Corrective Action Plans

FINDING 2024-005 Finding Subject: Title I - Eligibility Summary of Finding: The October 1 Real Time report could not be presented for audit for 2021-2022, which would have been used to pull in enrollment and poverty information for the 2022-2023 grant. As such, we were unable to verify the amounts reported in the grant application. Additionally, we were unable to verify if the correct socioeconomic status was properly reported for any of the students. Additionally, we were unable to verify nonpublic enrollment and poverty data included on the Title I application. Contact Person Responsible for Corrective Action: Janet McCreary Contact Phone Number and Email Address: 812-274-8001 jmccreary@madison.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: Due to the timing of the prior audit and the nature of the Real-Time report, this portion of the finding was not able to be completed timely for FY23’s grant. Beginning in FY24, The Data Management Specialist will save all reports submitted to the DOE. This will ensure that supporting documentation is kept that will be used determine Eligibility for Title I. Additionally, for the nonpublic enrollment and poverty data, the grants specialist meets with non-public partners to review enrollment information and verify the student population that encumbers funding. The data management specialist for MCS verifies all enrollment information and poverty identification in concert with the nutrition manager of MCS, building administrators, and the central office administration to verify all data reported to the state. Anticipated Completion Date: 6/30/2025

FINDING 2024-003 Finding Subject: Education Stabilization - Reporting Summary of Finding: The School Corporation had not designed, nor implemented, a system of internal controls to ensure that the annual Elementary and Secondary School Emergency Relief (ESSER) Data Collection reports (Reports) were complete and accurately submitted. The Reports were prepared by one employee without a documented oversight, review, or approval process in place to prevent, or detect and correct, errors. Contact Person Responsible for Corrective Action: Trina Huff Contact Phone Number and Email Address: (812) 689-4114, thuff@jaccendel.k12.in.us Views of Responsible Officials: We concur with the finding Description of Corrective Action Plan: Moving forward treasurer will provide even more information to the reviewer specifically pertaining to the findings and any other pertinent information for that person to have a better idea of what they are looking for and will keep documentation of the review being done and signed off on. Anticipated Completion Date: This will be corrected with the next round of ESSER reporting due January 2025.

Cash Management Management agrees with the finding and the auditor's recommendation. There was confusion at the time of this agreement as the nature of the work was in line with providing institutional services rather than a federal grant agreement. This led to a misunderstanding of cash management requirements due to the nature of the award. Mass General Brigham (MGB) has removed the $215K of questioned costs from the Schedule of Expenditures of Federal Awards (SEFA). The funding will be returned to Advanced Regenerative Manufacturing Institute, Inc. in January 2025. Additionally, management will review the limited instances where departments have been previously approved to request federal cash. This review is to confirm that an exception to the standard practice of managing this through the central Research Finance team is appropriate. Based on results of this review, to be completed by March 2025, management will determine criteria and prior approval requirements for departments to request federal cash if MGB concludes this practice will continue on a limited exception basis. The review will be conducted with oversight by the MGB Vice President of Research Management and Research Finance and the MGB Research Controller.

To Whom it may concern: This document serves as the response to the 2023-2024 Financial Audit on behalf of BELIEVE Schools, Inc. We’ve identified and addressed the comments that were included in the Uniform Guidance Major Program Findings. Please review the corrective action items in response to the Audit Results and Comments: Education Stabilization Fund (ESSER Grant): The school was unable to provide construction contracts to allow auditors to verify that the required Davis-Bacon Act wording was included. ● The Principal, Angel Jackson-Anderson, and Dean of Operations, Kayla Marshall, will ensure that the proper contracts are received and filed for all services conducted under ESSER grants. Child Nutrition: The school did not maintain tally sheets to support the number of meals served. ● The Dean of Operations, Kayla Marshall, will ensure that the proper physical files (tally sheets) are maintained and filed monthly, both in digital and paper form. The principal will review these files monthly to ensure documents are not lost or misplaced. If you have any questions, concerns, or comments, please feel free to contact me the school principal, Angel Jackson-Anderson, Aanderson@believeschools.org. Many thanks, Angel Jackson-Anderson Principal, BELIEVE Circle City High School Kayla Marshall Dean of Operations, BELIEVE Circle City High School www.believeschools.org @believeschoolsindy admin@believeschools.org 317-296-1954 Angel Jackson-Anderson 11/07/2024 02:25PM UTC

Elementary and Secondary School Emergency Relief – Assistance Listing No. 84.425D, 84.425U Recommendation: Auditor recommends the District review its grant reporting processes and implement internal controls to help ensure that there is adequate segregation of duties in regards to grant reporting including special reports and that all supporting documentation is maintained with the filed copy of the report. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: We continue to look for ways to segregate duties and will improve on the review process for grants but with the current financial situation, additional staff cannot be added. Name(s) of the contact person(s) responsible for corrective action: Lisa Miller Planned completion date for corrective action plan: Ongoing.

U.S. Department of Health and Human Services Program Name: Maternal and Child Health Services Block Grant Federal Assistance Listing Number: 93.994 Significant Deficiency, Nonmaterial Noncompliance - Reporting Finding 2024-006 Criteria or Specific Requirement: Per Section 200.303 of the Uniform Grant Guidance, a nonfederal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Per 2 CFR 200.334 the recipient must retain all Federal award records for three years from the date of submission of their final financial report. Condition: During the audit we tested 13 reports and noted the following: a) There were four (4) instances out of 13 reports tested where the submitted reports were unable to be provided, including the date of submission for the reports. b) There were 10 instances out of 13 reports tested where the County was unable to provide evidence the report was reviewed prior to submission. Questioned Costs: None. Effect: By not having the required documentation and underlying support, the County is not able to demonstrate compliance with the applicable requirements. Cause: The County did not have a formal policy to ensure documentation was retained to evidence review and submission of all reports. Recommendation: The County should consider creating a formalized policy to require all submitted reports and underlying data are retained in accordance with the Uniform Grant Guidance requirements. Views of Responsible Officials: Management agrees with the finding and is implementing procedures to correct this which is further discussed in the Corrective Action Plan. Corrective Action Plan: See Corrective Action Plan prepared by the County. The Health Department will create and adopt a policy to ensure that federal award reports and data are retained in accordance with Uniform Guidance. The Health Department will also collaborate with NCDHHS to develop a procedure to address circumstances when the required report consists of answering a NCDHHS survey or form that does not have “save” or “download” capability, making it difficult to retain the required documentation. In addition, the Health Department will develop a standard operating procedure whereby program managers document that they have reviewed federal award reports prior to submission. While review of grant reports is common, the Health Department did not have adequate documentation to demonstrate completion of this step. Completion Date: April 30, 2025 Responsible Person(s): Jana Harrison, Business Operations Director

Recommendation: We recommend the City enhance its internal control by implementing policies and procedures to track wage rate requirements compliance, and ensure that all certified payrolls and supporting wage-rate documentation are retained. Views of Responsible Officials: Management concurs with the finding. The City of Adelanto experienced higher than expected staff turnover in the finance department during the timeframe noted in this audit, which caused a backlog in audit preparation and submission, along with certain financial controls implementation interruption. At the time of this audit publishing, Management believes that implementation of such procedures is in compliance with the noted recommendation. Persons Responsible for Corrective Action: City Finance Staff (various) City Department Heads applying for grant funding (various) City Project Managers (various) Anticipated Completion Date for Corrective Action: Corrective action has been immediately implemented in response to the auditors’ recommendation. As financial reporting is still in the process of becoming current, the City anticipates finding to be removed in future fiscal years.

Recommendation: We recommended the City establish internal control procedures to ensure that all reimbursement requests are reviewed and approved by an authorized official prior to submission. Views of Responsible Officials: Management concurs with the finding. The City of Adelanto experienced higher than expected staff turnover in the finance department during the timeframe noted in this audit, which caused a backlog in audit preparation and submission, along with certain financial controls implementation interruption. At the time of this audit publishing, Management believes that implementation of such procedures is in compliance with the noted recommendation. Persons Responsible for Corrective Action: City Finance Staff (various) City Department Heads applying for grant funding (various) Anticipated Completion Date for Corrective Action: Corrective action has been immediately implemented in response to the auditors’ recommendation. As financial reporting is still in the process of becoming current, the City anticipates finding to be removed in future fiscal years.

