Corrective Action Plans

FINDING 2024-003 Finding Subject: COVID-19 – Coronavirus State and Local Fiscal Recovery Funds – Reporting Federal Agency: Department of Treasury Contact Person Responsible for Corrective Action: Elizabeth Modesto Contact Phone Number and Email Address: 219-841-6326 Emodesto@portage-in.com Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: A new process of tracking grants for the City has been implemented; however, it should be noted that the previous Clerk-Treasurer prepared and submitted the report 2022. The report for 2024 was submitted in a timely fashion as required based on the fund activity in 2024. The report due and submitted in April 2025 was done similarly. Future reporting activities will not be necessary for this grant as it was completed in 2024. Anticipated Completion Date: New process will be completed prior to the preparation of the Annual Financial Report that will be submitted by March 1st of 2026 for all active federal awards.

Accounting has reviewed all projects and Ordinances related to ARPA and has updated reports and records to fully account for ARPA funding. From the Chief Administrative Officer (CAO) and the department responsible for a specific project that has multiple funding sources, confirmation was obtained on what amounts were obligated ARP funds. This strengthens the controls over the report submission process to ensure the reported amounts are accurate and reconciled properly. Person Responsible: Sheila Faour, CFO Anticipated Completion Date: Immediately

FINDING 2024-001 Finding Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds – Reporting Summary of Finding: The City submitted four P&E reports during the audit period; however, the controls in place were not effective to prevent, or detect and correct, errors. As a result, errors in reporting were identified. The current period and cumulative expenditures reported consisted of the amounts expended by the beneficiaries who were awarded funds from the City, rather than total amounts expended to the beneficiaries, resulting in current period expenditures and cumulative expenditures being incorrectly reported on all four reports as follows:  Quarterly Report: October 1, 2023 to December 31, 2023 Current period expenditures were overstated by $666,417. Cumulative expenditures were understated by $964,879.  Quarterly Report: January 1, 2024 to March 31, 2024 Current period expenditures were overstated by $860,312. Cumulative expenditures were understated by $104,567.  Quarterly Report: April 1, 2024 to June 30, 2024 Current period expenditures were overstated by $104,567. Contact Person Responsible for Corrective Action: Linda Moeller Contact Phone Number and Email Address: 812-948-5333 and lmoeller@cityofnewalbany.com Views of Responsible Officials and Explanation and Reasons for Disagreement:  We concur with the finding.  However, the issue and non-compliance deals with the interpretation of the federal rules regarding the appropriate amounts to report and when to report them by subrecipients of the monies.  The non-compliance is not related to policies or controls not being effective to prevent, detect or correct errors. In fact, the reporting system initially implemented by the City and put in the federal reports provided the actual expenditures for those periods by recipients of the grants.  However, the City does agree that after full examination and review of the federal rules the initial full amount of funds provided to the subrecipients should have been reported in full versus the actual expenditures during the periods. Description of Corrective Action Plan:  Current period and cumulative expenditures reported will consist of the amounts advanced to subrecipients. Anticipated Completion Date:  The City has already made this correction in its Quarterly Report July 1, 2024 to September 30, 2024.

Type of Finding: Significant deficiency in internal controls over the calculation of Modified Total Direct Costs puts CCS at risk of an overallocation indirect costs to federal programs. View of Responsible Officials: Management accepts this finding. Effective internal control over the calculation of Modified Total Direct Costs ensures that costs are allocated correctly to programs. Training of staff and increased review over allocations would likely have prevented this error. Corrective Action: CCS will be setting up a new form to calculate the Modified Indirect Cost Rate that each division will be required to use for all contract billings that are using the de minimis indirect cost method. The indirect costs charged to each contract will be reviewed semi-annually for accuracy and consistency.

