Assistance Listing Number 84.425 Education Stabilization Fund Department of Education Passed Through North Dakota Department of Public Instruction Passed Through Turtle Mountain Band of Chippewa Indians Equipment/Real Property Management Criteria 2 CFR sections 200.313(c) and (e) includes a requirement for the non-federal entity to not encumber the equipment without prior approval of the federal awarding agency. 2 CFR section 200.311 includes a requirement for the non-federal entity, with prior approval by the ED or passthrough entity, may also use ESF funds to purchase real property, perform construction or minor remodeling, and for improvements to land, buildings, or equipment. Condition The District did not obtain prior approval for equipment acquisition or construction projects. Context Per discussion with the District staff and review of program expenditures, there were 19 capital asset acquisitions during the year, we tested all of them for prior state approval. One purchase was approved by the state after the purchase was made. Seven purchases were made without prior state approval. Cause The District did not properly submit for prior approval for equipment acquisition or construction until after the expenditure had been incurred and in some instances there were no submissions for prior approval. Effect The District may have purchased capital items that were not allowed by the State. Questioned Costs Undeterminable. Repeat Finding See prior year finding 2023-004. Recommendation We recommend the District to review all compliance requirements of federal programs to ensure they have procedures to ensure compliance with those requirements and for the requests for acquisition to be made timely and for the appropriate expenditure amount. Management’s Response See corrective action plan.
Assistance Listing Number 84.425 Education Stabilization Fund Department of Education Passed Through North Dakota Department of Public Instruction Passed Through Turtle Mountain Band of Chippewa Indians Equipment/Real Property Management Criteria 2 CFR sections 200.313(c) and (e) includes a requirement for the non-federal entity to not encumber the equipment without prior approval of the federal awarding agency. 2 CFR section 200.311 includes a requirement for the non-federal entity, with prior approval by the ED or passthrough entity, may also use ESF funds to purchase real property, perform construction or minor remodeling, and for improvements to land, buildings, or equipment. Condition The District did not obtain prior approval for equipment acquisition or construction projects. Context Per discussion with the District staff and review of program expenditures, there were 19 capital asset acquisitions during the year, we tested all of them for prior state approval. One purchase was approved by the state after the purchase was made. Seven purchases were made without prior state approval. Cause The District did not properly submit for prior approval for equipment acquisition or construction until after the expenditure had been incurred and in some instances there were no submissions for prior approval. Effect The District may have purchased capital items that were not allowed by the State. Questioned Costs Undeterminable. Repeat Finding See prior year finding 2023-004. Recommendation We recommend the District to review all compliance requirements of federal programs to ensure they have procedures to ensure compliance with those requirements and for the requests for acquisition to be made timely and for the appropriate expenditure amount. Management’s Response See corrective action plan.
Assistance Listing Number 84.425 Education Stabilization Fund Department of Education Passed Through North Dakota Department of Public Instruction Passed Through Turtle Mountain Band of Chippewa Indians Equipment/Real Property Management Criteria 2 CFR sections 200.313(c) and (e) includes a requirement for the non-federal entity to not encumber the equipment without prior approval of the federal awarding agency. 2 CFR section 200.311 includes a requirement for the non-federal entity, with prior approval by the ED or passthrough entity, may also use ESF funds to purchase real property, perform construction or minor remodeling, and for improvements to land, buildings, or equipment. Condition The District did not obtain prior approval for equipment acquisition or construction projects. Context Per discussion with the District staff and review of program expenditures, there were 19 capital asset acquisitions during the year, we tested all of them for prior state approval. One purchase was approved by the state after the purchase was made. Seven purchases were made without prior state approval. Cause The District did not properly submit for prior approval for equipment acquisition or construction until after the expenditure had been incurred and in some instances there were no submissions for prior approval. Effect The District may have purchased capital items that were not allowed by the State. Questioned Costs Undeterminable. Repeat Finding See prior year finding 2023-004. Recommendation We recommend the District to review all compliance requirements of federal programs to ensure they have procedures to ensure compliance with those requirements and for the requests for acquisition to be made timely and for the appropriate expenditure amount. Management’s Response See corrective action plan.