Finding Reference Number: 2023-005 Description of Finding: Unable to provide supporting documentation for one expense sample. Statement of Concurrence or Nonconcurrence: The California Asian Pacific Chamber of Commerce (CalAsian) agrees with the finding. Corrective Action: CalAsian acknowledges that this finding is a deficiency in its procedures. The Director of Finance is reviewing the Chamber’s record retention policies and internal controls to ensure that they are in compliance with 2 CFR § 200.334, and will recommend and implement improvements as needed. Staff responsible for federal grants will receive training on documentation and retention requirements. Name of Contact Person: Ryan Fong, Director of Finance, 916-446-7883, rfong@calasiancc.org Pat Fong Kushida, President & CEO, 916-446-7883, patfongkushida@calasiancc.org Projected Completion Date: September 2025

Finding Number 2023-059 Subject Heading (Financial) or AL no. and program name (Federal) AL #84.425 – EDUCATION STABILIZATION FUND (ESF - AL #84.425D; 84.425R; 84.425U) Planned Corrective Action Beginning with FY23, the ESSER Performance Report (formerly known as the ESSER Annual Reporting) data from LEAs has been collected in our Grants Management System (GMS). This has increased the accuracy of data reported annually to USDE. Anticipated Completion Date March-2024 Responsible Contact Person Tammy Smith

Finding Number 2023-102 Subject Heading (Financial) or AL no. and program name (Federal) ALN: 21.027 Federal Program name: Coronavirus State And Local Fiscal Recovery Funds (CSLFRF) Planned Corrective Action Management Response The Oklahoma Office of Management and Enterprise Services – Grants Management Office (OMES-GMO), in coordination with the Oklahoma State Department of Health (OSDH), acknowledges the importance of maintaining effective internal controls and complying with federal record retention requirements, as outlined in 2 CFR § 200.303 and 2 CFR § 200.334. OMES-GMO and OSDH concur that improvements to the earlier implemented processes would have served to strengthen protocols designed to garner greater assurances for reimbursed expenditures. In the case identified, ongoing partnership with OMES-GMO resulted in OSDH proactively initiating an internal review, identifying the ineligible expenditures, and taking corrective steps to partially offset the unallowable amount. Subsequently, OSDH Finance has enhanced its internal reimbursement review procedures. As of 2023, all invoices and supporting documentation submitted by subrecipients are subject to a dual-layered review and approval by both OSDH Finance and OMES-GMO prior to reimbursement. This advancement in oversight provides additional controls to reasonably assure that agency expenditures are consistent with approved project scopes, allowable under federal cost principles, and fully documented. Additionally, current staff have received targeted training, and OSDH has implemented a formal onboarding process to ensure that all new staff are trained in federal grant compliance, documentation standards, and internal control requirements. Corrective Actions • Strengthened Review and Approval Process: All subrecipient reimbursements are now reviewed and approved in layers by both OSDH Finance and OMES-GMO staff and leadership prior to payment. This ensures supporting documentation is complete, expenditures are allowable, and spending aligns with the terms of the award. • Ongoing Staff Training and Onboarding: All existing staff participate in continued training on federal cost principles, subrecipient monitoring, and documentation standards. A structured onboarding program is now in place to ensure consistent compliance knowledge across all new hires. • Monitoring and Recoupment Protocols: Post-award monitoring procedures have been updated to support early detection of ineligible expenditures. OSDH will ensure prompt recoupment or reallocation actions are taken, when necessary, in accordance with federal guidelines. These corrective actions demonstrate OMESGMO’s and OSDH’s ongoing commitment to effective stewardship of federal funds, compliance with grant regulations, and continuous improvement of internal controls. Anticipated Completion Date 5/1/2025 Responsible Contact Person OMES: Parker Wise OSDH: Diane Brown, Danielle Smith, Tracey Douglas

Finding Number 2023-092 Subject Heading (Financial) or AL no. and program name (Federal) ALN: 21.019 Federal Program name: Emergency Rental Assistance Program (ERA) Planned Corrective Action Oklahoma Office of Management and Enterprise Services (OMES) disagrees with the report did include the demographic section, which is a required reporting element. Per the email titled 2025.03.24 Reporting download Issue OIG, page 7 of the pdf request verification the demographic data was received. On page 6 of the attachments a response states that the data for Q1, Q2 and Q3 2023 had been received. Oklahoma Office of Management and Enterprise Services (OMES) acknowledges the Oklahoma State Auditor and Inspector Office’s (SAI) findings that OMES did not implement the proper internal controls and oversight of the ERA Program during FY2023. However, OMES has taken steps to correct these findings and follow the recommendations set forth by SAI. Beginning with FY2025, OMES has taken the following measures: • Oversight and management of the ERA program has been transferred to the OMES Grant Management Office (OMES-GMO) which has staff with several years of grant experience. OMES-GMO has recently hired additional staff, and the two staff members dedicated to the management of the ERA program have 20+ years of combined federal grant specific experience. • To ensure that the subrecipient agreement includes all the required terms under the ERA Program and that the agreement does not expire, OMES-GMO and the Communities of Foundation of Oklahoma (CFO) have recently executed a Subrecipient Grant Agreement Amendment that details the responsibilities of OMES to monitor CFO and the duties and processes that CFO must follow in regard to ERA Program, including detailed cash management policies. See Attached – Grant Agreement Amendment. • OMES-GMO required the return of the remaining ERA2 Program funds from CFO to ensure proper oversight and review of ERA expenditures is performed. • OMES-GMO has a multi-level system of internal controls for grant management and oversight that includes routine monitoring, desk review, and site visits for all projects and associated project/administrative expenditures to ensure allowability, accuracy, and assist in the detection of fraud. For example, OMES-GMO’s process for disbursing funds to a subrecipient requires a written request from the subrecipient with supporting documentation, then OMES-GMO assigns a staff lead and secondary grant analyst to perform a primary and secondary review for compliance and to require additional supporting documentation if needed to approve the request. Once those reviews are completed and approved by the OMES- GMO staff, the Director of the OMES-GMO must approve the request before it is sent to the OMES Finance Division, who will then verify the calculated amount(s) before completing the disbursement to the subrecipient. These internal controls and policies have been implemented for the management and oversight of the ERA Program and provide a multi-layer review that will prevent fraud and risk factors applicable to the ERA program. Additionally, the OMES- GMO staff assigned to the ERA program have the training and knowledge to ensure compliance with the Federal grant requirements. • Depending on the level of risk, OMES-GMO conducts monthly, bi-weekly or weekly meetings with each subrecipient to monitor the progress of projects and address any issues or changes that might impact the project. For the ERA Program, OMES-GMO conducts bi-weekly monitoring meetings with CFO and is currently reviewing documentation provided by CFO to ensure all current ERA projects are eligible under the ERA guidelines and that CFO is exercising the proper oversight over their subrecipients. • OMES-GMO will continue with their current ERA monitoring steps and internal controls and will work with CFO to ensure ERA program funds are spent in accordance with ERA program guidelines and state and federal regulations. Anticipated Completion Date Ongoing throughout the life of the grant Responsible Contact Person Brandy Manek

