CONTACT PERSON February 26, 2025 Fidel Ekhelar (609) 815-3905 Fidel.Ekhelar@dca.nj.gov

The New Jersey Department of Labor and Workforce Development (DLWD) has reviewed the controls in place for the Pandemic Unemployment Assistance (PUA) and Federal Pandemic Unemployment Compensation (FPUC) programs that expired with payments for CWE 9/4/21. The system controls in place for FPUC continues to require that an underlying UI/PUA payment must first be issued before any FPUC payment could be generated. Similar controls were in place for any PUA payments, where claimants have to choose a valid pandemic related reason for being unemployed before any PUA payment could be issued. These controls, before any CARES Act related payment could be issued, were in place for the duration of the CARES Act program. No PUA or FPUC payment should be issued without these requirements being met. We will continue to enforce these controls. COMPLETION DATE/ CONTACT PERSON September 30, 2024 Ronald Marino - DLWD (609) 292-2810 Ronald.Marino@dol.nj.gov

DSHA will update its policy and procedure to require the documentation of the discontinuation of potential fraudulent assistance recovery efforts.

The program has corrected the calculation error in its income calculations form. Additionally, increased weekly training and case review have been implemented to detect and prevent such errors.

DSHA has implemented the process of requiring the reduction of applicable credits to be applied to all future payment batches and be utilized to fund assistance. This as a result, will eliminate the funds being held by the vendor and remove the need to report as a federal expenditure. The responsibility for implementing this corrective action lies with the following DSHA staff: HAF Program Manager, Director of Housing Finance, Financial Accounting & Reporting Section Manager, and the Director of Financial Management. They will oversee the necessary adjustments to the process and ensure that future payment batches adhere to the revised guidelines.

The Fiscal Coordinator, Supervisor of Transportation, Assistant Superintendent of Finance and Operations, and Grants Manager have all been briefed on the procurement standards. The Grants Manager will develop a grants management manual to share with all educators and administrators who are implementing grants, and will meet individually with the lead person on each grant to make sure all standards and procedures are clear. The Business Office will update the Grants Requisition Form to include a field to indicate whether procurement standards have been met. Both the Grants Manager and Assistant Superintendent of Finance and Operations are required to sign off on all Grant Requisition Forms.

Moving forward all Time & Efforts Records for federal grant funded positions will be on a single schedule (December and June) of each calendar year and tracked by each program department with support from administrative assistants. All forms will be collected electronically and remain on file in one central location in the Finance Department through Grants. This process was begun last year and worked well, but we learned that we need to include a mechanism for ensuring that staff complete Time and Effort forms upon their departure if they leave their role/the district prior to the December or June collection dates. We are working with HR to make sure that this is part of the exit process for any federally-funded staff.