Corrective Action Plans

Finding 537415 (2024-004)

Material Weakness 2024

IN

Procurement, Suspension & Debarment School Nutrition Programs § 200.303

FINDING 2024-004 Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program ALN Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and ...

FINDING 2024-004 Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program ALN Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY23, FY24 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Non-Compliance Contact Person Responsible for Corrective Action: Chad Yencer - Superintendent Contact Phone Number: 765-348-7550 Views of Responsible Official: We concur with this finding Description of Corrective Action Plan: BCS has established the following internal controls to ensure compliance: 1. Internal Control: When a purchase is made at $10,000 or more using Federal Funds, the superintendent will require that any vendors selected are in compliance with the Procurement and Suspension and Debarment compliance requirement by completing one of the following quality checks with each vendor prior to purchase: a. Checking the federal System for Award Management (SAM) database at https://sam.gov/content/exclusions and maintain a screenshot of the search results. b. Collect a certification from the vendor directly c. Add a clause or condition to the covered transaction with the vendor In this audit, the Deputy Treasurer conducted the check but misspelled the vendors name while checking so no actual check was completed. Anticipated Completion Date: This corrective action will be implemented and completed immediately with any purchase made that meets the above threshold.

View Audit 348618

Finding 537414 (2024-003)

Material Weakness 2024

Blackford County Schools

IN

Questioned Costs Allowable Costs / Cost Principles School Nutrition Programs § 200.303 § 200.403

Finding 2024‐003 Subject: Child Nutrition Cluster – Allowable Costs/ Cost Principles Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Compl...

Finding 2024‐003 Subject: Child Nutrition Cluster – Allowable Costs/ Cost Principles Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Compliance Requirement: Allowable Costs/ Cost Principles Audit Findings: Material Weakness, Other Matters Contact Person Responsible for Corrective Action: Julie Dodd, Treasurer Contact Phone Number: 765-348-7550 Views of Responsible Official: We concur with the finding of the auditor Description of Corrective Action Plan: This was a singular occurrence in which indirect costs were applied in the wrong year. Moving forward, no indirect costs will be charged or paid outside of the correct time period for the fiscal year. Anticipated Completion Date: Completed

View Audit 348618 Questioned Costs: $1

Finding 537413 (2024-028)

Significant Deficiency 2024

State of Vermont

VT

Subrecipient Monitoring Reporting Significant Deficiency § 200.303

Reference Number: 2024-028 Prior Year Finding: 2023-034 Federal Agency: U.S. Department of Homeland Security State Agency: Department of Public Safety Federal Program: Disaster Grants - Public Assistance (Presidentially Declared Disasters) Assistance Listing Number: 97.036 Award Number and Year: FEM...

Reference Number: 2024-028 Prior Year Finding: 2023-034 Federal Agency: U.S. Department of Homeland Security State Agency: Department of Public Safety Federal Program: Disaster Grants - Public Assistance (Presidentially Declared Disasters) Assistance Listing Number: 97.036 Award Number and Year: FEMA-4474-DR-VT (2020), FEMA-4532-DR-VT (2020), FEMA-4621-DR-VT (2021), FEMA-4695-DR-VT (2023), FEMA-4720-DR-VT (2023) Compliance Requirement: Reporting – Federal Funding Accountability and Transparency Act (FFATA) Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend the Department complete implementation of its corrective action plan from the prior year. The Department should continue to improve its procedures and internal controls to ensure that all required subawards and subaward modifications are reported accurately and timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: Public Safety will continue implementation of its corrective action plan from the prior year. A new procedure will be developed for a periodic review of FFATA entries to add a control step ensuring that all FFATA entries are timely and accurate. A training will also be delivered to Public Assistance staff to ensure that the FFATA entry process is understood in both FSRS and SAM.gov. These corrective actions will be completed by April 4th, 2025 Scheduled Completion Date of Corrective Action Plan: April 4, 2025 Contacts for Corrective Action Plan: Richard Hallenbeck, Director of Administration/Finance richard.hallenbeck@vermont.gov

View Audit 348596

Finding 537402 (2024-025)

Significant Deficiency 2024

State of Vermont

VT

Special Tests & Provisions Significant Deficiency Matching / Level of Effort / Earmarking § 200.303

Reference Number: 2024-025 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services (Agency) Federal Program: Medicaid Cluster Assistance Listing Number: 93.775, 93.777, 93.778 Award Number and Year: 2305VT5MAP (10/1/2022 – 9/30/2023)...

Reference Number: 2024-025 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services (Agency) Federal Program: Medicaid Cluster Assistance Listing Number: 93.775, 93.777, 93.778 Award Number and Year: 2305VT5MAP (10/1/2022 – 9/30/2023) 2405VT5MAP (10/1/2023 – 9/30/2024) Compliance Requirement: Special Tests and Provisions – Utilization Control Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend that the Agency review and enhance procedures and controls for Medicaid utilization control to ensure that cases are closed timely and that documentation of the results of reviews are maintained and communicated. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The Special investigations Unit (SIU) only refers two types of cases to the Medicaid Fraud Residential Abuse Unit (MFRAU), these cases are: Personal Care Attendant (PCA) and provider fraud and abuse. Prior to 2021 most of those cases were kept in paper format. Since then, the SIU has fully transitioned to electronic files only. All PCA cases referred to MFRAU are assigned to the Duty Auditor (DA) of the Special Investigations Unit (SIU). The DA must send the case referral via a form that MFRAU must return with notification of acceptance or declination to investigate the allegation. If the case is accepted, then it remains under “open referred to MFRAU” status in our database and updates must be provided and documented by the DA during our MFRAU/SIU quarterly meetings until SIU receives a closure memo from MFRAU that documents the completion of their review. Additionally, all provider cases remain open with the auditor who investigated and referred the matter until a closing memo is received by the SIU. All documented follow ups are recorded in the case log. Scheduled Completion Date of Corrective Action Plan: This process has been implemented since 2021 for cases generated from that year forward. SIU Procedure Manual has been updated accordingly as of December 31, 2024. Contacts for Corrective Action Plan: Nadeth Fitzgerald, Director – SIU nadeth.fitzgerald@vermont.gov Peter Moino, AHS Director of Internal Audit peter.moino@vermont.gov

View Audit 348596

Finding 537401 (2024-024)

Significant Deficiency 2024

State of Vermont

VT

Eligibility Matching / Level of Effort / Earmarking Special Tests & Provisions § 200.303

Reference Number: 2024-024 Prior Year Finding: 2023-031; 2022-037; 2021-025; 2020-014; 2019-010 Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: Medicaid Cluster Assistance Listing Number: 93.775, 93.777, 93.778 Award Number and Yea...

