FAC Explorer

Finding 44455 (2022-007)

Significant Deficiency
Requirement
H
Questioned Costs
-
Year
2022
Accepted
2023-10-01
Audit: 47633
Organization: City of Sheboygan (WI)
Auditor: Baker Tilly US LLP

AI Summary

  • Core Issue: The City disbursed funds from the Guaranteed Loan Fund Account after the September 30, 2022 deadline.
  • Impacted Requirements: 46 out of 72 transactions were not compliant with HUD's contract terms regarding fund disbursement.
  • Recommended Follow-Up: The City should create procedures to review contracts and ensure awareness of grant deadlines.

Finding Text

Criteria: The contract for Loan Guarantee Assistance under Section 108 of the Housing and Community Development Act of 1974 between the City and the U.S. Department of Housing and Urban Development (HUD) states that all funds in the Guaranteed Loan Fund Account must be withdrawn and disbursement by the Borrower for approved activities by September 30, 2022. Condition/Context: During our testing, we noted 46 out of 72 transactions claimed under the grant that were paid after September 30, 2022. Cause: The City was unaware of any deadlines to disburse the funds received from HUD. Effect: Costs could be claimed outside of the allowable period of performance. Questioned Costs: Unknown Recommendation: We recommend that the City develop and implement procedures for reviewing contracts and award agreements to determine the grant period of performance.

Corrective Action Plan

Management agrees with the comment. The Finance Department in coordination with Planning and Development will create and implement internal procedures for reviewing contracts and award agreements to ensure the applicable deadlines are being followed.

Categories

HUD Housing Programs Period of Performance Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 44454 2022-006
    Significant Deficiency
  • 620896 2022-006
    Significant Deficiency
  • 620897 2022-007
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
21.027 Coronavirus State and Local Fiscal Recovery Funds $7.69M
66.468 Capitalization Grants for Drinking Water State Revolving Funds $4.06M
14.248 Community Development Block Grants_section 108 Loan Guarantees $3.20M
20.526 Buses and Bus Facilities Formula, Competitive, and Low Or No Emissions Programs $2.21M
20.507 Federal Transit_formula Grants $727,233
14.218 Community Development Block Grants/entitlement Grants $522,265
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $22,948
16.710 Public Safety Partnership and Community Policing Grants $20,034
20.600 State and Community Highway Safety $14,918