Finding No. 2024-044 Federal Awarding Agency: USDOI Impact: Material Weakness AL Number and Title: 15.605, 15.611 FWC Federal Award Number: Multiple Applicable Compliance Requirement: Equipment and Real Property Management Condition: Auditors could not obtain sufficient and appropriate evidence to verify compliance with FWC’s equipment and real property management requirements. Context: DFG is responsible for ensuring equipment, real property, and capital improvements, acquired with FWC funds, are used for an authorized purpose, sufficiently tracked, and appropriately disposed of in accordance with federal regulations. In FY 24, DFG staff did not maintain sufficient evidence to demonstrate compliance with equipment and real property management requirements. DFG equipment and real property records did not reliably catalog the universe of equipment, real property, and capital improvements funded with FWC grant monies. Equipment records were incomplete and not trackable by funding source in the accounting system. As a result, the audit was unable to determine the extent of equipment purchased with FWC funds. Real property records had not been reconciled since 2019 and could not be matched with DFG site visit logs. The audit could not identify the FWC assets to be monitored and the extent of site visits conducted during the audit period, and whether the site visits included monitoring for authorized uses. Cause: DFG management attributed the deficiencies to a lack of department-wide procedures, staff turnover, and insufficient training. Criteria: Title 2 CFR 200.303 requires the State to establish and maintain effective internal controls over the federal award that provides reasonable assurance that the State is managing the federal awards in compliance with federal statutes, regulations, and terms and conditions of the federal award. Title 2 CFR 200.311 and Title 50 CFR 80.134 requires the State to use real property for the purpose authorized in the grant for as long as it is needed for that purpose. When real property is no longer needed for the originally authorized purpose, property must be disposed of in accordance with federal requirements. Title 2 CFR 200.313 requires the State to use, manage and dispose of equipment acquired under a federal award in accordance with State laws and procedures. Such equipment must be used for the project or program for which it was acquired and for as long as needed. The State agency must maintain equipment property records, perform physical inventory of equipment, develop a control system, and perform regular maintenance of equipment. Title 50 CFR 80.133 requires the State to maintain acquired or completed capital improvements under FWC grants to ensure that each capital improvement continues to serve its authorized purpose during its useful life. Effect: The lack of department-wide procedures increases the risk that FWC funded assets are not used for authorized purposes and properly disposed of when no longer needed. Inadequate equipment tracking increases the risk of loss or theft. Further, noncompliance with federal regulations may result in the federal awarding agency imposing additional conditions or taking corrective action, including additional reporting requirements or withholding/terminating funding. Questioned Costs: Indeterminate Recommendation: DFG’s commissioner should ensure procedures are developed and training is implemented so that FWC funded equipment, real property and capital improvements are managed in compliance with federal requirements. Views of Responsible Officials: Management agrees with this finding.