Reference Number: 2024-024 Prior Year Finding: 2023-031; 2022-037; 2021-025; 2020-014; 2019-010 Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: Medicaid Cluster Assistance Listing Number: 93.775, 93.777, 93.778 Award Number and Year: 2305VT5MAP (10/1/2022 – 9/30/2023) 2405VT5MAP (10/1/2023 – 9/30/2025) Compliance Requirement: Special Tests and Provisions - Provider Health and Safety Standards Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend the Agency fully implement its CAP to ensure that documentation is maintained in accordance with program requirements and that all providers are compliant with required health and safety standards. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: All Letters of Good Standing as well as a Standard Operating Procedure to ensure continuation were implemented in April of 2022. Prior to April the process was manual and via telephone or email with the Tax Department. All Providers who had their tax standing validated prior to April 2022 via phone or email were not solicited to get a written notification from the Tax Commissioner. As of April 2022 all tax standing reviews are validated with a letter from the Vermont Tax department and documented in the Provider Management Module. Verification with the VT Tax Department of a provider’s tax standing has always occurred; However, the good standing verification was documented in the PMM system and the confirmation of the verification from the VT Tax Department was not consistently maintained in the PMM. Although the Agency has implemented its corrective action plan from a prior year audit, cases will still be identified under this CAP until the provider is due for their 5-year revalidation and successfully revalidates with VT Medicaid. Scheduled Completion Date of Corrective Action Plan: Completed Contacts for Corrective Action Plan: Deidra Jarvis, Member and Provider Services Supervisor deidra.Jarvis@vermont.gov Peter Moino, AHS Director of Internal Audit peter.moino@vermont.gov

View Audit 348596

Finding 537400 (2024-023)

Significant Deficiency 2024

State of Vermont

VT

Subrecipient Monitoring Reporting Significant Deficiency § 200.303

Reference Number: 2024-023 Prior Year Finding: 2023-030; 2022-038; 2021-026 Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: Medicaid Cluster Assistance Listing Number: 93.775, 93.777, 93.778 Award Number and Year: 2305VT5MAP (10/1/...

Reference Number: 2024-023 Prior Year Finding: 2023-030; 2022-038; 2021-026 Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: Medicaid Cluster Assistance Listing Number: 93.775, 93.777, 93.778 Award Number and Year: 2305VT5MAP (10/1/2022 – 9/30/2023) 2405VT5MAP (10/1/2023 – 9/30/2024) Compliance Requirement: Reporting – Federal Funding Accountability and Transparency Act (FFATA) Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend that the Agency complete implementation of its prior year CAP to ensure that all required subawards and subaward modifications are reported timely to FSRS in accordance with FFATA requirements. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: Agency of Human Services Internal Audit Group (AHS-IAG) is a designated centralized reporter of subawards for a Medicaid cluster (ALN 93.775, 93.777, 93.778) that is shared between all AHS departments. To address omissions and timeliness of subawards and subaward modifications reporting to FSRS, IAG conducted additional training tailored to each AHS Department to examine the results of FFATA testing conducted internally and reemphasized the FFATA compliance regulations. This ensured the Internal Audit Group (IAG) is provided with complete, accurate and timely subaward information for reporting in FSRS going forward. The context of the 2024 finding indicates that the departments understood the training materials and complied with the requirements to report. On at least an annual basis, IAG conducts a review of current federal rules and regulations pertaining to FFATA reporting for FSRS to assure the Agency’s procedures are up to-date. Coincidentally, IAG will also select a random sample of subawards and subawards modifications that meet the required threshold for FFATA reporting to ensure they are reported in FSRS system on a complete, accurate and timely basis. Scheduled Completion Date of Corrective Action Plan: March 31, 2025: Annual review of FFATA rules and regulations including subawards review. Contacts for Corrective Action Plan: Peter Moino, AHS Director of Internal Audit peter.moino@vermont.gov

View Audit 348596

Finding 537399 (2024-022)

Significant Deficiency 2024

State of Vermont

VT

Eligibility Significant Deficiency Matching / Level of Effort / Earmarking § 200.303

Reference Number: 2024-022 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services (Agency) Federal Program: Medicaid Cluster Assistance Listing Number: 93.775, 93.777, 93.778 Award Number and Year: 2305VT5MAP (10/1/2022 – 9/30/2023)...

Reference Number: 2024-022 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services (Agency) Federal Program: Medicaid Cluster Assistance Listing Number: 93.775, 93.777, 93.778 Award Number and Year: 2305VT5MAP (10/1/2022 – 9/30/2023) Compliance Requirement: Eligibility Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend that the Agency review and enhance procedures and controls for Medicaid eligibility renewals to ensure that benefits for eligible participants are not discontinued. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The error was caused by a caseworker not following the steps within the job aid when processing eligibility for a late renewal form. Coverage closed on 9/30/24 for non-review. The renewal form was received on 10/17/2023 yet, coverage was reinstated for 11/1/2024 instead of 10/1/24. The gap in coverage was corrected on 9/16/2024 and coverage was backdated to 10/1/24. The eligibility unit notified the worker’s supervisor who reviewed the case error with the caseworker. In addition, eligibility staff receive refresher training yearly to review our business processes. The Eligibility Unit will continue to monitor cases through our internal QA process unit and through our off-year reviews conducted by the QC unit. Scheduled Completion Date of Corrective Action Plan: Coverage was corrected on September 16, 2024. Contacts for Corrective Action Plan: Nicole McAllister, Healthcare Assistant Administrator II nicole.mcallister@vermont.gov Sarah York, Healthcare Assistant Administrator I sarah.york@vermont.gov Peter Moino, AHS Director of Internal Audit peter.moino@vermont.gov

View Audit 348596

Finding 537387 (2024-021)

Significant Deficiency 2024

State of Vermont

VT

Eligibility Student Financial Aid Subrecipient Monitoring § 200.303

Reference Number: 2024-021 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: CCDF Cluster Assistance Listing Number: 93.575, 93.596 Award Number and Year: 2301VTCCDD (10/1/2022 – 9/30/2025) 2401VTCCDD (10/1/202...