Finding Number 2023-089 Subject Heading (Financial) or AL no. and program name (Federal) ALN: 21.019 Federal Program name: Emergency Rental Assistance Program (ERA) Planned Corrective Action While documenting controls over subrecipient administrative expenditures for the ERA 1 and ERA 2 grants, we noted that OMES did not require the subrecipients to submit supporting documentation for administrative expenditures charged to the programs. Further, we determined one of the subrecipients, Communities Foundation of Oklahoma (CFO), did not have sufficient internal controls over administrative expenditures to ensure they were for allowable costs and activities. Community Foundation of Oklahoma 1. For 15 of 17, or 88.24%, of credit cards tested, the included at least one expenditure for unallowable costs. These costs also included gift cards. ($53,248.41 questioned costs) • We disagree with the finding and questioned costs as the amount for all mentioned questioned costs has been returned to the ERA program. CFO has also strengthened their internal controls and understanding to more accurately identify appropriate expenses to allocate to ERA Admin funds in the future. See attached Internal Controls. 2. For $28,661 of allowable credit card administrative expenditures, the expense was attributable to multiple jurisdictions and only 90.33% of the cost should have been charged to the State of Oklahoma; however, CFO was unable to support the proper allocation was completed and that 100% of the cost was not charged to the State. We determined we would question 9.67% of the allowable expenditures ($2,771.52 questioned costs), since the State paid for expenditures that were the responsibility of other jurisdictions. Note: all credit card transactions were ‘multi’ jurisdictions; however, the unallowable costs are questioned in the first bullet. • See response to 2023-028 - Second Condition and Context. 3. For 2 of 48, or 4.17%, of claims tested, the invoice was not itemized, and we were unable to determine if the administrative costs were allowable. ($32,589.33 questioned costs) • We disagree with the finding. Itemized invoices have been attached in Attachment “OneDrive_1_4_22-2025.zip” 4. For 3 of 48, or 6.25%, of claims tested, the costs were for services to non-profit Shelterwell, which is an organization that was formed by the Executive Director of Community Cares Partners (CCP) with CCP team members after CCP stopped accepting ERA applications. Shelterwell works with tenants and landlords to provide education and mediation between tenants and landlords but is not legally part of Communities Foundation of Oklahoma (CFO)/CCP and does not directly provide rental assistance. Therefore, all payments to Shelterwell do not directly support the administration of the ERA program and are not allowable administrative costs. ($3,847.90 questioned costs) • We partially agree in that the expenses listed for Shelterwell were incorrectly allocated to the Admin account. These expenses should have been expensed from their ERA2 Housing Stability grants. CFO has strengthened our internal controls and understanding to more accurately code and identify expenses, so they are expensed to the correct fund in the future. We partially disagree that the payments made to Shelterwell are unallowable. According to the 2024 ERA Compliance Supplement and FAQ 23, 10% of the funds under ERA1 and ERA2 may be used for housing stability services. The 2024 Compliance Supplement in describing Administrative Expenses, states, "Under ERA 1, a grantee may use up to 10 percent of the total award amount for direct and indirect administrative costs and may use up to 10 percent of the total award amount for housing stability services. Under ERA 2, a grantee may use up to 15 percent of the total award amount for direct and indirect administrative costs and may use up to 10 percent of the total award amount for housing stability services ..." This is also repeated in FAQ23. According to both 2024 Compliance Supplement and FAQ23, housing stability services include but are not limited to: eviction prevention and eviction diversion programs; mediation between landlords and tenants; housing counseling; fair housing counseling; housing navigators or promotors that help households access programs or find housing; case management related to housing stability; housing-related services for survivors of domestic abuse or human trafficking; legal services or attorney’s fees related to eviction proceedings and maintaining housing stability; and specialized services for individuals with disabilities or seniors that support their ability to access or maintain housing. Additionally, under FAQ 21, grantees may use ERA payments to make subawards to other entities, including nonprofit organizations and local governments, to administer ERA programs on behalf of the grantees. Therefore, payments to Shelterwell are allowable expenses b/c these non-profits provided services that fell under the allowable uses for Housing Stability Services and CFO was able to make a subaward to these non- profits in accordance with FAQ 21. 5. For 3 of 48, or 6.25%, of claims tested, the costs were for services for non-profit SidexSide (formerly LastMile) also created by CFO/CCP, which is an organization that provides job skills training and connects employers with participants seeking employment. SidexSide is not legally part of CFO/CCP and does not directly provide rental assistance; therefore, payments made to SidexSide do not directly support the administration of ERA program and are not allowable administrative costs. ($8,824.00 questioned costs) • We partially agree in that the expenses listed for SidexSide were incorrectly allocated to the Admin account. These expenses should have been expensed from their ERA2 Housing Stability grants. CFO has strengthened our internal controls and understanding to more accurately code and identify expenses, so they are expensed to the correct fund in the future. We partially disagree that the payments made to SidexSide are unallowable. According to the 2024 ERA Compliance Supplement and FAQ 23, 10% of the funds under ERA1 and ERA2 may be used for housing stability services. The 2024 Compliance Supplement in describing Administrative Expenses, states, "Under ERA 1, a grantee may use up to 10 percent of the total award amount for direct and indirect administrative costs and may use up to 10 percent of the total award amount for housing stability services. Under ERA 2, a grantee may use up to 15 percent of the total award amount for direct and indirect administrative costs and may use up to 10 percent of the total award amount for housing stability services ..." This is also repeated in FAQ23. According to both 2024 Compliance Supplement and FAQ23, housing stability services include but are not limited to: eviction prevention and eviction diversion programs; mediation between landlords and tenants; housing counseling; fair housing counseling; housing navigators or promotors that help households access programs or find housing; case management related to housing stability; housing-related services for survivors of domestic abuse or human trafficking; legal services or attorney’s fees related to eviction proceedings and maintaining housing stability; and specialized services for individuals with disabilities or seniors that support their ability to access or maintain housing. Additionally, under FAQ 21, grantees may use ERA payments to make subawards to other entities, including non-profit organizations and local governments, to administer ERA programs on behalf of the grantees. Therefore, payments to SidexSide are allowable expenses b/c these non-profits provided services that fell under the allowable uses for Housing Stability Services and CFO was able to make a subaward to these non- profits in accordance with FAQ 21. See attached NON CC 3-SidexSide.program tie to housing stability. 6. For 4 of 48, or 8.33%, of claims tested, the costs were unallowable and included items such as trainings unrelated to ERA, gift cards, alcohol, and food. ($1,549.76 questioned costs) • We agree and the funds were returned. See Attachment “NON CC 4 Refund” 7. For 1 of 48, or 2.08%, of claims tested, the costs were for the Afghan Legal Network project which partnered with CFO to provide ERA funds to Afghanistan refugees; SAI determined these costs are unallowable as the refugees were not Oklahoma residents, and not eligible for assistance. Therefore, administrative costs related to this project were also unallowable. ($498.00 questioned costs) • The expense listed for ALN was incorrectly allocated to the Admin account. This expense should have been expensed from their ERA2 Housing Stability grants. CFO has strengthened our internal controls and understanding to more accurately code and identify expenses, so they are expensed to the correct fund in the future. See also the response to Finding 2023-027. 8. For 1 of 48, or 2.08%, of claims tested, the cost was unrelated to ERA and unallowable. CFO/CCP has refunded the expense using private funds after SAI determined it was unallowable. ($250.00 questioned costs) • We acknowledge that CFO has refunded this expense while the FY23 audit was in process. 9. For 27 of 48, or 56.25%, of claims tested, the cost was allowable; however, the expense was attributable to multiple jurisdictions and only 90.33% of the cost should have been charged to the State. However, CFO/CCP was unable to support the proper allocation was completed and that 100% of the cost was not charged to the State. We question 9.67% of the allowable expenditures ($16,527.61 questioned costs) • See the response to Finding 2023-028 – Second Condition and Context. Oklahoma Office of Management and Enterprise Services (OMES) acknowledges the Oklahoma State Auditor and Inspector Office’s (SAI) findings that OMES did not implement the proper internal controls and oversight of the ERA Program during FY2023. However, OMES has taken steps to correct these findings and follow the recommendations set forth by SAI. Beginning with FY2025, OMES has taken the following measures: • Oversight and management of the ERA program has been transferred to the OMES Grant Management Office (OMES-GMO) which has staff with several years of grant experience. OMES-GMO has recently hired additional staff, and the two staff members dedicated to the management of the ERA program have 20+ years of combined federal grant specific experience. • To ensure that the subrecipient agreement includes all the required terms under the ERA Program and that the agreement does not expire, OMES-GMO and the Communities of Foundation of Oklahoma (CFO) have recently executed a Subrecipient Grant Agreement Amendment that details the responsibilities of OMES to monitor CFO and the duties and processes that CFO must follow in regard to ERA Program, including detailed cash management policies. See Attached – Grant Agreement Amendment. • OMES-GMO required the return of the remaining ERA2 Program funds from CFO to ensure proper oversight and review of ERA expenditures is performed. • OMES-GMO has a multi-level system of internal controls for grant management and oversight that includes routine monitoring, desk review, and site visits for all projects and associated project/administrative expenditures to ensure allowability, accuracy, and assist in the detection of fraud. For example, OMES-GMO’s process for disbursing funds to a subrecipient requires a written request from the subrecipient with supporting documentation, then OMES-GMO assigns a staff lead and secondary grant analyst to perform a primary and secondary review for compliance and to require additional supporting documentation if needed to approve the request. Once those reviews are completed and approved by the OMES-GMO staff, the Director of the OMES-GMO must approve the request before it is sent to the OMES Finance Division, who will then verify the calculated amount(s) before completing the disbursement to the subrecipient. These internal controls and policies have been implemented for the management and oversight of the ERA Program and provide a multilayer review that will prevent fraud and risk factors applicable to the ERA program. Additionally, the OMES-GMO staff assigned to the ERA program have the training and knowledge to ensure compliance with the Federal grant requirements. • Depending on the level of risk, OMES-GMO conducts monthly, bi-weekly or weekly meetings with each subrecipient to monitor the progress of projects and address any issues or changes that might impact the project. For the ERA Program, OMES-GMO conducts bi-weekly monitoring meetings with CFO and is currently reviewing documentation provided by CFO to ensure all current ERA projects are eligible under the ERA guidelines and that CFO is exercising the proper oversight over their subrecipients. • OMES-GMO will continue with their current ERA monitoring steps and internal controls and will work with CFO to ensure ERA program funds are spent in accordance with ERA program guidelines and state and federal regulations. Anticipated Completion Date Ongoing throughout the life of the grant Responsible Contact Person Brandy Manek