Finding No. 2024-044 Federal Awarding Agency: USDOI Impact: Material Weakness AL Number and Title: 15.605, 15.611 FWC Federal Award Number: Multiple Applicable Compliance Requirement: Equipment and Real Property Management Condition: Auditors could not obtain sufficient and appropriate evidence to verify compliance with FWC’s equipment and real property management requirements. Context: DFG is responsible for ensuring equipment, real property, and capital improvements, acquired with FWC funds, are used for an authorized purpose, sufficiently tracked, and appropriately disposed of in accordance with federal regulations. In FY 24, DFG staff did not maintain sufficient evidence to demonstrate compliance with equipment and real property management requirements. DFG equipment and real property records did not reliably catalog the universe of equipment, real property, and capital improvements funded with FWC grant monies. Equipment records were incomplete and not trackable by funding source in the accounting system. As a result, the audit was unable to determine the extent of equipment purchased with FWC funds. Real property records had not been reconciled since 2019 and could not be matched with DFG site visit logs. The audit could not identify the FWC assets to be monitored and the extent of site visits conducted during the audit period, and whether the site visits included monitoring for authorized uses. Cause: DFG management attributed the deficiencies to a lack of department-wide procedures, staff turnover, and insufficient training. Criteria: Title 2 CFR 200.303 requires the State to establish and maintain effective internal controls over the federal award that provides reasonable assurance that the State is managing the federal awards in compliance with federal statutes, regulations, and terms and conditions of the federal award. Title 2 CFR 200.311 and Title 50 CFR 80.134 requires the State to use real property for the purpose authorized in the grant for as long as it is needed for that purpose. When real property is no longer needed for the originally authorized purpose, property must be disposed of in accordance with federal requirements. Title 2 CFR 200.313 requires the State to use, manage and dispose of equipment acquired under a federal award in accordance with State laws and procedures. Such equipment must be used for the project or program for which it was acquired and for as long as needed. The State agency must maintain equipment property records, perform physical inventory of equipment, develop a control system, and perform regular maintenance of equipment. Title 50 CFR 80.133 requires the State to maintain acquired or completed capital improvements under FWC grants to ensure that each capital improvement continues to serve its authorized purpose during its useful life. Effect: The lack of department-wide procedures increases the risk that FWC funded assets are not used for authorized purposes and properly disposed of when no longer needed. Inadequate equipment tracking increases the risk of loss or theft. Further, noncompliance with federal regulations may result in the federal awarding agency imposing additional conditions or taking corrective action, including additional reporting requirements or withholding/terminating funding. Questioned Costs: Indeterminate Recommendation: DFG’s commissioner should ensure procedures are developed and training is implemented so that FWC funded equipment, real property and capital improvements are managed in compliance with federal requirements. Views of Responsible Officials: Management agrees with this finding.
FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief II (ESSER II) Fund, Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Emergency Needs, and Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Learning Loss Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the classroom projector project did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of classroom projectors with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $718,634 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief II (ESSER II) Fund, Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Emergency Needs, and Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Learning Loss Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the classroom projector project did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of classroom projectors with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $718,634 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief II (ESSER II) Fund, Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Emergency Needs, and Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Learning Loss Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the classroom projector project did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of classroom projectors with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $718,634 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief II (ESSER II) Fund, Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Emergency Needs, and Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Learning Loss Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the classroom projector project did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of classroom projectors with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $718,634 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief II (ESSER II) Fund, Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Emergency Needs, and Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Learning Loss Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the classroom projector project did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of classroom projectors with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $718,634 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief II (ESSER II) Fund, Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Emergency Needs, and Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Learning Loss Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the classroom projector project did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of classroom projectors with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $718,634 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief II (ESSER II) Fund, Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Emergency Needs, and Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Learning Loss Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the classroom projector project did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of classroom projectors with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $718,634 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
2023-015 Oregon Housing and Community Services Fully implement controls to ensure subrecipients are in compliance with program requirements Federal Awarding Agency: U.S. Department of Housing and Urban Development Assistance Listing Number and Name: 14.231 Emergency Solutions Grants Program (COVID-19) Federal Award Numbers and Years: E-20-DW-41-0001, 2020 (COVID-19) Compliance Requirements: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Equipment and Real Property Management; Matching, Level of Effort, Earmarking; Procurement, Suspension, and Debarment, Special Tests and Provisions Type of Finding: Material Weakness Prior Year Findings: 2022-018, 2022-019, 2022-020, 2022-021, 2022-024 Questioned Costs: N/A Criteria: 2 CFR 200.303(a); 2 CFR 200.311; 2 CFR 200.313; 2 CFR 200.317 - .327; 24 CFR 576.100; 24 CFR 576.101(c); 24 CFR 576.102(c) The Emergency Solutions Grants (ESG/ESG-CV) program is operated by the department via pass-through funds to subrecipients. With the significant influx of pandemic relief funds, the department expanded the number of subrecipients partnered with from 17 longstanding community action agencies (CAAs) to a total of 45 CAA and non-CAA subrecipients. During fiscal year 2023, 98% of program expenditures were passed through to 40 of these subrecipients. Department management is responsible for establishing and maintaining effective internal control that provides reasonable assurance program expenditures are in compliance with the terms and conditions of the federal award. However, the significant increases to federal funding the creation and implementation of a new award system for non-CAA recipients, and the increase in the number of subrecipients, along with a period of high employee turnover led to delays in the department’s development and implementation of sufficient subrecipient monitoring processes that would meet this objective. Department management subsequently contracted with a private auditing firm to assist in the monitoring of the program activities and expenditures of funds passed through to the subrecipients to remedy the noted control weaknesses. Department staff and the private auditing firm are currently working through the monitoring backlog. However, at the time of the audit, monitoring of only 16 of the 40 subrecipients had been completed which represents 58% of the fiscal year 2023 pass-through expenditures. Additionally, the completed monitoring was only performed over fiscal year 2022 expenditures as the department works to catch up on monitoring of prior year expenditures. Incomplete monitoring could lead to program noncompliance. We recommend department management complete the review and monitoring of program funds passed through to subrecipients for compliance with all applicable program requirements.
