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Finding 2024-002: Youth Activities Earmarking Requirement Federal Program(s) Information Federal Agency: U.S. Department of Labor Cluster: WIOA Cluster Award Name: WIOA Youth Activities Assistance Listing Number: 17.259 Award Year: 2023 Compliance Requirement: Earmarking Type of Finding Other Matter Criteria or Specific Requirement The Workforce Innovation and Opportunity Act (WIOA) Cluster requires that not less than 20% of youth activity funds allocated to a local area, except for administrative expenditures, must be used to provide paid and unpaid work experiences (20 CFR § 681.590). Condition and Context For the FY23 award, the Organization expended 18% of youth activity funds on paid and unpaid work experiences, which is below the required 20% earmarking threshold. Cause The underutilization of work experience funds was primarily due to challenges with vendors during the award period. After the longstanding vendor ended programming halfway through the contract, there was an 8-month gap before new vendors were in place. Of the new vendors: • One failed to report on the work experience component in a manner consistent with state expectations and WIOA regulations. • A second vendor experienced delays in expending work experience funds due to the timing of the program. • A third vendor significantly underperformed, further impacting the Organization’s ability to fully expend the required funds. Effect or Potential Effect As a result, the Organization did not meet the minimum earmarking requirement for youth work experience expenditures under the WIOA Cluster for the FY23 award. The Massachusetts Department of Career Services, the cognizant agency for these funds, was notified and worked with the Organization to ensure corrective action and compliance in the future. Questioned Costs None reported. Prior Year Finding No Recommendation No formal corrective action is recommended in this finding as the matter has already been addressed with the cognizant agency. However, we encourage the Organization to continue to monitor vendor performance and reporting. Views of Responsible Officials See corrective action plan included herein.