Reference Number: 2024-021 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: CCDF Cluster Assistance Listing Number: 93.575, 93.596 Award Number and Year: 2301VTCCDD (10/1/2022 – 9/30/2025) 2401VTCCDD (10/1/2023 – 9/30/2026) Compliance Requirement: Eligibility Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend that the Agency review and enhance procedures and controls to ensure that it verifies U.S. citizenship for all participants and confirm that only eligible participants receive benefits under the program. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: This finding has been corrected as of January 2024 dating back to October 2023. The State is no longer pooling funding sources which means that we can identify cases by their true funding source. This means that only true CCDF cases will be audited going forward and family service cases (protective service) no longer follow CCDF rules including citizenship and identity. Scheduled Completion Date of Corrective Action Plan: December 31, 2024 Contacts for Corrective Action Plan: Karolyn Long, Operations Director karolyn.long@vermont.gov Peter Moino, AHS Director of Internal Audit peter.moino@vermont.gov

View Audit 348596

Finding 537386 (2024-020)

Material Weakness 2024

State of Vermont

VT

Special Tests & Provisions Subrecipient Monitoring Material Weakness § 200.303

Reference Number: 2024-020 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: CCDF Cluster Assistance Listing Number: 93.575, 93.596 Award Number and Year: 2301VTCCDD (10/1/2022 – 9/30/2025) 2401VTCCDD (10/1/202...

Reference Number: 2024-020 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: CCDF Cluster Assistance Listing Number: 93.575, 93.596 Award Number and Year: 2301VTCCDD (10/1/2022 – 9/30/2025) 2401VTCCDD (10/1/2023 – 9/30/2026) Compliance Requirement: Special Tests and Provisions – Health and Safety Requirements Type of Finding: Material Weakness in Internal Control Over Compliance, Material Noncompliance Recommendation: We recommend that the Agency review and enhance training monitoring procedures and controls to ensure that all child care providers complete required health and safety training. We further recommend that the Agency update its training content to ensure that it includes all required elements. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: Department for Children and Families-Child Development Division (DCF-CDD) licensing unit is in the process of rule revisions which will include all the required health and safety topics that must be covered within the first three months of employment. DCF-CDD licensing unit will be updating our monitoring checklists to ensure we are regulating to the federal standard. DCF-CDD licensing unit will conduct staff training that review the results of the SFY 2024 Single Audit and establish clear procedures for licensing staff to follow when monitoring licensed providers and their staff for ongoing professional development requirements. Scheduled Completion Date of Corrective Action Plan: DCF-CDD is currently in the rule revision process and have a goal to shepherd the rules through promulgation by December 31, 2025. DCF-CDD will update our monitoring checklists to align with the rule revision which will include a complete pre-service orientation training list that aligns with the federal standard. This will be completed by December 31, 2025. DCF-CDD will review the results of the SFY 2024 Single Audit with the licensing team on January 21, 2025. Licensing supervisors will begin reviewing annual site visit reports for the licensors they supervise to ensure CDD is monitoring for the required ongoing professional development trainings required beginning immediately. Contacts for Corrective Action Plan: Beth Maurer, Director of Child Care Licensing elizabeth.maurer@vermont.gov Peter Moino, AHS Director of Internal Audit peter.moino@vermont.gov

View Audit 348596

Finding 537379 (2024-019)

Significant Deficiency 2024

State of Vermont

VT

Matching / Level of Effort / Earmarking Special Tests & Provisions Reporting § 200.303

Reference Number: 2024-019 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: Temporary Assistance for Needy Families Assistance Listing Number: 93.558 Award Number and Year: 2301VTTANF (10/1/2022 – 9/30/2023) 2...

Reference Number: 2024-019 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: Temporary Assistance for Needy Families Assistance Listing Number: 93.558 Award Number and Year: 2301VTTANF (10/1/2022 – 9/30/2023) 2401VTTANF (10/1/2023 – 9/30/2024) Compliance Requirement: Reporting – ACF-199 Special Tests and Provisions – Penalty for Failure to Comply with Work Verification Plan Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend that the Agency review and enhance procedures and controls to ensure that it maintains adequate documentation, verification, and internal control procedures to ensure the accuracy of work participation rates reported in the ACF-199 reports. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: For the data system programming error finding, the Department removed the hard coding in the programming that limited participant hours to 40. This was completed as soon as the error was identified and our regional team approved the proposed corrective action. For the individual instances where the reported work participation rates reported on the ACF-199 report did not agree with supporting documentation and that supporting documentation contained errors or was incomplete, the Department will do the following: • Highlight each of the individual types of errors in our weekly newsletter that goes out to all staff and describe the correct action that should have been taken in documentation. • Have members of Reach Up Central Office (RUCO) team attend the Senior Benefits Program Specialist Sr. BPS) meeting to review the individual types of errors and describe the correct action that should have been taken. Sr. BPS are responsible for the direct training of district Benefits Program Specialists (BPS) that process eligibility. Following their meeting they will return to their district offices and provide an overview to the district eligibility staff. • RUCO will hold a virtual office hours session for eligibility staff to attend focused on the individual types of errors and the correct action that should have been taken. Scheduled Completion Date of Corrective Action Plan: • Data system programming error was corrected in October 2024. • Newsletter highlights will be shared with staff by January 31, 2025. • Sr BPS meeting will be attended by February 28, 2025. • Virtual office hours will be held by March 31, 2025. Contacts for Corrective Action Plan: Chris Dorer, Reach Up Assistant Administrator christine.dorer@vermont.gov Peter Moino, AHS Director of Internal Audit peter.moino@vermont.gov

View Audit 348596

Finding 537378 (2024-018)

Material Weakness 2024

State of Vermont

VT

Subrecipient Monitoring Material Weakness Reporting § 200.303

Reference Number: 2024-018 Prior Year Finding: 2023-024 Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: COVID-19 - Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Hea...