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION COVID-19 AMERICAN RESCUE PLAN - ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND - AL NUMBER 84.425U PASS-THROUGH NUMBER 1402 AUDIT PERIOD - YEAR ENDED JUNE 30, 2023 2023-001 Equipment and Real Property / Special Test and Provisions Criteria or specific requirement: 29 CFR 5.5 (Wage Rate Requirements) requires all contractors and subcontractors performing construction contracts in excess of $2,000, financed by federal assistance funds, to pay laborers and mechanics employed by the contractor or subcontractor not less than the prevailing wage rates as determined by the Department of Labor for the locality of the project. Non-federal entities shall include in the applicable construction contracts a provision that the contractor or subcontractor comply with those requirements. Such requirements include the submission of weekly certified payrolls for each week in which any contract work is performed, to the non-federal entities. Also, property records should be maintained for real property and improvements made to real property acquired with federal awards as specified in OMB 2 CFR section 200.311. Condition: The District paid $339,299 for the installation of flooring from the Education Stabilization Fund without obtaining a written contract that included the prevailing wage rate provision, and weekly certified payrolls were not submitted to the District. Additionally, the flooring project was not recorded in the District's capital asset subsidiary ledger. Cause: Lack of internal controls and management oversight. Effect or potential effect: The District did not comply with Wage Rate Requirements. The District's capital assets subsidiary records were not accurate. Context: An examination of the only capital improvement disbursement (totaling $339,229) paid from the Education Stabilization Fund. Identification as a repeat finding: No Recommendation: The District should contact the Arkansas Division of Elementary and Secondary Education (DESE) for guidance regarding this matter and implement proper controls over program expenditures. Views of responsible officials: The district will develop a check list to be used when projects are approved. The checklist will include making sure contracts are obtained when the project is being paid from a federal fund. In addition, it will note that weekly certified payrolls are to be submitted. Additional training will be provided to our Facilities Director on the Davis-Bacon Act. The district will adjust the current procedure for identifying expenditures which need to be included on capital asset inventory.