Finding Number 2023-088 Subject Heading (Financial) or AL no. and program name (Federal) ALN: 21.019 Federal Program name: Emergency Rental Assistance Program (ERA) Planned Corrective Action Condition and Context: When reviewing SFY23 payroll administrative expenditures, we noted that Communities Foundation of Oklahoma paid $2,372,400 in bonuses to 146 employees. Of these bonuses, 47 people received between $10,000 - $19,999, and 44 people received more than $20,000. We found the expenditures to be unallowable; we found no guidance that stated ERA administrative funds could be expended on bonuses. • Community Cares Partners (CCP) was established as a temporary, emergencyresponse initiative tasked with administering Emergency Rental Assistance Program (ERAP) funds on behalf of the State of Oklahoma and multiple jurisdictions. Although initially conceived as a short-term project, CCP ultimately administered nearly $150 million in federal funds over multiple years in response to a historic public health and housing crisis. To meet U.S. Treasury mandates to rapidly disburse funds—or risk recapture—CCP had to scale quickly, adapt continuously, and deliver results under unprecedented pressure. The complexity of federal guidance, evolving compliance expectations, and intense audit scrutiny required a workforce that was agile, highly skilled, and capable of operating in a fast- paced, high-stakes environment. To achieve this, Communities Foundation of Oklahoma (CFO), as CCP’s fiscal sponsor, implemented an innovative staffing model in which all CCP team members—including leadership—were engaged as independent contractors. This model allowed for rapid onboarding and deployment of services without placing undue strain on CFO’s internal team or disrupting the core functions of other nonprofit and government agencies during the pandemic. However, because these contractors were not employees, they did not receive traditional benefits such as health insurance, paid time off, or retirement contributions. To support retention, motivation, and high performance in the absence of such benefits, CCP established a performance bonus structure, as outlined in its “Fee-for-Services Rendered” policy. Bonuses were based on merit and tied directly to both individual and team accomplishments. Performance Bonuses Were Structured, Purposeful, and Aligned with Program Goals Bonuses were awarded in recognition of critical achievements, such as the complete spend-down of ERA-1 funds before the federal deadline—a milestone that required sustained, coordinated effort well beyond routine contract deliverables. These incentives were calculated using a combination of objective factors, including: · Tenure with the organization (recognizing longterm commitment); Recommendation of the team director (based on direct performance observations); · Average weekly hours worked (accounting for parttime vs. full-time contributions); · Pay rate and level of responsibility (reflecting role complexity and expectations); · Performance indicators such as quality of work, accuracy, initiative, leadership, teamwork, positive attitude, and contributions to process improvements. Bonuses were not automatic or uniformly distributed. Rather, they were awarded based on documented performance and in alignment with the responsibilities and accomplishments of each contractor. The process involved director-level recommendations and required approvals from CCP’s Chief Operating Officer and the Executive Director of CFO, ensuring appropriate oversight and accountability. Allowability Under Federal Guidelines While the ERA guidance does not specifically address performance bonuses, U.S. Treasury FAQs instruct grantees to establish their own internal policies and procedures—consistent with the statutes—and to follow them consistently when specific guidance is not provided. CCP’s bonus practices followed this directive. Moreover, the incentive structure aligns with the principles in 2 CFR § 200.430(f), which permits incentive compensation when it is reasonable, tied to performance, and paid pursuant to a good-faith agreement established before services are rendered. These bonus payments were not arbitrary. They were essential tools for incentivizing high-quality performance, encouraging efficiency and innovation, and sustaining a capable team during a national emergency. Each bonus was grounded in documented policy, approved through established protocols, and tied to clearly defined. For 4 of 116, or 3.45% of claims tested, the contract was for an unreasonable rate and the invoices provided were not itemized and specific enough to determine if the time spent was for an allowable activity related to ERA 1 or ERA 2. • The contract rates for CCP’s executive leadership—specifically, Executive Director and Chief Operating Officer were reasonable and justified given the scope of responsibility, experience, and industry standards. Both leaders operated as full-time independent contractors (a structure applied to all team members at CCP), and neither received employee benefits such as health insurance or paid time off, which materially impacts total compensation calculations. CCP was a high-capacity public-private partnership program of CFO. CCP/CFO was responsible for administering over $440 million in Emergency Rental Assistance Program (ERAP) funds from the U.S. Department of the Treasury on behalf of the State of Oklahoma and multiple local jurisdictions. CCP executive leadership managed a team of more than 150 individuals and carried out complex, time- sensitive operations to deliver critical housing stability services during the COVID- 19 public health emergency. Industry benchmarks (e.g., Guidestar / Candid data, 990 analyses) show that for nonprofits with comparable annual budgets ($150M+), full-time executive compensation for experienced leaders often ranges from $175,000 to over $300,000 annually— excluding benefits. Both contractors brought more than 15 years of relevant leadership experience and operated within that reasonable range. Their rates reflected both the magnitude of the public responsibility and the demands of launching and managing a large-scale, federally funded program under emergency conditions. Regarding invoice specificity, the submitted invoices reflected agreed- upon deliverables and outcomes consistent with contract terms and allowable activities under federal guidance. While not time-stamped or broken down by hour, they were reviewed and approved based on performance milestones. Additional documentation is uploaded to further demonstrate the alignment of time spent with allowable ERAP administrative activities. Invoices submitted followed the contract terms, including hours rendered. A sample calendar page was provided and redacted for PII. § 200.338 Restrictions on public access to records. For 9 of 116, or 7.76% of claims tested, the payment was for more than the contracted rate. • PARTIALLY AGREE: overpayment of $37 • DISAGREE: see Bonus justification below. • 4.2.22 addendum with $29.60/hr rate • 4.2.22 addendum with $29.60/hr • 4.2.22 addendum with $36/hr rate • 4.2.22 addendum with $31.25/hr rate • 4.2.22 addendum with $29.60/hr rate • 4.2.22 addendum with $38/hr rate • 4.2.22 addendum with $28/hr rate Also see CCP Contractor Increases April, 2022 spreadsheet Attachments OneDrive_1_4-22-2025 OneDrive_3_4-22-2025- Contracts For 23 of 116, or 9.83% of claims tested, the subrecipient was unable to provide a contract for the period paid. • The Independent contractors each signed contracts in 2021 which laid out specific terms and conditions under which the independent contractors would provide their services and be compensated. Although some of these contracts expired, second contracts and/or addendums were signed by those same independent contractors in 2023. The independent contractors continued to work under the same terms and conditions and continued to be paid the same remuneration in the time period between the expiration of the original contracts and when the new contracts and/or addendums were created and signed. According to 15 O.S. Section 133, an implied contract is on where the existence and terms are not explicitly stated but are inferred from the conduct of the parties. Because the original contracts contained the specific terms regarding services and payment and because these independent contractors continued to operate under those same terms and receive payment even in the interim between signed contracts, this shows that an implied contract existed under Oklahoma law. The original contracts expired in 2021 which was at the height of the Covid- 19 crisis. The entities involved were addressing more urgent matters to assist the people of Oklahoma with the objectives of the program and did not have the bandwidth to draft and sign new agreements when responding to more urgent matters. Therefore, given the surrounding circumstances and the overall intent of the parties, it can be logically deduced that an implied contract existed in the interim periods between any expiration of an original contract and the second contract and/or addendum being signed. For 9 of 116, or 7.76% of claims tested, the contract was not signed by the Executive Director and was not valid. • We partially agree the contracts for three are not currently available with the Executive Director’s signature. • We disagree, fully executed contracts for two are available for review in the attachment OneDrive_3_4-22- 2025. For 22 of 115, or 19.13% of claims tested, the payroll cost was allowable; however, the expense was attributable to multiple jurisdictions and only 90.33% of the cost should have been charged to the State of Oklahoma, but the subrecipient was unable to support the allocation was completed and that 100% of the cost was not charged to the State. • See response to audit finding 2023-028 regarding the second Condition and Context. Oklahoma Office of Management and Enterprise Services (OMES) acknowledges the Oklahoma State Auditor and Inspector Office’s (SAI) findings that OMES did not implement the proper internal controls and oversight of the ERA Program during FY2023. However, OMES has taken steps to correct these findings and follow the recommendations set forth by SAI. Beginning with FY2025, OMES has taken the following measures: • Oversight and management of the ERA program has been transferred to the OMES Grant Management Office (OMES-GMO) which has staff with several years of grant experience. OMES-GMO has recently hired additional staff, and the two staff members dedicated to the management of the ERA program have 20+ years of combined federal grant specific experience. • To ensure that the subrecipient agreement includes all the required terms under the ERA Program and that the agreement does not expire, OMES-GMO and the Communities of Foundation of Oklahoma (CFO) have recently executed a Subrecipient Grant Agreement Amendment that details the responsibilities of OMES to monitor CFO and the duties and processes that CFO must follow in regard to ERA Program, including detailed cash management policies. See Attached – Grant Agreement Amendment. • OMES-GMO required the return of the remaining ERA2 Program funds from CFO to ensure proper oversight and review of ERA expenditures is performed. • OMES-GMO has a multi-level system of internal controls for grant management and oversight that includes routine monitoring, desk review, and site visits for all projects and associated project/administrative expenditures to ensure allowability, accuracy, and assist in the detection of fraud. For example, OMES-GMO’s process for disbursing funds to a subrecipient requires a written request from the subrecipient with supporting documentation, then OMES-GMO assigns a staff lead and secondary grant analyst to perform a primary and secondary review for compliance and to require additional supporting documentation if needed to approve the request. Once those reviews are completed and approved by the OMES-GMO staff, the Director of the OMES-GMO must approve the request before it is sent to the OMES Finance Division, who will then verify the calculated amount(s) before completing the disbursement to the subrecipient. These internal controls and policies have been implemented for the management and oversight of the ERA Program and provide a multilayer review that will prevent fraud and risk factors applicable to the ERA program. Additionally, the OMES-GMO staff assigned to the ERA program have the training and knowledge to ensure compliance with the Federal grant requirements. • Depending on the level of risk, OMES-GMO conducts monthly, bi-weekly or weekly meetings with each subrecipient to monitor the progress of projects and address any issues or changes that might impact the project. For the ERA Program, OMES-GMO conducts bi-weekly monitoring meetings with CFO and is currently reviewing documentation provided by CFO to ensure all current ERA projects are eligible under the ERA guidelines and that CFO is exercising the proper oversight over their subrecipients. OMES-GMO will continue with their current ERA monitoring steps and internal controls and will work with CFO to ensure ERA program funds are spent in accordance with ERA program guidelines and state and federal regulations. Anticipated Completion Date Ongoing throughout the life of the grant Responsible Contact Person Brandy Manek