Reference Number: 2024-018 Prior Year Finding: 2023-024 Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: COVID-19 - Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises Assistance Listing Number: 93.391 Award Number and Year: NH75OT000034 (6/1/2021 – 5/31/2026) Compliance Requirement: Reporting – Federal Funding Accountability and Transparency Act (FFATA) Type of Finding: Material Weakness in Internal Control Over Compliance, Material Noncompliance Recommendation: We recommend the Agency complete implementation of its prior year CAP to ensure that all required subawards and subaward modifications are reported timely to FSRS in accordance with FFATA requirements and that all previously issued subawards are reported. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The Financial Administrator will ensure that subrecipient grants containing federal funding that meet the FFATA reporting threshold are marked as “required for entry into the FSRS system” upon grant execution. The Financial Administrator and Manager will then confirm that all executed agreements that meet the FFATA reporting requirement have been entered and submitted into the FSRS system by the last business day of each month. Please note that the scheduled completion date is 2/1/23 as the same FFATA reporting finding was identified for a different program during the SFY22 Single Audit, and the corrective action plan was applied across the Department as a whole. The FFATA issues identified in the SFY24 Single Audit pre-dated the implementation of the Health Department’s original corrective action plan. Scheduled Completion Date of Corrective Action Plan: February 1, 2023 Contacts for Corrective Action Plan: Lillian Smith, Financial Administrator lillian.smith@vermont.gov Jessica Brown, Financial Manager jessica.brown@vermont.gov Megan Hoke, Financial Director megan.hoke@vermont.gov Peter Moino, Director of Internal Audit peter.moino@vermont.gov

View Audit 348596

Finding 537377 (2024-017)

Material Weakness 2024

State of Vermont

VT

Material Weakness Reporting Matching / Level of Effort / Earmarking § 200.303

Reference Number: 2024-017 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: COVID-19 - Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcar...

Reference Number: 2024-017 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: COVID-19 - Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises Assistance Listing Number: 93.391 Award Number and Year: NH75OT000034 (6/1/2021 – 5/31/2026) Compliance Requirement: Reporting – Performance Reporting Type of Finding: Material Weakness in Internal Control Over Compliance, Material Noncompliance Recommendation: We recommend the Agency review and enhance internal controls and procedures to ensure that performance reports are accurate, agree with supporting documentation, and that supporting documentation is maintained and available for audit. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The Office of Health Equity Integration’s Director and Equity Manager will ensure that all supporting documentation are cross checked with formal submissions in CDC’s REDCap reporting system to verify consistency and accuracy of performance reports. Additionally, the Equity Manager and Program Administrator will confirm all supporting documentation are properly stored in the program’s SharePoint site by the end of each quarterly reporting period. Scheduled Completion Date of Corrective Action Plan: January 31, 2025 Contacts for Corrective Action Plan: Katherine Richardson, Program Administrator katherine.richardson@vermont.gov Ariel Carter, Equity Manager ariel.carter@vermont.gov Song Nguyen, Equity Director song.nguyen@vermont.gov Megan Hoke, Financial Director III megan.hoke@vermont.gov Peter Moino, AHS Director of Internal Audit peter.moino@vermont.gov

View Audit 348596

Finding 537373 (2024-016)

Significant Deficiency 2024

State of Vermont

VT

Subrecipient Monitoring Reporting Significant Deficiency § 200.303

Reference Number: 2024-016 Prior Year Finding: 2023-018; 2022-029; 2021-018 Federal Agency: U.S. Department of Education State Agency: Agency of Education Federal Program: COVID-19 – Governor’s Emergency Education Relief Fund COVID-19 – Elementary and Secondary School Emergency Relief Fund (ESSER) C...

Reference Number: 2024-016 Prior Year Finding: 2023-018; 2022-029; 2021-018 Federal Agency: U.S. Department of Education State Agency: Agency of Education Federal Program: COVID-19 – Governor’s Emergency Education Relief Fund COVID-19 – Elementary and Secondary School Emergency Relief Fund (ESSER) COVID-19 - Coronavirus Response and Relief Supplemental Appropriations Act, 2021 – Emergency Assistance to Non-Public Schools (CRRSA EANS) COVID-19 – American Rescue Plan – Elementary and Secondary School Emergency Relief (ARP ESSER) COVID-19 - American Rescue Plan – Elementary and Secondary School Emergency Relief –Homeless Children and Youth Assistance Listing Number: 84.425C, 84.425D, 84.425R, 84.425U, 84.425W Award Number and Year: S425C210009 (1/8/2021 – 9/30/2022) S425D210011 (1/5/2021 – 9/30/2022) S425R210033 (2/23/2021 – 9/30/2022) S425U210011 (3/24/2021 – 9/30/2023) S425W210047 (4/23/2021 – 9/30/2023) Compliance Requirement: Reporting – Federal Funding Accountability and Transparency Act (FFATA) Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend the Agency complete implementation of its corrective action plan from the prior audit. It should review and enhance internal controls and procedures to ensure that all required subawards and subaward amendments are reported timely and accurately to FSRS no later than the end of the month following the month of issuance. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The Agency implemented a reconciliation process in March of 2023 that allows us to ensure our grant ledgers agree with what is entered into FFATA. The Agency will increase the number of reconciliations per year to quarterly. The Agency continues to work toward our preferred solution to address the accuracy and timeliness of our entries into the FFATA system by creating an upload file of the data from our grants management system. Scheduled Completion Date of Corrective Action Plan: July 1, 2025 Position Responsible for Implementation of Corrective Action Sean Cousino, Interim CFO sean.couisno@vermont.gov

View Audit 348596

Finding 537372 (2024-015)

Significant Deficiency 2024

State of Vermont

VT

Cash Management Internal Control / Segregation of Duties § 200.303

Reference Number: 2024-015 Prior Year Finding: No Federal Agency: U.S. Department of Education State Agency: Agency of Education Federal Program: Student Support and Academic Enrichment Grants Assistance Listing Number: 84.424 Award Number and Year: S424A220047 (7/1/2022 – 9/30/2024) Compliance Requ...

Reference Number: 2024-015 Prior Year Finding: No Federal Agency: U.S. Department of Education State Agency: Agency of Education Federal Program: Student Support and Academic Enrichment Grants Assistance Listing Number: 84.424 Award Number and Year: S424A220047 (7/1/2022 – 9/30/2024) Compliance Requirement: Cash Management Type of Finding: Significant Deficiency in Internal Control Over Compliance Recommendation: We recommend that the Agency review and enhance its internal controls to ensure that drawdowns are reviewed and approved in accordance with the Agency’s policies and procedures. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The Agency will review its current Federal draw procedures and identify appropriate role assignment to ensure appropriate internal controls exist to allow for a separation of duties and dual control of critical process steps. Scheduled Completion Date of Corrective Action Plan: July 1, 2025 Position Responsible for Implementation of Corrective Action Sean Cousino, Interim CFO sean.couisno@vermont.gov

View Audit 348596

Finding 537371 (2024-014)

Significant Deficiency 2024

State of Vermont

VT

Procurement, Suspension & Debarment § 200.219 § 200.303 § 200.324

Reference Number: 2024-014 Prior Year Finding: No Federal Agency: U.S. Department of the Treasury State Agency: Agency of Administration Federal Program: COVID-19 – Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Award Number and Year: SLFRP4407 (3/3/2021 – 12/31/...