FINDING #2023-003: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Name: Elementary and Secondary School Emergency Relief II (ESSER II) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education (ED) Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing a representative sample of ESF expenditures, we noted that the network switch purchases did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of network switches with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $208,801. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-003: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Name: Elementary and Secondary School Emergency Relief II (ESSER II) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education (ED) Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing a representative sample of ESF expenditures, we noted that the network switch purchases did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of network switches with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $208,801. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-003: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Name: Elementary and Secondary School Emergency Relief II (ESSER II) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education (ED) Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing a representative sample of ESF expenditures, we noted that the network switch purchases did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of network switches with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $208,801. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-003: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Name: Elementary and Secondary School Emergency Relief II (ESSER II) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education (ED) Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing a representative sample of ESF expenditures, we noted that the network switch purchases did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of network switches with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $208,801. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-003: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Name: Elementary and Secondary School Emergency Relief II (ESSER II) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education (ED) Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing a representative sample of ESF expenditures, we noted that the network switch purchases did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of network switches with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $208,801. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-003: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Name: Elementary and Secondary School Emergency Relief II (ESSER II) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education (ED) Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing a representative sample of ESF expenditures, we noted that the network switch purchases did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of network switches with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $208,801. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-003: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Name: Elementary and Secondary School Emergency Relief II (ESSER II) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education (ED) Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing a representative sample of ESF expenditures, we noted that the network switch purchases did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of network switches with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $208,801. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-003: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Name: Elementary and Secondary School Emergency Relief II (ESSER II) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education (ED) Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing a representative sample of ESF expenditures, we noted that the network switch purchases did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of network switches with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $208,801. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-003: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Name: Elementary and Secondary School Emergency Relief II (ESSER II) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education (ED) Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing a representative sample of ESF expenditures, we noted that the network switch purchases did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of network switches with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $208,801. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION COVID-19 AMERICAN RESCUE PLAN - ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND - AL NUMBER 84.425D AND 84.425U PASS-THROUGH NUMBER 5703 AUDIT PERIOD - YEAR ENDED JUNE 30, 2023 2023-002.Equipment and Real Property Management / Special Tests and Provisions Criteria or specific requirement: 29 CFR 5.5 (Wage Rate Requirements) requires all contractors and subcontractors performing construction contracts in excess of $2,000, financed by federal assistance funds, to pay laborers and mechanics employed by the contractor or subcontractor not less than the prevailing wage rates as determined by the Department of Labor for the locality of the project. Non-federal entities shall include in the applicable construction contracts a provision that the contractor or subcontractor comply with those requirements. Such requirements include the submission of weekly certified payrolls for each week in which any contract work is performed, to the non-federal entities. 2 CFR 200.311 requires property records be maintained for real property and improvements made to real property acquired with federal awards. Additionally, 2 CFR 200.326 and Ark. Code Ann. § 18-44-503 require a non-federal entity to obtain a performance bond for the public construction contract. Condition: The District paid $1,322,196 for a capital improvement flooring project from the Education Stabilization Fund without obtaining a performance bond and without obtaining a written contract that included the prevailing wage rate provision, and weekly certified payrolls were not submitted to the District. Additionally, the District did not record in the capital assets subsidiary records capital improvements for a HVAC system or flooring project totaling $154,377 and $1,322,196, respectively, and for equipment totaling $12,138. Cause: Lack of internal controls and management oversight. Effect or potential effect: The District did not comply with Wage Rate Requirements or Bonding Requirements. The District's capital assets subsidiary records were not accurate. Questioned costs:Context: A population of 20 payments for capital improvements and equipment totaling $1,525,445. All were examined. Identification as a repeat finding: No Recommendation: The District should contact the Arkansas Division of Elementary and Secondary Education (DESE) for guidance regarding this matter and implement proper controls over program expenditures. Views of responsible officials: The Department of Elementary and Secondary Education will be contacted regarding this matter. The district did not receive guidance from the Department about this issue other than stating that Davis-Bacon wage rules apply. Those materials will be recorded as capital assets and our new capital assets clerk will be trained on the definition and record keeping of such items. This likely occurred simply from the fact that yearly past practice for the district has been to enter the asset as one item in the asset system. Construction in progress has been used as a reconciliation item in fixed assets. There must have been some misunderstanding on this matter because the district does have a statement of coverage for the company that did this work and will provide it. However, if the format is wrong, the district will, in the future, insist that the proper format be used.