Finding Number 2023-028 Subject Heading (Financial) or AL no. and program name (Federal) ALN: 21.019 Federal Program name: Emergency Rental Assistance Program (ERA) Planned Corrective Action Condition and Context: While documenting controls over subrecipient program and administrative expenditures for the ERA 1 and ERA 2 grants, we noted that OMES did not require the subrecipients to submit supporting documentation for expenditures charged to the programs. Further, we determined one subrecipient, Communities Foundation of Oklahoma (CFO) did not have sufficient internal controls over program or administrative expenditures to ensure they were for allowable costs and activities. • Oklahoma Office of Management and Enterprise Services (OMES) acknowledges the Oklahoma State Auditor and Inspector Office’s (SAI) findings that OMES did not implement the proper internal controls and oversight of the ERA Program during FY2023. However, OMES has taken steps to correct these findings and follow the recommendations set forth by SAI. Beginning with FY2025, OMES has taken the following measures: • Oversight and management of the ERA program has been transferred to the OMES Grant Management Office (OMES-GMO) which has staff with several years of grant experience. OMES-GMO has recently hired additional staff, and the two staff members dedicated to the management of the ERA program have 20+ years of combined federal grant specific experience. • To ensure that the subrecipient agreement includes all the required terms under the ERA Program and that the agreement does not expire, OMES-GMO and the Communities of Foundation of Oklahoma (CFO) have recently executed a Subrecipient Grant Agreement Amendment that details the responsibilities of OMES to monitor CFO and the duties and processes that CFO must follow in regard to ERA Program, including detailed cash management policies. See Attached – Grant Agreement Amendment. • OMES-GMO required the return of the remaining ERA2 Program funds from CFO to ensure proper oversight and review of ERA expenditures is performed. • OMES-GMO has a multi-level system of internal controls for grant management and oversight that includes routine monitoring, desk review, and site visits for all projects and associated project/administrative expenditures to ensure allowability, accuracy, and assist in the detection of fraud. For example, OMES-GMO’s process for disbursing funds to a subrecipient requires a written request from the subrecipient with supporting documentation, then OMES-GMO assigns a staff lead and secondary grant analyst to perform a primary and secondary review for compliance and to require additional supporting documentation if needed to approve the request. Once those reviews are completed and approved by the OMES- GMO staff, the Director of the OMES-GMO must approve the request before it is sent to the OMES Finance Division, who will then verify the calculated amount(s) before completing the disbursement to the subrecipient. These internal controls and policies have been implemented for the management and oversight of the ERA Program and provide a multi-layer review that will prevent fraud and risk factors applicable to the ERA program. Additionally, the OMESGMO staff assigned to the ERA program have the training and knowledge to ensure compliance with the Federal grant requirements. • Depending on the level of risk, OMES- GMO conducts monthly, bi-weekly or weekly meetings with each subrecipient to monitor the progress of projects and address any issues or changes that might impact the project. For the ERA Program, OMES-GMO conducts bi-weekly monitoring meetings with CFO and is currently reviewing documentation provided by CFO to ensure all current ERA projects are eligible under the ERA guidelines and that CFO is exercising the proper oversight over their subrecipients. • OMES-GMO will continue with their current ERA monitoring steps and internal controls and will work with CFO to ensure ERA program funds are spent in accordance with ERA program guidelines and state and federal regulations. • Community Foundation of Oklahoma (CFO) Due to a classification misunderstanding, CFO recently changed its financial process and is currently tracking expenditures as a subrecipient. CFO does have internal controls for expenditures and using their established process to update the tracking of their expenditures. (attachment internal controls – expenditures) CFO is reconciling the administrative expenses to capture and show the costs associated with administering the program. Condition and Context: While reviewing all administrative management fees, we noted one of the subrecipients charged the ERA 1 and ERA 2 grants $5,585,126.89 in unallowable administrative costs (management fees) that were retained by the subrecipient and were not attributable to providing financial assistance and housing stability services. The management fees the subrecipient charged to the grant do not represent actual admin expenditures, but rather an arbitrary amount retained by CFO (Questioned costs - $5,585,126.89). See management fees referenced in finding 2023-091. • A spreadsheet showing administrative expenses for FY23 is included with the finding response. CFO has used the allocable percentage of 90.33%, as provided by SAI in the finding 2023-088, to show the portion of expenditures attributed to the state ERA program. All previous and subsequent years are currently going through the same reconciliation effort. Any charges that were deemed unallowable by SAI during this audit or previous audits, such as credit card charges, will be removed from the actual expenditures spreadsheet and noted in the financial software. Transactional data from the subrecipients' financial system are included as backup for the administrative expenses. Documentation was previously not requested for CFO’s expenditures. Supporting documentation is being provided at this time to substantiate the response more fully. CFO has included a sample of personnel expenses in the response to this finding as a show of good faith. (Attachment 2022-08 CFO Payroll Support Docs, OneDrive _1 _4 _22-2025) Condition and Context: In addition, during our test work for the ERA 1 program administrative limit, we noted that administrative costs charged to the program exceeded the 10% allowable limit by 5.81%, or $1,259,429 • Being this is a multiple year grant program that was set up as earned administrative funds based upon programmatic spend, an ebb and flow of admin earned, and expended, is directly in relation to the programmatic spend. Looking at one fiscal year as a snapshot does not present the entire picture accurately. Over the course of the grant, the administrative funds earned have been at or under the cap established by Treasury. accurately. Over the course of the grant, the administrative funds earned have been at or under the cap established by Treasury. Anticipated Completion Date Ongoing throughout the life of the grant Responsible Contact Person Brandy Manek

