Finding 1175149 (2025-005)

Federal Agency: U.S. Department of Transportation Federal Program Name: Airport Improvement Program Assistance Listing Number: 20.106 Federal Award Identification Number and Year: Multiple Award Period: 8/23/2020 –1/28/2029 Type of Finding: • Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or specific requirement: According to §200.303 Internal controls of 2 CFR Part 200, the recipient and subrecipient must establish, document, and maintain effective internal control over the federal award that provides reasonable assurance that the recipient or subrecipient is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. According to the Federal Aviation Administration's Advisory Circular 150-1500-19D, Guide for Airport Financial Reports Filed by Airport Sponsors, Financial Reports 5100-126 & 5100-127 "are due within 120 days of the end of the airport's fiscal year. A sponsor may request an automatic 60-day extension on the website. An airport that cannot file within the 60-day expensive should send a written explanation to Airport Compliance and Management Analysis" of the FAA. Condition: During our testing, we noted the City did not have adequate internal controls designed to ensure timely report submission. Management 's Progress for Repeat Findings: This is a repeated and modified finding. While the City has improved its efforts, there are still opportunities for improvement to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements as well as compliance with City policy. Questioned costs: None Context: During our testing, it was noted that two of the six financial reports were not submitted timely. Form 5100-126 and Form 5100-127 were submitted on 02/26/2025 and 02/28/2025, respectively. These submissions occurred 61 and 63 days beyond the prescribed filing deadline of 180-days following the fiscal year end. Cause: Management oversight. The City did not submit the performance report by the due date. Effect: The auditor noted an instance of noncompliance. Noncompliance results in untimely submission of information to the federal agency. Recommendation: We recommend the City establish a reporting calendar and perform periodic reviews of the completeness, accuracy and adherence to the reporting calendar. Management Response: The City concurs with the finding. Beginning in December 2025, the Aviation Revenue and Finance Officer has implemented an internal control to strengthen compliance with federal reporting requirements. A centralized spreadsheet has been created to track all required financial report deadlines, including FAA Forms 5100-126 and 5100-127. This spreadsheet identifies the due dates, responsible personnel, and submission status to help ensure reports are prepared, reviewed, and submitted timely in accordance with applicable federal regulations. The Aviation Revenue and Finance Officer will also perform periodic reviews of the reporting calendar to monitor completeness, accuracy, and compliance to required deadlines. Timeline and Responsible Position: June 2026 – Aviation Department Revenue and Finance Officer