Finding Text
Finding Reference 2023-004
Federal Agency: U.S. Department of Housing and Urban Development
Pass-Through Agency: P.R. Department of Housing
Program: Community Development Block Grant/State’s Program and Non-Entitlement Grants in Hawaii (Assistance Listing No. 14.228)
Compliance Requirement: Reporting – Performance Reporting (L)
Type of Finding: Significant Deficiency (SD), Instance of Noncompliance (NC)
Statement of Condition In our reporting test, we found that the Municipality did not submit the reports corresponding to audit year in the required time frame:
• The first quarter (July-September 2022) and the second quarter (October-December 2022) were submitted on March 3, 2023.
• The third quarter (January-March 2023) was submitted to May 24, 2023.
• The fourth quarter (April-June 2023) was submitted to August 31, 2023.
Criteria Based on the CDBG agreements, the Municipality must submit to the Department of Housing reports on records, collections, and disbursements of Program Income on an annual and quarterly basis. Including the progress of the projects developed with the CDBG program. In addition, the Municipality will submit all the reports required by the Agency. Failure to comply with this provision will be just cause for the Department to stop the fund requisition process.
§ 200.332 Requirements for pass-through entities. (1) All requirements imposed by the pass-through entity on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations and the terms and conditions of the Federal award. (2) Any additional requirements that the pass-through entity imposes on the subrecipient in order for the pass-through entity to meet its own responsibility to the Federal awarding agency including identification of any required financial and performance reports.
Additionally, in OCAM Memorandum Circular 2002-15 of July 17, 2002, it is established that quarterly reports must be submitted within the following 40 days after the expiration date of the quarter.
Cause of Condition The personal in charge of the program did not comply with the deadlines for the quarterly reports. Additionally, the program does not have adequate monitoring of the activity and the reports, which were delivered late.
Effect of Condition The program is not in compliance with the Reporting Requirements.
Recommendation We recommend that the Municipality maintain constant monitoring and updating to achieve better control of the program. The reports must be presented as established in the agreement and guidelines of the Department of Housing. This will ensure compliance with reporting requirements under the Community Development Block Grants/State’s Program and Non-entitlement Grant in Hawaii agreement.
Questioned Cost None
Prior Year Finding No
Views of Responsible Officials and Planned Corrective Action The Program Director is aware about the compliance requirement. We gave instructions to the Program Director to maintain a dateline control sheet to ascertain that required reports were submitted within the due date.
Implementation Date: March 21, 2024
Responsible Person: Mr. Hector R. Sanjurjo Rodríguez
Federal Programs Director