Finding 369083 (2023-001)

- Repeat Finding
Requirement
G
Questioned Costs
-
Year
2023
Accepted
2024-02-14
Audit: 290474
Organization: Easter Seals Serving Dc/md/va (MD)
Auditor: Aprio LLP

AI Summary

  • Core Issue: The Organization failed to meet the 20% non-federal matching requirement for the Head Start program due to reduced volunteer activity linked to COVID-19.
  • Impacted Requirements: This violation affects compliance with the grant agreement and matching criteria, marking it as a repeat finding.
  • Recommended Follow-Up: Ensure compliance with matching requirements annually or obtain a waiver from the awarding agency.

Finding Text

Finding 2023-001: Reportable Finding - Failure to Meet Matching Requirement Program name: Head Start (Cluster) Assistance Listing: 93.600 Federal awarding agency: United States Department of Health and Human Services Compliance requirement: Matching, level of effort, earmarking Criteria: The grant agreement (03CH010635-05-00 and 03CH012317-01-00) for Head Start requires a non-federal matching of 20% unless a waiver is approved by the agency. Condition: As previously reported at 2022-04, the Organization did not meet the 20% non-federal match requirement for the year ended August 31, 2023, which includes the budget periods from August 1, 2022 through July 31, 2023 and August 1, 2023 through July 31, 2024. Context: It was determined that the matching requirement was not met due to not enough volunteer activity as a result of the COVID-19 pandemic. The Organization has requested a waiver from the agency. Cause: The Organization was not able to meet the non-federal matching contributions due to health department requirements to shut-down the Child Development Centers due to the COVID-19 pandemic. Due to the closures of the centers, there were fewer volunteer hours which the Organization uses to meet the matching requirement. Effect: The Organization is in violation of the matching requirement stipulated in the award agreement. Repeat finding: This is a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Recommendation: We recommend that the Organization ensure that the non-federal matching requirements for each federal award be met every fiscal year or obtain a waiver. Management’s response and corrective action plan (unaudited): See corrective action plan.

Corrective Action Plan

Based on our grant agreement with Head Start, Easter Seals DC | MD | VA is required to provide a 20% contribution of total project costs for each annual budget period, unless a waiver has been requested and approved; any combination of actual cash expended, or in-kind contributions, may be used to meet the matching requirement. Our organization met the 20% non-federal match requirement for the latest program year (Year 2) for our Early Head Start Program in Washington DC. However, we did not meet the match requirement for Year 5 of our Prince George County program. The mandatory annual waivers associated with our organization’s 20% non-federal share matching contribution requirement for the first four years (2019 - 2022) of the individual award periods ended July 31 of our Prince George’s County Head Start Program grant agreement have been submitted. Likewise, the waiver request for the first year (2022) of the individual award period ended June 30, 2022, for our Washington, DC Head Start Program grant agreement has also been submitted. Per Section 640(b)(1)(5) of the Head Start Act, a waiver request for Year 5 (2023) was submitted alongside the original budget narrative. While the budget was approved, we were notified after the program year ended that a standalone/separate waiver request for Year 5 was required. The outstanding waiver requests remain under review by representatives of The Administration of Families and Children, the agency that oversees the Office of Head Start program. We have maintained a constant dialogue with the Office of Head Start, which administers grant funding and oversight, but have yet to receive formal approval for any of the outstanding waiver submissions. However, we believe that amended waiver requests will be required for some of the program years in which we did not meet our 20% non-federal contribution match in Prince George’s County. In December 2023, we provided the Office of Head Start with additional details related to the organization’s annual expenditures, cash receipts, and non-federal share obligations for the first five years of the Prince George’s County grants. We anticipate that final responses to all five required waiver requests our Prince George’s County Program will be obtained no later than the end of the current grant year (July 31, 2024). We expect the outstanding waiver request for Year 1 of our Washington DC program will be considered and approved by the end of the current grant year (July 31, 2024).

Categories

Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 369084 2023-002
    Significant Deficiency
  • 945525 2023-001
    - Repeat
  • 945526 2023-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
17.805 Homeless Veterans Reintegration Project $638,962
93.434 Every Student Succeeds Act/preschool Development Grants $632,000
93.600 Head Start $196,076
93.498 Provider Relief Fund $160,378
93.575 Child Care and Development Block Grant $89,592
21.027 Coronavirus State and Local Fiscal Recovery Funds $30,000
93.048 Special Programs for the Aging_title Iv_and Title Ii_discretionary Projects $12,917
14.218 Community Development Block Grants/entitlement Grants $0