Finding 406006 (2023-002)

Reporting Federal Department – U.S. Department of Housing and Urban Development Federal Award Identification Number and Year(s): B-13BUS-17-0001 and 2013 CDBG - Disaster Recovery Grants - Pub. L. No. 113-2 Cluster: Hurricane Sandy Community Development Block Grant Disaster Recovery Grants (CDBG-DR), Federal Assistance Listing #14.269 County Department – Department of Planning and Development Finding 2023 – 002 CRITERIA Per the 2013 Funding approval/agreement with the U.S. Department of Housing and Urban Development (HUD), Item 6 states, “The grantee shall comply with requirements established by the Office of Management and Budget (OMB) concerning the Dun and Bradstreet Data Universal Numbering System (DUNS), the System or Award Management (SAM) Central Contractor Registration database, and the Federal Funding Accountability and Transparency Act, including Appendix A to Part 25 of the Financial Assistance Use of Universal Identifier and Central Contractor Registration, 75 Fed. Reg. 55671 (Sept. 14, 2010) (to be codified at 2 CFR part 25) and Appendix A to Part 170 of the Requirements for Federal Funding Accountability and Transparency Act Implementation, 75 Fed. Reg. 55663 (Sept. 14, 2010) (codified at 2 CFR part 170).” The Federal Funding Accountability and Transparency Act (FFATA) Subaward Reporting System (FSRS) website states, “FSRS is the reporting tool Federal prime awardees (i.e. prime contractors and prime grants recipients) use to capture and report subaward and executive compensation data regarding their first-tier subawards to meet the FFATA reporting requirements. Prime contract awardees will report against subcontracts awarded, and prime grant awardees will report against sub-grants awarded.” In addition, “Prime Grant Recipients awarded a new Federal grant greater than or equal to $30,000 as of October 1, 2010 are subject to FFATA sub-award reporting requirements as outlined in the Office of Management and Budgets guidance issued August 27, 2010. The prime awardee is required to file a FFATA sub-award report by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000.” In accordance with 2 CFR Part 170, Reporting Subaward and Executive Compensation Information, Appendix A, Award Term, b. 1. Reporting total compensation of recipient executives for non-Federal entities, states, “You must report total compensation for each of your five most highly compensated executives for the preceding completed fiscal year, if - i. The total Federal funding authorized to date under this Federal award equals or exceeds $30,000 as defined in 2 CFR 170.320; ii. in the preceding fiscal year, you received— (A) 80 percent or more of your annual gross revenues from Federal procurement contracts (and subcontracts) and Federal financial assistance subject to the Transparency Act, as defined at 2 CFR 170.320 (and subawards), and (B) $25,000,000 or more in annual gross revenues from Federal procurement contracts (and subcontracts) and Federal financial assistance subject to the Transparency Act, as defined at 2 CFR 170.320 (and subawards); and, iii. The public does not have access to information about the compensation of the executives through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986. 2. Where and when to report. You must report executive total compensation described in paragraph b.1. of this award term: i. As part of your registration profile at https://www.sam.gov. ii. By the end of the month following the month in which this award is made, and annually thereafter.” CONDITION During the current audit period, the Cook County Department of Planning and Development (DPD) did not comply with its FFATA reporting requirements as outlined in its grant agreement and federal regulations. CAUSE Based on discussions with management, this finding occurred due to not reporting FFATA information for one subrecipient that was awarded in fiscal year 2023 for the CDBG-DR grant. EFFECT Failure to prepare and submit required reports is a violation of federal regulations and impairs the grantor agency’s ability to adequately monitor the program activities/federally funded program. QUESTIONED COSTS None. CONTEXT We noted a total of 37 subrecipients received a sub-award greater than $30,000 in the prior fiscal year(s). Of these 37 subrecipients, we noted 7 had grant disbursements during the County’s fiscal year 2023 and hence, should have been subject to FFATA Subaward reporting. Based on our follow up discussions with DPD personnel, of the 37 subrecipients awarded, only one (1) subrecipient received a new sub-award during fiscal year 2023. Consequently, we were not provided with any evidence that DPD submitted any reporting information as required under the FFATA Subaward Reporting, in the FSRS system. IDENTIFICATION OF REPEATED FINDINGS None. RECOMMENDATION We recommend that DPD develop and implement procedures to ensure required reports are prepared, reviewed, and submitted in a timely manner and in compliance with its grant agreement and federal regulations. Per federal regulations, prime grant recipients awarded a new federal grant greater than or equal to $30,000 as of October 1, 2010, are subject to FFATA sub-award reporting requirements as outlined in the Office of Management and Budgets guidance issued August 27, 2010. The prime awardee (i.e., County DPD) is required to file a FFATA sub-award report by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If any federal requirement is unclear, we recommend that DPD reach out to its grantor agency for additional clarification and guidance. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS The County agrees with the finding and recommendation. The County’s corrective action plan is on page 53.