FAC Explorer

Finding 1169177 (2025-001)

Material Weakness Repeat Finding
Requirement
N
Questioned Costs
-
Year
2025
Accepted
2026-01-15
Audit: 382059
Organization: City of Chattanooga, Tennessee (TN)
Auditor: HENDERSON HUTCHERSON & MCCULLOUGH PLLC

AI Summary

  • Core Issue: The City failed to report over $2 million in expenditures for federal grants, indicating a significant deficiency in internal controls.
  • Impacted Requirements: Compliance with federal guidelines for managing and reporting expenditures under the Clean Water State Revolving Loan Program and Brownsfield Assessment and Cleanup Grant.
  • Recommended Follow-Up: The City should accurately record and reconcile current year expenditures to strengthen internal controls over federal and state awards.

Finding Text

Schedule of Federal Expenditures Assistance Listing Titles: Clean Water State Revolving Loan Program and Brownsfield Assessment and Cleanup Grant Assistance Listing Numbers: 66.458 and 66.818 Federal Award Year: 2023-2024 Federal Agency: U.S. Environmental Protection Agency Type of Finding: Significant deficiency Questioned Costs: $2,095,121 Condition: The City missed prior year expenditures in the amount of $1,231,257 and $863,864 for the Clean Water State Revolving Loan Program and Brownsfield Assessment and Cleanup Grant, respectively. Criteria: Per compliance supplement Part 6, management should design control activities, design activities for information systems, and implement controls over the Schedule of Federal and State Awards. Cause: The City lacks sufficient enough internal controls concerned with the Schedule of Federal and State Awards to ensure that all expenditures are properly reported for each grant. Effect: When there are not sufficient internal controls in place, there is a risk that the Schedule of Federal and State Awards is not accurately recorded. Recommendation: The City needs to record current year expenditures on the Schedule of Federal and State Awards and reconcile them for better internal controls. Management Response: See management’s corrective action plan.

Corrective Action Plan

The City will implement procedures to ensure that all current year expenditures related to federal awards are accurately recorded on the SEFA and properly reconciled to the General Ledger.

Categories

Significant Deficiency Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties

Other Findings in this Audit

  • 1169175 2025-001
    Material Weakness Repeat
  • 1169176 2025-001
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
66.458 CLEAN WATER STATE REVOLVING FUND $3.07M
93.600 HEAD START $2.41M
14.218 COMMUNITY DEVELOPMENT BLOCK GRANTS/ENTITLEMENT GRANTS $2.16M
66.818 BROWNFIELDS MULTIPURPOSE, ASSESSMENT, REVOLVING LOAN FUND, AND CLEANUP COOPERATIVE AGREEMENTS $1.44M
21.027 CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS $903,773
10.727 INFLATION REDUCTION ACT URBAN & COMMUNITY FORESTRY PROGRAM $781,544
14.239 HOME INVESTMENT PARTNERSHIPS PROGRAM $622,325
93.569 COMMUNITY SERVICES BLOCK GRANT $594,781
94.011 AMERICORPS SENIORS FOSTER GRANDPARENT PROGRAM (FGP) 94.011 $541,983
16.710 PUBLIC SAFETY PARTNERSHIP AND COMMUNITY POLICING GRANTS $482,545
20.941 STRENGTHENING MOBILITY AND REVOLUTIONIZING TRANSPORTATION (SMART) GRANTS PROGRAM $468,600
45.310 GRANTS TO STATES $430,500
66.001 AIR POLLUTION CONTROL PROGRAM SUPPORT $385,387
14.231 EMERGENCY SOLUTIONS GRANT PROGRAM $286,034
20.205 HIGHWAY PLANNING AND CONSTRUCTION $234,523
20.607 ALCOHOL OPEN CONTAINER REQUIREMENTS $224,512
20.326 FEDERAL-STATE PARTNERSHIP FOR INTERCITY PASSENGER RAIL $178,027
20.939 SAFE STREETS AND ROADS FOR ALL $149,343
97.044 ASSISTANCE TO FIREFIGHTERS GRANT $149,040
11.040 DISTRESSED AREA RECOMPETE PILOT PROGRAM $143,000
16.575 CRIME VICTIM ASSISTANCE $119,089
93.136 INJURY PREVENTION AND CONTROL RESEARCH AND STATE AND COMMUNITY BASED PROGRAMS $108,151
14.267 CONTINUUM OF CARE PROGRAM $102,210
15.904 HISTORIC PRESERVATION FUND GRANTS-IN-AID $53,000
97.067 HOMELAND SECURITY GRANT PROGRAM $40,584
93.137 COMMUNITY PROGRAMS TO IMPROVE MINORITY HEALTH $24,303
21.016 EQUITABLE SHARING $23,448
93.568 LOW-INCOME HOME ENERGY ASSISTANCE $17,931
66.034 SURVEYS, STUDIES, RESEARCH, INVESTIGATIONS, DEMONSTRATIONS, AND SPECIAL PURPOSE ACTIVITIES RELATING TO THE CLEAN AIR ACT $14,368
20.703 INTERAGENCY HAZARDOUS MATERIALS PUBLIC SECTOR TRAINING AND PLANNING GRANTS $11,949
16.738 EDWARD BYRNE MEMORIAL JUSTICE ASSISTANCE GRANT PROGRAM $6,759
16.582 CRIME VICTIM ASSISTANCE/DISCRETIONARY GRANTS $4,801