2024-002 Finding Subject: COVID 19: Coronavirus State and Local Fiscal Recovery Funds - IFA Grant - White Ditch– Procurement and Suspension and Debarment Contact Person Responsible for Corrective Action: Mary Lynn Wall Contact Phone Number and Email Address: 219-873-1404 mlwall@emichigancity.com Views of Responsible Officials: We concur with the finding Procurement Federal regula􀆟ons allow for informal procurement methods when the value of the procurement for property or services does not exceed the simplified acquisi􀆟on threshold, which is customarily set at $250,000. However, Indiana Code 5-22-8 has a more restric􀆟ve threshold of $150,000 or less for when small purchase procedures may be used. This informal process allows for methods other than the formal bid process. Micro-purchases are typically for those purchases $10,000 or under, and small purchase procedures are for those purchases above the micro-purchase threshold, but below the simplified acquisi􀆟on threshold. Micro-purchases may be awarded without solici􀆟ng compe􀆟􀆟ve price rate quota􀆟ons. If small purchase procedures are used, then price or rate quota􀆟ons must be obtained from an adequate number of qualified sources. Description of Corrective Action Plan: All purchases need to be made in accordance with the Sanitary District of Michigan City Purchasing Policy. All contracts will be supported by a written and signed contract document per Section 9.0 of the Sanitary District of Michigan City Purchasing Policy. Suspension and Debarment 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)...." 2 CFR 200.320 states in part: "The non-Federal entity must have and use documented procurement procedures, consistent with the standards of this section and §§ 200.317, 200.318, and 200.319 for any of the following methods of procurement used for the acquisition of property or services required under a Federal award or sub-award. (a) Informal procurement methods. When the value of the procurement for property or services under a Federal award does not exceed the simplified acquisition threshold (SAT), as defined in § 200.1, or a lower threshold established by a non-Federal entity, formal procurement methods are not required. The non- Federal entity may use informal procurement methods to expedite the completion of its transactions and minimize the associated administrative burden and cost. The informal methods used for procurement of property or services at or below the SAT include: . . . (b) Formal Procurement Methods. When the value of the procurement for property or services under a Federal financial assistance award exceeds the SAT, or a lower threshold established by a non-Federal entity, formal procurement methods are required. Formal procurement methods require following documented procedures. Formal procurement methods also require public advertising unless a non-competitive procurement can be used in accordance with § 200.319 or paragraph (c) of this section. The following formal methods of procurement are used for procurement of property or services above the simplified acquisition threshold or a value below the simplified acquisition threshold the non-Federal entity determines to be appropriate: . . . (1) Sealed bids. A procurement method in which bids are publicly solicited and a firm fixed-price contract (lump sum or unit price) is awarded to the responsible bidder whose bid, conforming with all the material terms and conditions of the invitation for bids, is the lowest in price. The sealed bids method is the preferred method for procuring construction, if the conditions. . . . (2) Proposals. A procurement method in which either a fixed price or cost-reimbursement type contract is awarded. Proposals are generally used when conditions are not appropriate for the use of sealed bids. . . ." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you do business is not excluded or disqualified. You do this by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person." Description of Corrective Action Plan For all federally funded contracts exceeding $25,000, the Vendor will submit a statement indicating they were not suspended or debarred. For purchases not requiring a contract, the City Controller’s office will check the Excluded Parties List System prior to payment to the vendor. Anticipated Completion Date: 08/06/2025

FINDING 2024-001 Finding Subject: COVID-19- Coronavirus State and Local Fiscal Recovery Funds – Procurement and Suspension and Debarment Contact Person Responsible for Corrective Action: Mary Lynn Wall Contact Phone Number and Email Address: 219-873-1404 mlwall@emichigancity.com Views of Responsible Officials: We concur with the finding Procurement Federal regula􀆟ons allow for informal procurement methods when the value of the procurement for property or services does not exceed the simplified acquisi􀆟on threshold, which is customarily set at $250,000. However, Indiana Code 5-22-8 has a more restric􀆟ve threshold of $150,000 or less for when small purchase procedures may be used. This informal process allows for methods other than the formal bid process. Micro-purchases are typically for those purchases $10,000 or under, and small purchase procedures are for those purchases above the micro-purchase threshold, but below the simplified acquisi􀆟on threshold. Micro-purchases may be awarded without solici􀆟ng compe􀆟􀆟ve price rate quota􀆟ons. If small purchase procedures are used, then price or rate quota􀆟ons must be obtained from an adequate number of qualified sources Description of Corrective Action Plan: All purchases need to be made in accordance with the City of Michigan City Purchasing Policy. Purchases made under the Special Purchase provision (I.C.5-22-10-1) will abide by section 7.4 of the Michigan City Purchasing Policy. This section describes the required record keeping. Suspension and Debarment Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)...." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you do business is not excluded or disqualified. You do this by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person." 2 CFR 200.320 states in part: (a) "The non-Federal entity must have and use documented procurement procedures, consistent with the standards of this section and §§ 200.317, 200.318, and 200.319 for any of the following methods of procurement used for the acquisition of property or services required under a Federal award or sub-award. Informal procurement methods. When the value of the procurement for property or services under a Federal award does not exceed the simplified acquisition threshold (SAT), as defined in § 200.1, or a lower threshold established by a non-Federal entity, formal procurement methods are not required. The non- Federal entity may use informal procurement methods to expedite the completion of its transactions and minimize the associated administrative burden and cost. The informal methods used for procurement of property or services at or below the SAT include: . . . (2) Small purchases– (i) Small purchase procedures. The acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity. . Description of Corrective Action Plan: For all federally funded contracts exceeding $25,000, the Vendor will submit a statement indicating they were not suspended or debarred. For purchases not requiring a contract, the City Controller’s office will check the Excluded Parties List System prior to payment to the vendor. Anticipated Completion Date: 08/06/2025 INDIANA STATE