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION COVID-19 AMERICAN RESCUE PLAN - ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND - AL NUMBER 84.425D AND 84.425U PASS-THROUGH NUMBER 5703 AUDIT PERIOD - YEAR ENDED JUNE 30, 2023 2023-002.Equipment and Real Property Management / Special Tests and Provisions Criteria or specific requirement: 29 CFR 5.5 (Wage Rate Requirements) requires all contractors and subcontractors performing construction contracts in excess of $2,000, financed by federal assistance funds, to pay laborers and mechanics employed by the contractor or subcontractor not less than the prevailing wage rates as determined by the Department of Labor for the locality of the project. Non-federal entities shall include in the applicable construction contracts a provision that the contractor or subcontractor comply with those requirements. Such requirements include the submission of weekly certified payrolls for each week in which any contract work is performed, to the non-federal entities. 2 CFR 200.311 requires property records be maintained for real property and improvements made to real property acquired with federal awards. Additionally, 2 CFR 200.326 and Ark. Code Ann. § 18-44-503 require a non-federal entity to obtain a performance bond for the public construction contract. Condition: The District paid $1,322,196 for a capital improvement flooring project from the Education Stabilization Fund without obtaining a performance bond and without obtaining a written contract that included the prevailing wage rate provision, and weekly certified payrolls were not submitted to the District. Additionally, the District did not record in the capital assets subsidiary records capital improvements for a HVAC system or flooring project totaling $154,377 and $1,322,196, respectively, and for equipment totaling $12,138. Cause: Lack of internal controls and management oversight. Effect or potential effect: The District did not comply with Wage Rate Requirements or Bonding Requirements. The District's capital assets subsidiary records were not accurate. Questioned costs:Context: A population of 20 payments for capital improvements and equipment totaling $1,525,445. All were examined. Identification as a repeat finding: No Recommendation: The District should contact the Arkansas Division of Elementary and Secondary Education (DESE) for guidance regarding this matter and implement proper controls over program expenditures. Views of responsible officials: The Department of Elementary and Secondary Education will be contacted regarding this matter. The district did not receive guidance from the Department about this issue other than stating that Davis-Bacon wage rules apply. Those materials will be recorded as capital assets and our new capital assets clerk will be trained on the definition and record keeping of such items. This likely occurred simply from the fact that yearly past practice for the district has been to enter the asset as one item in the asset system. Construction in progress has been used as a reconciliation item in fixed assets. There must have been some misunderstanding on this matter because the district does have a statement of coverage for the company that did this work and will provide it. However, if the format is wrong, the district will, in the future, insist that the proper format be used.
FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief II (ESSER II) Fund, Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Emergency Needs, and Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Learning Loss Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the classroom projector project did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of classroom projectors with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $718,634 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief II (ESSER II) Fund, Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Emergency Needs, and Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Learning Loss Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the classroom projector project did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of classroom projectors with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $718,634 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief II (ESSER II) Fund, Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Emergency Needs, and Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Learning Loss Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the classroom projector project did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of classroom projectors with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $718,634 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief II (ESSER II) Fund, Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Emergency Needs, and Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Learning Loss Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the classroom projector project did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of classroom projectors with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $718,634 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief II (ESSER II) Fund, Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Emergency Needs, and Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Learning Loss Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the classroom projector project did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of classroom projectors with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $718,634 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief II (ESSER II) Fund, Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Emergency Needs, and Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Learning Loss Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the classroom projector project did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of classroom projectors with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $718,634 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief II (ESSER II) Fund, Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Emergency Needs, and Expanded Learning Opportunities (ELO) Grant: ESSER III State Reserve, Learning Loss Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the classroom projector project did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of classroom projectors with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $718,634 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
2023-015 Oregon Housing and Community Services Fully implement controls to ensure subrecipients are in compliance with program requirements Federal Awarding Agency: U.S. Department of Housing and Urban Development Assistance Listing Number and Name: 14.231 Emergency Solutions Grants Program (COVID-19) Federal Award Numbers and Years: E-20-DW-41-0001, 2020 (COVID-19) Compliance Requirements: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Equipment and Real Property Management; Matching, Level of Effort, Earmarking; Procurement, Suspension, and Debarment, Special Tests and Provisions Type of Finding: Material Weakness Prior Year Findings: 2022-018, 2022-019, 2022-020, 2022-021, 2022-024 Questioned Costs: N/A Criteria: 2 CFR 200.303(a); 2 CFR 200.311; 2 CFR 200.313; 2 CFR 200.317 - .327; 24 CFR 576.100; 24 CFR 576.101(c); 24 CFR 576.102(c) The Emergency Solutions Grants (ESG/ESG-CV) program is operated by the department via pass-through funds to subrecipients. With the significant influx of pandemic relief funds, the department expanded the number of subrecipients partnered with from 17 longstanding community action agencies (CAAs) to a total of 45 CAA and non-CAA subrecipients. During fiscal year 2023, 98% of program expenditures were passed through to 40 of these subrecipients. Department management is responsible for establishing and maintaining effective internal control that provides reasonable assurance program expenditures are in compliance with the terms and conditions of the federal award. However, the significant increases to federal funding the creation and implementation of a new award system for non-CAA recipients, and the increase in the number of subrecipients, along with a period of high employee turnover led to delays in the department’s development and implementation of sufficient subrecipient monitoring processes that would meet this objective. Department management subsequently contracted with a private auditing firm to assist in the monitoring of the program activities and expenditures of funds passed through to the subrecipients to remedy the noted control weaknesses. Department staff and the private auditing firm are currently working through the monitoring backlog. However, at the time of the audit, monitoring of only 16 of the 40 subrecipients had been completed which represents 58% of the fiscal year 2023 pass-through expenditures. Additionally, the completed monitoring was only performed over fiscal year 2022 expenditures as the department works to catch up on monitoring of prior year expenditures. Incomplete monitoring could lead to program noncompliance. We recommend department management complete the review and monitoring of program funds passed through to subrecipients for compliance with all applicable program requirements.