Reference Number: 2024-014 Prior Year Finding: No Federal Agency: U.S. Department of the Treasury State Agency: Agency of Administration Federal Program: COVID-19 – Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Award Number and Year: SLFRP4407 (3/3/2021 – 12/31/2024) Compliance Requirement: Procurement Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend the Agency review and enhance internal controls and procedures to ensure that it maintains documentation that it competitively procures contracts and that it performs a cost analysis for all procurement actions in accordance with Agency of Administration Bulletin No. 3.5 and federal requirements. Views of responsible officials: Management agrees with the finding. Corrective Action Plan The Agency of Administration has written and published Procurement and Contracting Procedures known as Bulletin 3.5. Section 9.3.14 (Documentation) details the required documentation that should be placed in the contract file. The Department of Buildings and General Services (a department of the Agency of Administration), Office of Purchasing and Contracting, is charged with maintaining procurement documentation on behalf of the Office of the Secretary of Administration. Department of Buildings and General Services, Office of Purchasing and Contracting, will conduct an internal staff re-training on Bulletin 3.5, Section 9.3.14. In addition, the Office of Purchasing and Contracting will perform an internal review for procurements completed by the Secretary’s office to ensure they are in compliance. Scheduled Completion Date of Corrective Action Plan: BGS OPC Staff Training – June 30, 2025 BGS OPC Internal Review – December 31, 2025 Contacts for Corrective Action Plan: Doug Farnham, Chief Recovery Officer douglas.farnham@vermont.gov Deb Damore, Director, Office of Purchasing and Contracting deborah.damore@vermont.gov

View Audit 348596

Finding 537368 (2024-013)

Significant Deficiency 2024

State of Vermont

VT

Questioned Costs Cash Management Matching / Level of Effort / Earmarking § 200.303 § 200.343

Reference Number: 2024-013 Prior Year Finding: No Federal Agency: U.S. Department of Transportation State Agency: Agency of Transportation Federal Program: Federal Transit Cluster Assistance Listing Number: 20.500, 20.507, 20.526 Award Number and Year: VT-04-0021-01 (3/14/2013 – 6/30/2016) Complianc...

Reference Number: 2024-013 Prior Year Finding: No Federal Agency: U.S. Department of Transportation State Agency: Agency of Transportation Federal Program: Federal Transit Cluster Assistance Listing Number: 20.500, 20.507, 20.526 Award Number and Year: VT-04-0021-01 (3/14/2013 – 6/30/2016) Compliance Requirement: Cash Management, Period of Performance Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend that VTrans review and enhance grant closeout procedures and internal controls to ensure that grants are closed out timely. We further recommend that VTrans review and enhance procedures and internal controls over cash management to ensure that cash draws are performed only against grants for which the period of performance has not expired. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The following factors contributed to the noncompliance: VTrans experienced staff turnover, at which point close out processes were missed in 2016. This resulted in a grant remaining with an open status in the TrAMS system well beyond the period of performance. During the 2024 review by program staff, a drawdown was inadvertently processed for this grant with the expired period of performance. At the time, VTrans lacked a formal, documented grant closeout process for FTA grants in the TrAMS system. Additionally, there was a breakdown in communication between the Accounts Receivable (AR) team and the Public Transit Program team regarding period of performance eligibility prior to processing the draw. VTrans has taken the following steps to strengthen internal controls and prevent recurrence of this issue: 1. Formalized Closeout Procedures: VTrans has implemented a structured grant closeout process for the AOT Public Transit Program that clearly defines responsibilities, timelines, and verification steps to ensure all federal awards are closed timely and in compliance with FTA requirements. This process assigns specific tasks to designated staff members and ensures that no drawdowns occur after the period of performance has ended. 2. Annual Period of Performance Review: VTrans has established and documented an annual review process for FTA grant periods of performance. This review has been formally integrated into the Agency’s Public Transit cash management procedures, ensuring that grant end dates are proactively monitored, and necessary extensions or closeouts are addressed before expiration. 3. Enhanced Communication and Documentation: VTrans has updated the internal Excel file used to facilitate communication between the Public Transit Program team and the AR team. The file now includes a designated column for period of performance, ensuring that all drawdowns are reviewed for eligibility before processing. This is also addressed in an update to the Agency’s Public Transit cash management procedure memo. VTrans will coordinate with FTA to determine the appropriate resolution for these funds. Any necessary repayment or adjustments will be completed in accordance with FTA guidance. At this time, FTA has not requested the funds be returned. Scheduled Completion Date of Correction Action Plan: All corrective actions will be implemented as of March 1, 2025. Contacts for Corrective Action Plan: Ross MacDonald, Public Transit Director ross.macdonald@vermont.gov

View Audit 348596 Questioned Costs: $1

Finding 537367 (2024-012)

Significant Deficiency 2024

State of Vermont

VT

Matching / Level of Effort / Earmarking Special Tests & Provisions Significant Deficiency § 200.303

Reference Number: 2024-012 Prior Year Finding: No Federal Agency: U.S. Department of Transportation State Agency: Agency of Transportation Federal Program: Highway Planning and Construction Assistance Listing Number: 20.205 Award Number and Year: FFY2023 – FFY2024 Compliance Requirement: Special Tes...

Reference Number: 2024-012 Prior Year Finding: No Federal Agency: U.S. Department of Transportation State Agency: Agency of Transportation Federal Program: Highway Planning and Construction Assistance Listing Number: 20.205 Award Number and Year: FFY2023 – FFY2024 Compliance Requirement: Special Tests and Provisions – Wage Rate Requirements Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Recommendation: VTrans should review and enhance procedures and internal controls to ensure that it obtains weekly certified payrolls from all contractors. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The Daily Work Reports (DWRs) submitted by the contractor concluded the outstanding punchlist items in June 2023, and in September 2023 a subcontractor submitted a DWR to AOT. The project went through Completion and Acceptance (C&A) in December 2023. The C&A process required confirmation that payrolls were received but did not include a final complete-verification step before project closeout. As a result, missing payroll certifications went unnoticed. Additionally, the Civil Rights team was unaware of the subcontractor’s work report since their review is triggered by certified payroll submissions, not DWRs. VTrans is updating the C&A checklist to require final confirmation that all certified payrolls have been received before project closeout, with coordination from the Civil Rights team if any are missing. This checklist is to be verified by both the Resident Engineer and the Regional Engineer. To further strengthen compliance, VTrans Construction will focus on education, and revise pre-construction meeting templates to emphasize that federal wage reporting requirements apply to all work on a project. Additionally, VTrans Civil Rights will reinforce these requirements in annual contractor training to ensure Prime and Subcontractors fully understand their payroll reporting responsibilities. VTrans will also remain cognizant of projects and DWRs submitted by new subcontractors and actively work to educate contractors at this point to prevent future payroll omissions. Scheduled Completion Date of Corrective Action Plan: All corrective actions will be implemented as of April 1, 2025. Contacts for Corrective Action Plan: Douglas Bonneau, VTrans Construction Engineer douglas.bonneau@vermont.gov