Finding Number 2023-027 Subject Heading (Financial) or AL no. and program name (Federal) ALN: 21.019 Federal Program name: Emergency Rental Assistance Program (ERA) Planned Corrective Action AUDIT BULLET POINT “Activities Allowed or Unallowed and Allowable Costs/Cost Principles and Eligibility exceptions: • For 22 of 89, or 24.72%, of items tested, the applicant was an Afghanistan refugee and not a renter who lived in Oklahoma at the time of applying for assistance; therefore, they were not eligible, and the payment was unallowable. The subrecipient, Communities Foundation of Oklahoma, paid for the applicant to be in a hotel and then subsequently paid for their rent and utilities. Since the applicants were not eligible all payments were unallowable; therefore, we did not determine if the payment was calculated correctly or if the assistance exceeded 15 months for ERA 1 or 18 months for ERA 2. However, of these unallowable costs, we noted the following: • Some applicants were reimbursed for monthly lawn services as part of their monthly rental payment. • Several payments were made to the applicants after the initial payment without receiving an additional application or additional funds request (AFR) form (See FAQ #10).” OMES RESPONSE: The State disagrees that payments made to Afghan refugees were unallowable. The finding asserts that 22 applicants were ineligible for Emergency Rental Assistance (ERA) because they were Afghan refugees and were not “renters who lived in Oklahoma at the time of applying.” This interpretation is inconsistent with U.S. Department of the Treasury guidance, which does not require U.S. citizenship, legal residency, or prior tenancy in Oklahoma as a condition of eligibility. • Citizenship or Legal Residency Is Not a Requirement for ERA Eligibility. It is never mentioned in the ERA statute or Treasury guidance that U.S. citizenship, lawful residency, or duration of tenancy required. The U.S. Treasury’s ERA FAQ #1 explicitly outlines the four criteria for eligibility: • The household must be obligated to pay rent on a residential dwelling; • One or more individuals within the household must have experienced financial hardship due to the pandemic; • The household must demonstrate a risk of homelessness or housing instability; • Household income must be at or below 80% of area median income (AMI). These Afghan households were invited by our government leaders to resettle in Oklahoma as part of the federal government’s Operation Allies Welcome initiative. When the Afghans arrived in Oklahoma, they immediately sought housing, being assisted by agencies such as Catholic Charities. Obviously, they were not homeowners. As tenants or households seeking to rent housing during the midst of a pandemic without any immediate means of securing employment, they were experiencing housing instability and fully met the ERA Program 1 and 2 criteria. Upon arrival: • They were not homeowners; • They had no permanent housing; • They were working with nonprofit agencies like Catholic Charities to find housing; • Because of the pandemic, they were not able to secure work and had no or extremely low income; • They were at imminent risk of homelessness. Treasury has further emphasized in FAQ #1, “… these requirements provide for various means of documentation so that grantees may extend this emergency assistance to vulnerable populations without imposing undue documentation burdens…” Again, never is the word “residence or citizen” used, even in the footnotes. This language was clearly intended to include undocumented individuals, newly arrived refugees, and others in nontraditional or transitional housing situations. Furthermore, as noted in the CFO/CCP ERA application for rental assistance previously provided to SAI, the eligibility requirements do not require residency but that only the applicant live in the State of Oklahoma. Further Support: • September 9, 2021, Email between CCP/CFO and the Director of Tax and Housing Advocacy for the National Council of State Housing Agencies. Discusses that CCP was working with housing stability service partners, specifically Catholic Charities, to help with housing Afghans when they came to Oklahoma. Emails also clarify that the Afghan refugees would only be able to apply once they moved to Oklahoma. (See attached) • Sept 29, 2021 – Email from U.S. Dept. of State, Bureau of Populations, Refugees, and Migration (PRM), U.S. Department of State, which invited a variety of Federal Agency representatives to a call to hear from the OK Catholic Charities director to speak about the Oklahoma Catholic Charities “model of utilizing CARES Act funding to support both temporary and long term housing for Afghan arrivals and an additional hour was set aside for discussion of this model. Executive Director of the Oklahoma City Catholic Charities forwarded this email to CCP asking if she would join to assist with the discussion of this model. Listed below are the agencies that had representatives on the email. the National Security Council and Subcommittees  The White House – Organization of the National Security Council and Subcommittees  Executive Office of the President.  U.S. Department  Federal FEMA Office  U.S. Citizenship and Immigration Services  Homeland Security  Catholic Charities  U.S. Conference of Catholic Bishops  Administration of Children & Families  Governors, Biden Administration point person for Afghan Parolee Assistance. (See attached) • October 3, 2021, Follow-up Email thanking people regarding the presentation and for joining the call. “The insight, creativity, and partnership is inspiring and has the potential to assist so many Afghans.” Furthermore, an email was to the attendees of the presentation clarifying ERA as the funding source for Oklahoma’s model for developing housing resource for Afghan arrival. Additionally, it was stated that “We hope that these clarifications and enclosed links will help us understand how these funds may be leveraged to house Afghans when they are resettled from the bases to other locations around the country.” (see attached) • October 24, 2021, Email from ERA Outreach Team Leader, Emergency Housing Team, U.S. Department of the Treasury, to CCP wanting to connect them with Chicago who was looking to do some work with asylum seekers/refugees and was wanting to talk to other grantees who have worked with these populations using ERA funds. Note, this is an ERA Team Leader from the Treasury wanting CCP to share CCP/CFO’s ERA model. Obviously, the Treasury would not reach out to connect CCP/CFO to speak about their Afghan refugee model if they did not approve of the use of ERA funds to assist with housing the refugees. (See attached) • Treasury FAQ #37 – Addresses how grantees can promote access to assistance for all eligible households and is clear that the Guidance contemplates serving individuals from all background and nationalities, stating that grantees “should address barriers … including by providing program documents in multiple languages.” Furthermore, the Guidance states “Grantees should also provide, whether directly or through partner organizations, culturally and linguistically relevant outreach and housing stability services to ensure access to assistance for all eligible households.” In accordance with Title VI of the Civil Rights Act of 1964 (Title VI) ERA grantees must ensure they provide meaningful access to their limited-Englishproficiency (LEP) applicants and beneficiaries of their federally assisted programs, services, and activities. Finally, “Denial of an LEP person’s access to federally assisted programs, services, and activities is a form of nationalorigin discrimination prohibited under Title VI and Treasury’s Title VI implementing regulations at 31 CFR Part 22.” • Treasury guidance on creating applications for the ERA program with no mention of citizenship or residency requirements. Allow applicants to progress and self-attest if they cannot provide documentation - At the stage when applicants are asked to provide documents to establish COVID hardship, housing instability, income, or rental obligation, applicants should also be informed that they may self-attest and move forward in the application if they do not have those documents. • Disaster Housing Recovery Coalition, C/O National Low Income Housing Coalition (NLIHC) – Published an information sheet for recipients of Federal awards in response to the COVID-19 pandemic which detailed which awards did not consider immigration status when providing assistance. Under the ERA Program, the NLIHC stated that “The law establishing the Emergency Rental Assistance Program does not impose restrictions based on immigration status.” (Attached – labeled FAQs- Eligibility for Assistance Based on Immigration Status) 2. Hotel Stays Are Allowable Options for Temporarily Displaced Households Treasury provided a Broader Reading of “Obligated to Pay Rent on a Residential Dwelling,” and determined the costs of staying in a hotel are eligible expenses, and rental assistance could be provided to temporarily displaced households living in hotels. The audit finding narrowly interprets the term “obligated to pay rent” in FAQ #1. However, multiple Treasury FAQs — including FAQ #7, #26, and #35 — demonstrate that the Department intended a flexible, inclusive interpretation, recognizing the emergency nature of the program and the housing challenges faced by displaced individuals and families and reinforces that the term “residential dwelling” is not limited to traditional apartments with leases but includes hotels and other temporary housing used in transition. • FAQ #7: Permits hotel or motel costs to be covered using ERA funds when the household lacks alternative housing options, even without a formal lease. • FAQ #26: States that rental assistance may be provided to households residing temporarily in hotels or motels when they are • displaced or between housing. FAQ #27: Allows rental assistance for rent-to- own households, further demonstrating that the key is ERA CANNOT be used for homeowners (FAQ #20). • FAQ #35: Specifically authorizes relocation assistance for households who have been evicted or otherwise displaced and are attempting to secure new permanent housing. These provisions explicitly contemplate support for individuals and families—such as Afghan refugees— who were temporarily displaced and used hotels as the only available rental housing (in truth, many Oklahomans are forced to do this) until suitable housing could be secured (rendered more difficult for larger families – up to 10+ children). As allowed under Treasury ERA FAQs #7 and #26, hotel stays were covered when used as transitional housing due to lack of available rental stock—especially for large families. Afghan refugees fell squarely within this provision. 3. Lawn Services as Part of Rent This is allowable as part of the cost of the rental of the premises. For all rentals that have a yard there is lawn maintenance, and the landlord has the option to determine how to charge (or absorb) that cost. These costs were not reimbursed as separate utility costs, but as part of the monthly rental obligation agreed to in writing. 4. Subsequent Payments Without AFR Forms • ERA guidance allows grantees to implement streamlined processes to reduce burden and deliver aid efficiently. CCP’s internal policies permitted continued rental and utility assistance without requiring new applications or additional AFR forms, so long as eligibility remained unchanged and appropriate documentation was on file. This approach is aligned with Treasury’s consistent encouragement to minimize administrative barriers in the interest of program responsiveness and urgency. Treasury guidance also stated, Only ask applicants for information that is required by the ERA statutes and Treasury’s guidance to provide them assistance. AUDIT BULLET POINT “Further, while summarizing the data on ‘applicant’, we noted one line item was made up of 498 individual payments made to hotels on behalf of the Afghanistan refugees, which consisted of 186 applicants. We identified 185 of these applicants had payments for Afghanistan refugees to live in hotels prior to applying to the ERA program. Since, at the time of the application, they were not obligated to pay rent on a residential dwelling per Department of Treasury FAQ 1 and established CCP ERA policy, the cost is unallowable. This resulted in $1,727,687.64 in questioned costs (these costs do not include payments previously questioned in the first bullet).” OMES RESPONSE: OMES disagrees with this finding. Multiple Treasury FAQs, including #7, #26, and #35, reinforces the term “residential dwelling” is not limited to traditional apartments but may include hotels and other temporary housing used in transition. Also, FAQ #8 states that a beneficiary is not required to have rental arrears to receive assistance and permits enrollment “of households for only prospective benefits.” The only restriction is that for the ERA1 program, if an applicant is requesting prospective assistance and the applicant also has rental arrears, the grantee must also provide assistance to reduce those arrears (this restriction does not apply to ERA2). Finally, per FAQ # 13, eligible households do not have to be in their current rental home when the COVID-19 public health emergency was declared, stating, “Payments under ERA are provided to help households meet housing costs that they are unable to meet as a result of the COVID-19 pandemic. There is no requirement regarding the length of tenure in the current unit.” Oklahoma Office of Management and Enterprise Services (OMES) acknowledges the Oklahoma State Auditor and Inspector Office’s (SAI) findings that OMES did not implement the proper internal controls and oversight of the ERA Program during FY2023. However, OMES has taken steps to correct these findings and follow the recommendations set forth by SAI. Beginning with FY2025, OMES has taken the following measures: • Oversight and management of the ERA program has been transferred to the OMES Grant Management Office (OMES-GMO) which has staff with several years of grant experience. OMES-GMO has recently hired additional staff, and the two staff members dedicated to the management of the ERA program have 20+ years of combined federal grant specific experience. • To ensure that the subrecipient agreement includes all the required terms under the ERA Program and that the agreement does not expire, OMES-GMO and the Communities of Foundation of Oklahoma (CFO) have recently executed a Subrecipient Grant Agreement Amendment that details the responsibilities of OMES to monitor CFO and the duties and processes that CFO must follow in regard to ERA Program, including detailed cash management policies. See Attached – Grant Agreement Amendment. • OMES-GMO required the return of the remaining ERA2 Program funds from CFO to ensure proper oversight and review of ERA expenditures is performed. • OMES-GMO has a multi-level system of internal controls for grant management and oversight that includes routine monitoring, desk review, and site visits for all projects and associated project/administrative expenditures to ensure allowability, accuracy, and assist in the detection of fraud. For example, OMESGMO’s process for disbursing funds to a subrecipient requires a written request from the subrecipient with supporting documentation, then OMES-GMO assigns a staff lead and secondary grant analyst to perform a primary and secondary review for compliance and to require additional supporting documentation if needed to approve the request. Once those reviews are completed and approved by the OMES-GMO staff, the Director of the OMESGMO must approve the request before it is sent to the OMES Finance Division, who will then verify the calculated amount(s) before completing the disbursement to the subrecipient. These internal controls and policies have been implemented for the management and oversight of the ERA Program and provide a multi-layer review that will prevent fraud and risk factors applicable to the ERA program. Additionally, the OMES-GMO staff assigned to the ERA program have the training and knowledge to ensure compliance with the Federal grant requirements. • Depending on the level of risk, OMES-GMO conducts monthly, bi-weekly or weekly meetings with each subrecipient to monitor the progress of projects and address any issues or changes that might impact the project. For the ERA Program, OMES-GMO conducts biweekly monitoring meetings with CFO and is currently reviewing documentation provided by CFO to ensure all current ERA projects are eligible under the ERA guidelines and that CFO is exercising the proper oversight over their subrecipients. OMES-GMO will continue with their current ERA monitoring steps and internal controls and will work with CFO to ensure ERA program funds are spent in accordance with ERA program guidelines and state and federal regulations. Anticipated Completion Date Ongoing throughout the life of the grant Responsible Contact Person Brandy Manek