FINDING 2024-005 Contact Person Responsible for Corrective Action: Amy L. Glackman Contact Phone Number: 317-392-6310 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: Control procedures will be put into place effective immediately. The Auditor will have the Deputy Auditor start signing off on all reports to verify the dates are correct for the reporting period. Anticipated Completion Date: August 30, 2025

FINDING 2024-003 Finding Subject: COVID-19 Coronavirus State and Local Fiscal Recovery Funds- Reporting Contact Person Responsible for Corrective Action: Heather Huff Contact Phone Number and Email Address: 812-265-8907 heather.huff@jeffersoncounty.in.gov Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The Auditor’s Office will collect dual signatures on all submissions for reporting requirements. The Auditor’s Office will also have additional employees verify submissions to ledgers for accuracy. Anticipated Completion Date: Completion is anticipated for all reports due after 12-31-2025.

The Board of County Commissioners, with the cooperation and participation of all elected officials, reviews, develops and implements policies and procedures to create a strong internal control environment. The Board of County Commissioners will work with all elected officials, the third-party administrator, and federal, state and local partners to develop policies, procedures, and internal controls designed to accurately track grants, including the application process, verification, oversight, and reporting of grant requirements. To assist in this process, the Board of County Commissioners engaged a third-party administrator to oversee the grant process, including application, eligibility, review, requirements, contracting, recipient tracking and oversight, and documentation and reporting. The Board of County Commissioners will work with the third-party administrator to ensure proper grant administration.

FINDING 2024-004 Finding Subject: COVID-19 Coronavirus State and Local Fiscal Recovery Funds – Reporting Contact Person Responsible for Corrective Action: Christy Smiley Contact Phone Number and Email Address: 812-663-2570, auditor@decaturcounty.in.gov Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: INDIANA STATE BOARD OF ACCOUNTS 27 At least 2 people will look over the report and check all receipts and expenditures when the next P&E report is submitted to prevent and detect any errors. Prior P&E report had already been submitted before the prior audit was complete and we were made aware of the issue and then the Auditor changed in 2025. Control will not be in place until the 2026 P&E report is submitted. Anticipated Completion Date: Submission of next ARPA report, April 2026.

Views of Responsible Officials and Planned Corrective Action: Management agrees with this finding and will adopt a formal Federal procurement policy which includes all elements identified in 2CFR Sections 200.303 and 200.318 through 200.626.

Views of Responsible Officials and Planned Corrective Action: Management agrees with this finding and will adopt a formal Federal procurement policy which includes all elements identified in 2CFR Sections 200.303 and 200.318 through 200.626.

FINDING 2024-002 Finding Subject: Coronavirus State and Local Fiscal Recovery Funds - Procurement and Suspension and Debarment Contact Person Responsible for Corrective Action: Darrin Boas Contact Phone Number and Email Address: 812-522-4020; dboas@seymourin.org Views of Responsible Officials: We concur with the findings Description of Corrective Action Plan: Management developed, adopted and implemented a procurement policy for federal purchases that aligns with the requirement of the 2 CFR 200 Uniform Guidance. This process includes steps within the interview and application process to ensure contractors and subrecipients are eligible (not suspended, debarred, or otherwise excluded) to enter into an agreement, contract, or subaward with the City. The contract in question was agreed to during last year’s audit and part of an overall project/grant overseen by Schneck Hospital entered into in 2021. Going forward, the Clerk Treasurer will review the agreements with the vendors who are being paid from federal grant monies to ensure that the procurement policy is being followed and proper documentation is being obtained based on the procurement method. Anticipated Completion Date: Completed. The City adopted Ordinance 35 on November 25, 2024. This was the effective date of correction.