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION COVID-19 AMERICAN RESCUE PLAN - ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND - AL NUMBER 84.425U PASS-THROUGH NUMBER 1402 AUDIT PERIOD - YEAR ENDED JUNE 30, 2023 2023-001 Equipment and Real Property / Special Test and Provisions Criteria or specific requirement: 29 CFR 5.5 (Wage Rate Requirements) requires all contractors and subcontractors performing construction contracts in excess of $2,000, financed by federal assistance funds, to pay laborers and mechanics employed by the contractor or subcontractor not less than the prevailing wage rates as determined by the Department of Labor for the locality of the project. Non-federal entities shall include in the applicable construction contracts a provision that the contractor or subcontractor comply with those requirements. Such requirements include the submission of weekly certified payrolls for each week in which any contract work is performed, to the non-federal entities. Also, property records should be maintained for real property and improvements made to real property acquired with federal awards as specified in OMB 2 CFR section 200.311. Condition: The District paid $339,299 for the installation of flooring from the Education Stabilization Fund without obtaining a written contract that included the prevailing wage rate provision, and weekly certified payrolls were not submitted to the District. Additionally, the flooring project was not recorded in the District's capital asset subsidiary ledger. Cause: Lack of internal controls and management oversight. Effect or potential effect: The District did not comply with Wage Rate Requirements. The District's capital assets subsidiary records were not accurate. Context: An examination of the only capital improvement disbursement (totaling $339,229) paid from the Education Stabilization Fund. Identification as a repeat finding: No Recommendation: The District should contact the Arkansas Division of Elementary and Secondary Education (DESE) for guidance regarding this matter and implement proper controls over program expenditures. Views of responsible officials: The district will develop a check list to be used when projects are approved. The checklist will include making sure contracts are obtained when the project is being paid from a federal fund. In addition, it will note that weekly certified payrolls are to be submitted. Additional training will be provided to our Facilities Director on the Davis-Bacon Act. The district will adjust the current procedure for identifying expenditures which need to be included on capital asset inventory.
FINDING #2023-003: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Name: Elementary and Secondary School Emergency Relief II (ESSER II) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education (ED) Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing a representative sample of ESF expenditures, we noted that the network switch purchases did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of network switches with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $208,801. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-003: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Name: Elementary and Secondary School Emergency Relief II (ESSER II) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education (ED) Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing a representative sample of ESF expenditures, we noted that the network switch purchases did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of network switches with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $208,801. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-003: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Name: Elementary and Secondary School Emergency Relief II (ESSER II) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education (ED) Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing a representative sample of ESF expenditures, we noted that the network switch purchases did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of network switches with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $208,801. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-003: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Name: Elementary and Secondary School Emergency Relief II (ESSER II) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education (ED) Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing a representative sample of ESF expenditures, we noted that the network switch purchases did not appear to be pre-approved by the California Department of Education (CDE). Each purchase order provided for the purchase and installation of network switches with a per unit cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $208,801. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.