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Finding 537366 (2024-011)

Significant Deficiency 2024

State of Vermont

VT

Subrecipient Monitoring Reporting § 200.208 § 200.303 § 200.332 § 200.425 § 200.513

Reference Number: 2024-011 Prior Year Finding: No Federal Agency: U.S. Department of Transportation State Agency: Agency of Transportation Federal Program: Highway Planning and Construction Assistance Listing Number: 20.205 Award Number and Year: FFY2023 – FFY2024 Compliance Requirement: Subrecipien...

Reference Number: 2024-011 Prior Year Finding: No Federal Agency: U.S. Department of Transportation State Agency: Agency of Transportation Federal Program: Highway Planning and Construction Assistance Listing Number: 20.205 Award Number and Year: FFY2023 – FFY2024 Compliance Requirement: Subrecipient Monitoring Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Recommendation: VTrans should review and enhance internal controls and procedures to ensure that all required federal award information is included in subawards and that on-site subrecipient monitoring is conducted timely per the terms of its subrecipient monitoring plan. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: Missing Federal Award Date: The Contract Administration, Grants Unit addressed the deficiency of missing federal award dates during the FY23 State Single Audit (in effect as of 1/12/2024). As part of the updated award execution process, the Grants Unit now verifies that all awards include the federal award date and applicable FAIN number. Awards executed prior to the implementation of this process are being updated during amendments to ensure compliance. Subrecipient Monitoring: The root cause of the subrecipient monitoring deficiency was staffing shortages, which affected the Agency of Transportations (AOT) ability to meet monitoring requirements on time. The AOT monitoring requirements have been transitioned from the Audit Bureau to the Contract Administration, Grants Unit. The Grants Unit has already identified and will prioritize Subrecipients based on the last date monitored. Workflow modifications to include efficiencies are also in progress. These efficiencies will help with timeliness. The revisions to the monitoring activities will be in the VTrans Granting Plan effective July 1, 2025. Scheduled Completion Date of Corrective Action Plan: All corrective actions will be implemented as of July 1, 2025. Contacts for Corrective Action Plan: Tricia Scribner, Administrative Services Manager III tricia.scribner@vermont.gov

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Finding 537362 (2024-010)

Significant Deficiency 2024

State of Vermont

VT

Questioned Costs Allowable Costs / Cost Principles Period of Performance § 200.303 § 200.308 § 200.309 § 200.403

Reference Number: 2024-010 Prior Year Finding: 2023-008; 2022-017 Federal Agency: U.S. Department of Labor State Agency: Vermont Department of Labor Federal Program: Unemployment Insurance Assistance Listing Number: 17.225 Award Number and Period: Admin 24A55UI000063 (10/1/2023-12/31/2026), DUA 23A6...

Reference Number: 2024-010 Prior Year Finding: 2023-008; 2022-017 Federal Agency: U.S. Department of Labor State Agency: Vermont Department of Labor Federal Program: Unemployment Insurance Assistance Listing Number: 17.225 Award Number and Period: Admin 24A55UI000063 (10/1/2023-12/31/2026), DUA 23A60UD000013 (7/14/2023 - 7/14/2026) Compliance Requirement: Period of Performance Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Recommendation: We recommend the Department review and enhance its procedures and controls to ensure that prior to charging costs to the program, they are incurred within an award’s allowable period of performance. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The Department will review its procedures and internal controls and update as necessary to ensure that expenditures are incurred within the allowable period of performance for respective awards. It should be noted that during the period of performance for which this audit was conducted there were a large number of personnel changes and shifts. The position that was responsible for the majority of these duties retired in January 2024. We proactively hired for her replacement a year before she retired. Over the course of the year our replacement took over more and more duties. In the process of this replacement, we have completed a tremendous amount of evaluation of our assigned duties, processes, workflow, training, and documentation. Not only in this role, but we are also undergoing a division and business unit wide analysis of our internal controls and workflow. It should also be noted that the UI admin funds are considered ‘formula funds’ from the US DOL. We are expected to run this program year-round with no gaps in service or performance. The funding that we receive from US DOL is based on an antiquated formula that breaks down the amount that is budgeted by Congress between 52 state and territories. We generally do not receive enough funding for the entire year. Also, with the recent trend of Congress to utilize the tool of the Continuing Resolution our funding is often ambiguous until most of the program year is over. We have at times seen our funding cut once a budget had been passed by Congress even though there was only about 3 months left in the program year. We are still expected to run this program and ‘find other sources of funding’. This does make the adherence to the period of performance challenging. However, as we evaluate our internal controls and procedures over the coming months, we will make note of every opportunity to strengthen this function to ensure that all charges applied to program funds are relevant, within the period of performance of the award, and are correctly reviewed and signed. Scheduled Completion Date of Corrective Action Plan: April 1, 2025 Contacts for Corrective Action Plan: Chad Wawrzyniak, Financial Director II chad.wawrzyniak@vermont.gov

View Audit 348596 Questioned Costs: $1

Finding 537361 (2024-009)

Significant Deficiency 2024

State of Vermont

VT

Questioned Costs Allowable Costs / Cost Principles Matching / Level of Effort / Earmarking § 200.303 § 200.403

Reference Number: 2024-009 Prior Year Finding: 2023-007; 2022-016 Federal Agency: U.S. Department of Labor State Agency: Vermont Department of Labor Federal Program: Unemployment Insurance Assistance Listing Number: 17.225 Award Number and Period: DUA 23A60UD000013 (7/14/2023 - 7/14/2026) Compliance...