Recommendation We recommend the Organization update their method of allocating expenditures to federal awards based on the incurred date, rather than paid date.

The City has taken several steps to strengthen its FFATA compliance. In response to this audit finding, the City has implemented the following corrective actions: 1. Standardized Data Collection: An updated subrecipient data collection form has been developed to ensure consistent and complete capture of all required FFATA elements prior to contract execution. 2. Formal Tracking System: The City created a FFATA Tracking Spreadsheet to systematically document and monitor all required reporting elements, including the correct obligation date, which is now tied to the legal execution date of the subaward. 3. Policy and Procedure Development: FFATA reporting policy and procedures have been developed to codify roles, timelines, and compliance responsibilities. This includes guidance on identifying the proper obligation date, data verification steps, and the timeline for submission to SAM.gov (within 30 days of obligation). 4. Staff Training and Oversight: Relevant staff will be trained on FFATA compliance requirements, and the Grants Management Division will conduct quarterly spot checks to ensure accuracy and timeliness of reporting.

The City has taken several steps to strengthen its FFATA compliance. In response to this audit finding, the City has implemented the following corrective actions: 1. Standardized Data Collection: An updated subrecipient data collection form has been developed to ensureconsistent and complete capture of all required FFATA elements prior to contract execution. 2. Formal Tracking System: The City created a FFATA Tracking Spreadsheet to systematically document and monitor all required reporting elements, including the correct obligation date, which is now tied to the legal execution date of the subaward. 3. Policy and Procedure Development: FFATA reporting policy and procedures have been developed to codify roles, timelines, and compliance responsibilities. This includes guidance on identifying the proper obligation date, data verification steps, and the timeline for submission to SAM.gov (within 30 days of obligation). 4. Staff Training and Oversight: Relevant staff will be trained on FFATA compliance requirements, and the Grants Management Division will conduct quarterly spot checks to ensure accuracy and timeliness of reporting.

Following the Auditor's recommendations and as corrective action, the staff or department in charge locate and document all required reports that were filed according to the requirements of the grant agreement, including reconciliation thereof with the official Municipality’s accounting subsidiaries. In addition, the Municipality will design, document, establish and provide the necessary and required training, including guidelines and procedures, to all personnel who work directly or indirectly with the management of these federal funds.

The Municipality will designate the appropriate personnel to systematically identify, compile, and securely retain all required reports as stipulated in the grant agreement, ensuring reconciliation with the official accounting records and subsidiary ledgers. Furthermore, the Municipality will develop and implement a comprehensive training program, accompanied by detailed written guidelines and procedures, to equip all staff involved in managing federal funds with the necessary knowledge and tools to maintain compliance and enhance accountability.

Finding: 2024-038 - DMVA management did not issue a management decision for a finding relating to one subrecipient’s single audit. Questioned Costs: None Assistance Listing Number: 97.036 Assistance Listing Title: Disaster Grants — Public Assistance (Presidentially Declared Disasters) Views of Responsible Officials (state whether your agency agrees or disagrees with the finding; if you disagree, briefly explain why): DMVA concurs with the finding. Corrective Action (corrective action planned): DMVA acknowledges the importance of issuing timely and adequate management decisions to ensure subrecipients take corrective action. The Finance Officer will review internal procedures to identify areas of improvement that may eliminate a single-point of failure in this requirement. Completion Date (list anticipated completion date): 06/30/2025 Agency Contact (name of person responsible for corrective action): Pamela Wiederspohn

2024-001 Research and Development Cluster – Education Innovation and Research (formerly Investing in Innovation (i3) Fund – Validation Grants) Assistance Listing No. 84.411A Condition: For both subawards selected for testing, the identification of the contact information for the awarding agency was incorrect. The contact information was Education Analytics, Inc., the Organization’s grantor, but should have been Future Forward, Inc. Further, one of the two subawards selected for testing had information missing from the subaward including all requirements for the award to be used in accordance with Federal statutes, regulations and terms and conditions of the Federal award. We consider this condition to be an instance of noncompliance relating to the Subrecipient Monitoring compliance requirement. Statistical sampling was not used in making sample selections. Corrective Action Plan: Future Forward will re-issue contracts/MOUs for its two subawards with the correct awarding agency listed (Future Forward instead of Education Analytics). In addition, Future Forward will include requirements for the award to be used in accordance with Federal statutes, regulations and terms and conditions of the Federal award in the revised contracts/MOUs. Responsible Person for Corrective Action Plan: Kate Bauer-Jones, Executive Director Implementation Date for Corrective Action Plan: May 15, 2025

