Finding Text
Finding - District controls did not always ensure compliance with Federal regulations by properly expending Federal Hurricane Education Recovery Program funds, resulting in questioned costs totaling $325,202.
Criteria - Title 2, Section 200.403(a), CFR, requires that allowable costs under Federal awards must be necessary and reasonable for the performance of the Federal award. In addition, Public Law 109-148 established the Hurricane Education Recovery Program and specifies in Section 102(e)(3)(A) that funding may not be used for construction or major renovations of school buildings.
Condition - During the 2022-23 fiscal year, District Hurricane Education Recovery Program expenditures totaled $1,230,221, and included four payments totaling $325,202 for construction or major renovation of school facilities. Specifically, a payment for $199,500 was made for the roof replacement of a District building, and three additional payments, totaling $125,702, were made for architectural and engineering services related to the construction of the new Gadsden County K-8 School. Additionally, the approved grant application only included temporary repairs to the roof, including tarping and cleanup of water damage and did not include any architectural or engineering services.
Cause - Due to staff turnover and the subsequent reassignment of duties, the District grant director lacked Hurricane Education Recovery Program experience. In response to our inquiry, District staff indicated that the Program expenditures were allowable for District site and facilities that were not damaged before the hurricane. Notwithstanding, District staff did not provide documentation from the grantor supporting allowability and the expenditures are explicitly unallowed by the Public Law.
Effect - Absent effective procedures to ensure that grant funds are expended only for allowable uses, there is an increased risk that funds will be misused. Since District records did not support the allowability of these costs, the District incurred questioned costs totaling $325,202.
Recommendation - The District should help ensure that Hurricane Education Recovery Program expenditures are only for allowable purposes by providing appropriate training for the Program grant director. In addition, the District should document to the FDOE the allowability of the questioned costs or contact the FDOE regarding necessary corrective action.
District Response - The District confirms the audit finding and will implement policies and procedures, as well as staff training, to ensure compliance with the Federal Hurricane Education Recovery Program.