Finding Number 2023-026 Subject Heading (Financial) or AL no. and program name (Federal) ALN: 21.019 Federal Program name: Emergency Rental Assistance Program (ERA) Planned Corrective Action Oklahoma Office of Management and Enterprise Services (OMES) acknowledges the Oklahoma State Auditor and Inspector Office’s (SAI) findings that OMES did not implement the proper internal controls and oversight of the ERA Program during FY2023. However, OMES has taken steps to correct these findings and follow the recommendations set forth by SAI. Beginning with FY2025, OMES has taken the following measures: • Oversight and management of the ERA program has been transferred to the OMES Grant Management Office (OMES-GMO) which has staff with several years of grant experience. OMES-GMO has recently hired additional staff, and the two staff members dedicated to the management of the ERA program have 20+ years of combined federal grant specific experience. • To ensure that the subrecipient agreement includes all the required terms under the ERA Program and that the agreement does not expire, OMES-GMO and the Communities of Foundation of Oklahoma (CFO) have recently executed a Subrecipient Grant Agreement Amendment that details the responsibilities of OMES to monitor CFO and the duties and processes that CFO must follow in regard to ERA Program, including detailed cash management policies. See Attached – Grant Agreement Amendment. (See page 15 of attached Grant Agreement.) • OMES-GMO required the return of the remaining ERA2 Program funds from CFO to ensure proper oversight and review of ERA expenditures is performed. • OMES-GMO has a multi-level system of internal controls for grant management and oversight that includes routine monitoring, desk review, and site visits for all projects and associated project/administrative expenditures to ensure allowability, accuracy, and assist in the detection of fraud. For example, OMES-GMO’s process for disbursing funds to a subrecipient requires a written request from the subrecipient with supporting documentation, then OMES-GMO assigns a staff lead and secondary grant analyst to perform a primary and secondary review for compliance and to require additional supporting documentation if needed to approve the request. Once those reviews are completed and approved by the OMES-GMO staff, the Director of the OMESGMO must approve the request before it is sent to the OMES Finance Division, who will then verify the calculated amount(s) before completing the disbursement to the subrecipient. These internal controls and policies have been implemented for the management and oversight of the ERA Program and provide a multi-layer review that will prevent fraud and risk factors applicable to the ERA program. Additionally, the OMES- GMO staff assigned to the ERA program have the training and knowledge to ensure compliance with the Federal grant requirements. • Risk assessments have been obtained and are attached. • Depending on the level of risk, OMES-GMO conducts monthly, bi-weekly or weekly meetings with each subrecipient to monitor the progress of projects and address any issues or changes that might impact the project. For the ERA Program, OMES-GMO conducts biweekly monitoring meetings with CFO and is currently reviewing documentation provided by CFO to ensure all current ERA projects are eligible under the ERA guidelines and that CFO is exercising the proper oversight over their subrecipients. • OMES-GMO will continue with their current ERA monitoring steps and internal controls and will work with CFO to ensure ERA program funds are spent in accordance with ERA program guidelines and state and federal regulations. Anticipated Completion Date Ongoing throughout the life of the grant Responsible Contact Person Brandy Manek

