Finding 15787 (2022-002)

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Requirement
L
Questioned Costs
-
Year
2022
Accepted
2023-05-29
Audit: 18903
Organization: City of Biddeford (ME)

AI Summary

  • Core Issue: The first quarter Project and Expenditure Report did not match the City’s accounting records.
  • Impacted Requirements: Accurate reporting is essential for compliance with the Department of Treasury's guidelines.
  • Recommended Follow-Up: Establish controls to ensure that all reports are filed accurately to protect future grant funding.

Finding Text

2022-002 ? U.S. Department of Treasury, For the Period July 1, 2021 through June 30, 2022, Assistance Listing #21.027 American Rescue Plan Act Statement of Condition: The 2022 first quarter Project and Expenditure Report activity did not agree with the City?s accounting records. Criteria: Filling accurate Project and Expenditure Reports is required to ensure the Department of Treasury has accurate financial information. Cause: Errors caused activity to be incorrectly reported. Effect: If grant information is not reported accurately to the federal oversight agency it could jeopardize future grant funding. Recommendation: We recommend implementing controls to ensure required reports are filed accurately. Questioned Costs: None

Corrective Action Plan

Management Response/Corrective Action Plan: When the City originally received the assistance from the American Rescue Plan Act, they intended to use part of that money to fund bonus pay to municipal workers who worked during the COVID crisis. Rather than only giving bonuses to public safety workers, Council voted that it was appropriate to compensate any employee who worked during a certain period of time out of City general funds. However, prior to the first report coming due, the guidelines were updated to include the standard allowance of up to $10 million of the allocation as Revenue Replacement. Revenue Replacement may fund any general government service, including salaries and fringe benefits, with only a few exceptions for debt service and pension contributions. Management elected at this time to elect to use the standard allowance. As noted above, management had already determined that they would expend ARPA funds for public safety workers (i.e., police and fire, and certain clerical staff who came back to work in person prior to the emergency being lifted), and these salaries and benefits were included in the Revenue Replacement on the March, 2022 report. It was not until June 21, 2022 that management transferred the bonus pay for the remaining employees; therefore, management did not consider these funds obligated or expended to the grant until they were transferred.

Categories

Internal Control / Segregation of Duties

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
21.027 American Rescue Plan Act - Covid $2.22M
84.425 Elementary and Secondary School Emergency Relief #3 - Covid $1.21M
10.555 National School Lunch Program $1.17M
84.010 Title Ia, Disadvantaged $887,776
84.027 Local Entitlement $633,105
20.106 Airport Improvement Program $590,926
10.553 National School Lunch Program - Breakfast Program $399,286
14.905 Safe Homes/lead Hazzard $376,875
84.425 Elementary and Secondary School Emergency Relief #1 - Covid $343,050
14.218 Community Development Block Grant - Entitlement $147,785
84.027 Local Entitlement - Arp - Covid $133,239
84.048 Career and Technical Education - Perkins Alignment Grant $96,258
14.905 Lead Hazard Reduction Grant Program $90,975
10.559 Summer Food Service Program $88,619
84.002 Adult Basic Education $82,423
84.367 Title Iia - Supporting Effective Instruction $81,597
84.425 Elementary and Secondary School Emergency Relief #2 - Covid $76,569
84.010 Title Ia, Reallocation $67,056
84.425 Arp Homeless Children and Youth I - Covid $60,452
10.555 Food Donation Program $53,094
10.560 State Administrative Expenses for Child Nutrition: Supply Chain Assistance $44,239
10.555 Child Nutrition Emergency Fund $39,067
16.738 Byrne Justice Assistance Grant - 2020 $33,827
10.582 Fresh Fruit and Vegetable Program $29,799
84.365 Title III Esl $29,775
10.555 After School Program $21,989
84.173 Preschool $18,851
84.173 Preschool - Arp - Covid $18,397
84.267 21st Century $18,359
16.738 Byrne Justice Assistance Grant - 2019 $17,690
20.106 Airport Coronavirus Relief Grant Program - Covid $13,000
16.034 Corona Virus Emergency Supplement - Covid $12,005
20.600 2022 Speed Enforcement $6,805
10.558 Child and Adult Care Food Program $3,646
10.649 Pandemic Ebt Administrative Costs: Snap $3,070
84.424 Title IV - Student Support and Academic Enrichment $3,046
14.228 Neighborhood Stabilization Program $1,268
20.616 2022 Dre/forensic Phlebotomy Training $1,265