Reference Number: 2024-009 Prior Year Finding: 2023-007; 2022-016 Federal Agency: U.S. Department of Labor State Agency: Vermont Department of Labor Federal Program: Unemployment Insurance Assistance Listing Number: 17.225 Award Number and Period: DUA 23A60UD000013 (7/14/2023 - 7/14/2026) Compliance Requirement: Allowable Costs/Cost Principles Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Recommendation: We recommend the Department reviews and enhances its procedures and controls regarding payment processing to ensure that, prior to charging costs to the program, they are supported and reviewed by a supervisor who is knowledgeable of the regulations regarding allowable program costs and that documentation of the review is maintained. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The Department will review its procedures and internal controls and update as necessary to ensure that expenditures are adequately reviewed and signed off on. It should be noted that during the period of performance for which this audit was conducted there were a large number of personnel changes and shifts. The position that was responsible for the majority of these duties retired in January 2024. We proactively hired for her replacement a year before she retired. Over the course of the year our replacement took over more and more duties. In the process of this replacement, we have completed a tremendous amount of evaluation of our assigned duties, processes, workflow, training, and documentation. Not only in this role, but we are also undergoing a division and business unit wide analysis of our internal controls and workflow. Scheduled Completion Date of Corrective Action Plan: April 1, 2025 Contacts for Corrective Action Plan: Chad Wawrzyniak, Financial Director II chad.wawrzyniak@vermont.gov

View Audit 348596 Questioned Costs: $1

Finding 537360 (2024-008)

Material Weakness 2024

State of Vermont

VT

Internal Control / Segregation of Duties Material Weakness Reporting § 200.303

Reference Number: 2024-008 Prior Year Finding: 2023-005; 2022-012; 2020-009 Federal Agency: Department of Labor State Agency: Vermont Department of Labor Federal Program: Unemployment Insurance Assistance Listing Number: 17.225 Award Number and Period: State UC, UCFE, UCX, TRA UI393002355A50 (10/202...

Reference Number: 2024-008 Prior Year Finding: 2023-005; 2022-012; 2020-009 Federal Agency: Department of Labor State Agency: Vermont Department of Labor Federal Program: Unemployment Insurance Assistance Listing Number: 17.225 Award Number and Period: State UC, UCFE, UCX, TRA UI393002355A50 (10/2022-9/30/2023), TRA 24A55UT000024 (10/1/2023-9/30/2024), RESEA UI380102260A50 (1/1/2022-9/30/2024) RESEA 23A60UR000010 (1/1/2023-9/30/2025), Admin UI393532355A50 (10/1/2022-12/31/2025), Admin 24A55UI000063 (10/1/2023-12/31/2026), ARPA Fraud UI370952155A50 (9/1/2021-8/31/2025), ARPA Equity UI370952155A50 (10/1/2022-10/31/2025), CARES UI347462055A50 (4/1/2021-6/30/2025), DUA 23A60UD000013 (7/14/2023 - 7/14/2026) Compliance Requirement: Reporting Type of Finding: Material Weakness in Internal Control over Compliance, Material Noncompliance Recommendation: We recommend that policies and procedures be implemented to ensure that all financial and performance reports are accurate, agree with supporting documentation, and are reviewed by an authorized State official prior to submission. We also recommend that supporting documentation and evidence of supervisory review is maintained and available for audit. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The Department is currently undergoing a division and business unit wide analysis of our internal controls and procedures. As part of that effort, the Department will review internal controls and update as necessary to ensure that all required reports are filed timely and accurately and that reports are reviewed and approved by authorized State officials prior to submission. Scheduled Completion Date of Corrective Action Plan: June 30, 2025 Contacts for Corrective Action Plan: Chad Wawrzyniak, Financial Director II chad.wawrzyniak@vermont.gov

View Audit 348596

Finding 537359 (2024-007)

Significant Deficiency 2024

State of Vermont

VT

Allowable Costs / Cost Principles Subrecipient Monitoring Period of Performance § 200.303 § 200.308 § 200.309 § 200.403

Reference Number: 2024-007 Prior Year Finding: No Federal Agency: U.S. Department of Defense State Agency: Vermont State Military Department Federal Program: National Guard Military Operations and Maintenance (O&M) Projects Assistance Listing Number: 12.401 Award Number and Period: W912LN2421001 (10...

Reference Number: 2024-007 Prior Year Finding: No Federal Agency: U.S. Department of Defense State Agency: Vermont State Military Department Federal Program: National Guard Military Operations and Maintenance (O&M) Projects Assistance Listing Number: 12.401 Award Number and Period: W912LN2421001 (10/1/2023 – 9/20/2024) Compliance Requirement: Period of Performance Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Recommendation: The Department should review and enhance its procedures and internal controls to ensure that it charges expenditures to the program that are incurred within an award’s allowable period of performance. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The Department agrees with this finding and will implement the following: • Update Accounts Payable Standard Operating Procedures to include instructions for determining the appropriate Federal Fiscal year for coding and paying vendor invoices. • Distribute updated procedures and train staff to ensure understanding of Period of Performance reporting requirements. • Update Vision query to include the Invoice Date field. Current reports used for preparing the SF-270 only include the Vision transaction date, therefore the preparer and reviewer are not able to determine the performance dates of individual transactions based on this report alone and rely on proper coding of the Class field during voucher entry. Adding the Invoice Date to the report will improve the department’s ability to QC the SF-270 for period of performance discrepancies prior to submission for reimbursement. • The Financial Director will perform quarterly audits of this Vision report to identify any improper reporting. Any errors identified will be corrected with a journal voucher and subsequently corrected on the next SF-270. Scheduled Completion Date of Corrective Action Plan: April 15, 2025 Contacts for Corrective Action Plan: Kim Fedele, Financial Director kimberly.fedele@vermont.gov

View Audit 348596

Finding 537343 (2024-027)

Significant Deficiency 2024

State of Vermont

VT

Allowable Costs / Cost Principles § 200.303 § 200.403

Reference Number: 2024-027 Prior Year Finding: No Federal Agency: U.S. Department of Agriculture U.S. Department of Health and Human Services State Agency: Department of Human Resources Agency of Human Services Federal Program: SNAP Cluster Temporary Assistance for Needy Families Child Support Servi...

