Finding 1224320 (2025-002)

Federal Agency: U.S. Department of Agriculture Federal Program Name: Supplemental Nutrition Assistance Program (SNAP) Assistance Listing Number: 10.561 Federal Award Identification Number and Year: 212MN101S2514; 212MN101S2520; 212MN127Q7503 - 2025 Pass-Through Agency: Minnesota Department of Agriculture Award Period: January 1, 2025 – December 31, 2025 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matter Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: During our testing, we noted the following instance of noncompliance in the sample of sixty case files tested: •One MAXIS case file did not have a re-determination of eligibility performed within the 12-month period. •One MAXIS case file did not have documentation of income verification. Questioned costs: None Context: The State of Minnesota Department of Agriculture contracts with county social services departments to perform the “intake function” (meeting with the social services client to determine income and categorical eligibility), while the State maintains the MAXIS system, which determine eligibility. Participants receive benefit payments from the state. The eligible individuals consist of one population, and a total of 60 enrolled persons were selected. The sample sizes were based on guidance from Chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Of the 60 selections, errors were noted in two of the cases (see condition section above for more detail). Cause: Instances of non-compliance were the result of: •Agency entry error in MAXIS system when converting an MFIP case to SNAP, resulting in an incorrect recertification period to be established for SNAP greater than 12 months from the previous certification date. •Agency failure to request mandatory verification of reported income/change to income in addition to a failure to update MAXIS system with reported income change. Effect: Although not found during our testing, benefits paid for participants in the program by the State of Minnesota may have paid for ineligible participants or paid the incorrect amount. Repeat Finding: Yes, 2024-002. Recommendation: We recommend the County strengthen internal controls over inputs used to determine eligibility to ensure they are correctly entered and the information required by the contract is retained in the County’s records. Views of responsible officials: Hennepin County has reviewed and agrees with the finding and recommendation.