Finding Number 2023-062 Subject Heading (Financial) or AL no. and program name (Federal) ALN: 21.019 Federal Program name: Coronavirus Relief Fund (CRF) Planned Corrective Action The State agrees with this finding. The State is attaching OIG Financial Progress Reports. Cycle 11 accounts for the full and final amount of the grant. The State of Oklahoma agrees and has strengthened their controls over financial reporting of federal grant awards to ensure the amounts are accurately reported. Also, the State will ensure quarterly Financial Progress Reports are properly retained for the appropriate length of time by abiding by state and federal guidelines for the retention of documentation. Within OMES, oversight and management of Federal grants has been transferred to the OMES Grant Management Office (OMES-GMO) which is staffed with individuals with several years of grant experience. OMES-GMO has a multilevel system of internal controls for grant management and oversight that includes routine monitoring, desk review, and site visits for all projects and associated project/administrative expenditures to ensure allowability, accuracy, and assist in the detection of fraud. Anticipated Completion Date September 2022 Responsible Contact Person Brandy Manek

Finding Number 2023-035 Subject Heading (Financial) or AL no. and program name (Federal) #17.225 Unemployment Insurance Planned Corrective Action The agency concurs with the findings and agrees with the recommendation. The agency acknowledges our responsibility for program integrity and proper controls for the RESEA program. As we referenced in our response last year, the agency has undertaken modernization efforts to provide better solutions for the RESEA program. EmployOklahoma is the first result of this effort in the workforce employment area and it launched in January 2025 as the replacement for OKJM. The majority of the findings above were related to cases pulled for the period between July 2022 and December 2022; there was improvement in the period from January 2023 to June 2023. We anticipate continued progress and improvement going forward, but there will continue to be elevated risk for inaccuracies until the agency’s modernization efforts are successful in implementing solutions to address both the case management and data reporting requirements needed to fully resolve these findings. Anticipated Completion Date Ongoing until modernization of RESEA tools is complete Responsible Contact Person Tammy Wood, RESEA/TAA Program Manager

Finding Number 2023-031 Subject Heading (Financial) or AL no. and program name (Federal) #17.225 Unemployment Insurance Planned Corrective Action OESC concurs with the audit finding and agrees with the recommendation. The agency also acknowledges the importance of data integrity in submitting the ETA 9050, ETA 9052 and ETA 9055 reports. Programming was completed in June 2023 to retain backup of the detailed data at the time each report is run. As part of OESC’s technology modernization efforts, technical resources continue to review reporting requirements for all regulatory reports and validate the accuracy of programming that supports such reporting. DOL completed a Data Validation monitoring of OESC in May 2024, and the DOL reviewers shared favorable comments regarding OESC’s modernization efforts, and the agency was able to satisfy DOL with regard to the area of concern and finding identified in their review. OESC leadership expects to address the underlying causes for this finding as part of our modernization efforts. Anticipated Completion Date Programming completed in June 2023 to retain backup data; data validation for regulatory reports is ongoing as part of OESC technology modernization efforts. Responsible Contact Person Michelle Britten, Chief Administrative Officer

VIEWS OF RESPONSIBLE OFFICIALS As part of the digitization project process, ADSEF seeks to standardize procedures and ensure the organization and proper location of documents within the files. For this Digitalization project we have available matching funds of approximately 7 million dollars IMPLEMENTATION DATE December 2027 RESPONSIBLE PERSON Administration for Socioeconomic Development of the Family (ADSEF, by its Spanish Acronym)

VIEWS OF RESPONSIBLE OFFICIALS It is recommended, among other things, to establish internal controls that provide certainty, effective monitoring, data validation, and accountability for those employees who execute the reporting processes. To this end, the personnel responsible will be convened and written processes will be issued to expedite the information requests and ensure their rapid submission. This will be in accordance with both state and federal regulations. Once the agreements are finalized, they will be submitted to the auditing firm. IMPLEMENTATION DATE During Fiscal Year 2025-2026. RESPONSIBLE PERSON Administration for Socioeconomic Development of the Family (ADSEF, by its Spanish Acronym)

VIEWS OF RESPONSIBLE OFFICIALS Review the accounting system to ensure consistency with SF– 425 reporting. Establish a protocol for the review and approval of financial reports. Designate a financial compliance officer to validate reports prior to submission. IMPLEMENTATION DATE During Fiscal Year 2025-2026. RESPONSIBLE PERSON Administration for Families and Children (ADFAN, by the Spanish Acronym)

VIEWS OF RESPONSIBLE OFFICIALS ADSEF has controls and procedural manuals related to data collection. As part of the digitization project process, ADSEF seeks to standardize procedures and ensure the organization and proper location of documents within the files. Annexes IMPLEMENTATION DATE Up to Date RESPONSIBLE PERSON Administration for Socioeconomic Development of the Family (ADSEF, by its Spanish Acronym) AUDITORS’ COMMENT ADSEF did not provide us with a manual describing the data collection process as requested during the auditing procedures. An unsigned and undated Manual was attached to the Corrective Action Plan. Also, ADSEF was required to provide us with the corresponding participant worksheet appendix and the physical file to corroborate the information included in the report. ADSEF provided us with evidence of the hand-completed forms; however, we were not provided with the physical files to validate the information included in each document. This represents a scope limitation.

VIEWS OF RESPONSIBLE OFFICIALS It is recommended, among other things, to establish internal controls that provide certainty, effective monitoring, data validation, and accountability for those employees who execute the reporting processes. To this end, the personnel responsible will be convened and written processes will be issued to expedite the information requests and ensure their rapid submission. This will be in accordance with both state and federal regulations. Once the agreements are finalized, they will be submitted to the auditing firm. IMPLEMENTATION DATE During Fiscal Year 2025-2026. RESPONSIBLE PERSON Administration for Socioeconomic Development of the Family (ADSEF, by its Spanish Acronym)