Finding 2024-004 Significant Deficiency in Internal Control over Compliance, Other Matters Description of Finding The Town of Lincoln’s procurement standards do not include the essential elements as outlined in 2 CFR sections 200.303, and 200.318 through 200.326 within Uniform Guidance. Statement of Concurrence or Nonconcurrence Management concurs with the finding. Corrective Action Management is working with our current auditors to update the Town’s procurement policies to be in compliance with Uniform Guidance. Name of Contact Person John Cimino, Finance Director Projected Completion Date 6/30/2026

Finding 2024-003: Unsubstantiated Expense The single audit report included the following recommendation: We recommend that management strengthen the process to identify and review funding sources of underlying expenditures, that support the amounts of the reclassification journal entries. This could include reviewing approved budgets for the federal award in scope at a necessary level of detail to determine appropriateness of allocations in a timely manner. Management Response/Status of Action Plans: Amtrak believes education and reinforcing the existing upfront controls to ensure the correct initial coding of the expenditures is correct is the best way to address this issue. When this issue was identified during the audit, the company coordinated a meeting with the department where these costs originated to reinforce the need to properly code the expenditures in the purchase order process. Leadership in that department acknowledged the miscoding and committed to proper coding going forward. The company understands that the issue of training on this control to properly code purchase orders may exist in other departments and will develop communication to reinforce education in the proper processes and controls in this area. The contact for this item is Carol Hanna, VP Controller. Amtrak anticipates that changes described above will remediate this finding in the fiscal year ending September 30, 2025

As a corrective measure, BGCPR will take the following actions and will anticipate completing on June 30, 2025: a. Implement and maintain an automated accounting and financial records system to enable real-time oversight of the asset capitalization policy. b. Establish a robust internal control framework including pre-approvals for equipment purchases and cross-validations of financial data. c. Periodic internal monitoring’s to ensure compliance and documentation.d. Update BGCPR’s fiscal management guidance to include a formal provision requiring the capitalization policy to be reviewed every three (3) years in compliance with the ensure compliance with federal regulation 2 CFR §200 regarding asset capitalization criteria. e. Conduct a training program for accounting and financial personnel.

Condition: Obligations and expenditures were overstated by $93,955 on the March 31, 2024 Project and Expenditure report. Corrective Action Planned: Town Administrator will work with CSS Capital Strategic Solutions LLC to potentially amend the filing with the Treasury. Anticipated Completion Date: End of 2025 Contact: Town Administrator Nelson Mui, nmui@townsendma.gov, 978-597-1700 x1703

Finding: The Office of Superintendent of Public Instruction improperly charged $5,139 to the Special Education program. Questioned Costs: Assistance Listing # 84.027 84.027 COVID-19 84.173 84.173 COVID-19 Amount $5,139 Status: Corrective action complete Corrective Action: The Office of Superintendent of Public Instruction concurs with this finding. The Office has strengthened internal controls to address accounting adjustments made during liquidation periods to ensure that expenditures occurring outside of a grant’s period of performance are not shifted to the grant. Procedures are updated to: • Monitor expenditures through reconciliation of monthly reports to ensure the spending level stays within the allowable threshold and grant maximum. • Require all journal vouchers correcting expenditures during the grant liquidation period be verified by budget staff to ensure they are charged to the appropriate grant period of performance. • Complete expenditure corrections within the grant liquidation period. • Liquidate obligations on the last business day of January (or 120 days after the budget period ends). The Office will communicate the corrective action plan with internal stakeholders to ensure compliance with updated procedures. The Office will consult with the federal grantor to discuss whether the questioned costs identified in the audit should be repaid. Completion Date: November 2024 Agency Contact: Tania May Assistant Superintendent, Special Education PO Box 47200 Olympia, WA 98504-7200 (360) 725-6075 Tania.may@k12.wa.us