Reference Number: 2024-027 Prior Year Finding: No Federal Agency: U.S. Department of Agriculture U.S. Department of Health and Human Services State Agency: Department of Human Resources Agency of Human Services Federal Program: SNAP Cluster Temporary Assistance for Needy Families Child Support Services Medicaid Cluster Assistance Listing Number: 10.551, 10.561, 93.558, 93.563, 93.775, 93.777, 93.778 Award Number and Year: 4VT400406 (10/1/2022 – 9/30/2023) 4VT402513 (10/1/2023 – 9/30/2024) 2301VTTANF (10/1/2022 – 9/30/2023) 2401VTTANF (10/1/2023 – 9/30/2024) 2401VTSCSS (10/1/2023 – 9/30/2024) 2305VT5MAP (10/1/2022 – 9/30/2023) Compliance Requirement: Allowable Activities/Allowable Costs - Payroll Type of Finding: Significant Deficiency in Internal Control Over Compliance Recommendation: We recommend that the Department review and enhance procedures and internal controls to ensure that VTHR uses rates of pay for attorneys that align with the maximum pay rates established by the Attorney Pay Plan. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The language in the attorney play plan will be clarified to be consistent with long-standing Department of Human Resources’ interpretation of the maximum hourly rate for certain attorney job titles. Specifically, the “whichever is lower” clause will be deleted from Staff Attorney III, Staff Attorney IV, and General Counsel I descriptions. This will leave the limiting language to be “or up to Department/Agency Head’s Salary.” This will allow the maximum salary to be capped at the department head’s salary, which is the intention of the pay plan. In addition, the compensation team will continue to audit all salary actions to ensure that no pay action will exceed the intended maximum salary. The Compensation Division of the Department of Human Resources will make these changes and publish the updated Attorney Pay Plan according to the agreed schedule. Scheduled Completion Date of Corrective Action Plan: The Corrective Action Plan will be completed by February 1, 2025. Contacts for Corrective Action Plan: Douglas Pine, Deputy Director doug.pine@vermont.gov

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Finding 537342 (2024-026)

Significant Deficiency 2024

State of Vermont

VT

Questioned Costs Cash Management Reporting § 200.303 § 200.514

Reference Number: 2024-026 Prior Year Finding: 2023-023 Federal Agency: U.S. Department of Agriculture U.S. Department of Health and Human Services State Agency: Department of Finance and Management Federal Program: SNAP Cluster Temporary Assistance for Needy Families CCDF Cluster Assistance Listing...

Reference Number: 2024-026 Prior Year Finding: 2023-023 Federal Agency: U.S. Department of Agriculture U.S. Department of Health and Human Services State Agency: Department of Finance and Management Federal Program: SNAP Cluster Temporary Assistance for Needy Families CCDF Cluster Assistance Listing Number: 10.551, 10.561, 93.558, 93.575, 93.596 Award Number and Year: 4VT400406 (10/1/2022 – 9/30/2023) 4VT402513 (10/1/2023 – 9/30/2024) 2301VTTANF (10/1/2022 – 9/30/2023) 2401VTTANF (10/1/2023 – 9/30/2024) 2301VTCCDD (10/1/2022 – 9/30/2025) 2401VTCCDD (10/1/2023 – 9/30/2026) Compliance Requirement: Cash Management Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend that Finance review and enhance its internal controls and procedures over the CMIA Annual Report to ensure that it verifies the correct interest rate is applied and that State and Federal interest liabilities are properly calculated in accordance with 2 CFR section 200.514. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The current available rate at the time of calculation, review, entry, and moving to draft were all accurate to what U.S. Treasury had available at the time. The rate was updated on December 3rd, after our submissions had already been locked via the draft process in the CMIAS portal done on November, 26th. The process was not fully submitted due to issues with the CMIAS portal not allowing us to submit which has been extensively documented via multiple email chains with U.S. Treasury CMIA over the past two years. Finance and Management will take a screenshot of the CMIA interest rate page dated on the review date of the CMIA Annual Report submissions from departments to ensure that we maintain the historical rate posted to the U.S. Treasury CMIA page at the time of review. Additionally, AHS will take their own screenshots of the CMIA Interest Rate page from U.S. Treasury website on the date of their Annual Report Summary submissions for record and to show that the rate from this time was checked and applied to the current year’s program. If during the review, there is any discrepancy between the review screen of the rates and the calculations screenshot of the rates; the calculation spreadsheets will be kicked back to AHS to be updated. Scheduled Completion Date of Corrective Action Plan: November 30, 2025 Contacts for Corrective Action Plan: Jordan Black-Deegan, Statewide Grants Administrator jordan.black-deegan@vermont.gov Sarena Boland, Financial Manager III sarena.boland@vermont.gov

View Audit 348596 Questioned Costs: $1

Finding 537341 (2024-006)

Significant Deficiency 2024

State of Vermont

VT

Procurement, Suspension & Debarment § 200.219 § 200.303 § 200.324

Reference Number: 2024-006 Prior Year Finding: No Federal Agency: U.S. Department of Agriculture State Agency: Agency of Human Services Federal Program: SNAP Cluster Assistance Listing Number: 10.551, 10.561 Award Number and Year: 4VT400406 (10/1/2022 – 9/30/2023) 4VT402513 (10/1/2023 – 9/30/2024) C...

Reference Number: 2024-006 Prior Year Finding: No Federal Agency: U.S. Department of Agriculture State Agency: Agency of Human Services Federal Program: SNAP Cluster Assistance Listing Number: 10.551, 10.561 Award Number and Year: 4VT400406 (10/1/2022 – 9/30/2023) 4VT402513 (10/1/2023 – 9/30/2024) Compliance Requirement: Procurement Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend the Agency review and enhance internal controls and procedures to ensure that it maintains documentation that it competitively procures contracts and that it performs a cost analysis for all procurement actions in accordance with Agency of Administration Bulletin No. 3.5 and federal requirements. Views of Responsible Officials: Management agrees with the finding. Corrective Action Plan: Due to the unique nature of a tropical storm hitting Vermont in 2011, which flooded the Waterbury State Office Complex (the Complex), all state operations were forced to temporarily move from the Complex to another facility while damages to the structure were remedied. Due to the significant number of records needing to be moved, the records in question may have been lost in this transition. Since then, we have instituted a new process that requires all bid submissions to be received and stored electronically. All bid submissions, cost analysis, and scoring of the bids are now kept in our electronic files instead of hard copy preventing physical damage or loss of records. Scheduled Completion Date of Corrective Action Plan: Completed and in full effect since December 31, 2020. Contacts for Corrective Action Plan: Melanie Rutledge, Financial Director I melanie.rutledge@vermont.gov Melanie Smit, Administrative Services Director I melanie.smit@vermont.gov Megan Smeaton, Financial Director IV megan.smeaton@vermont.gov Peter Moino, AHS Director of Internal Audit peter.moino@vermont.gov

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