Finding Text
2022-002: Federal Program information: COVID-19: ELC Contact Tracing Grant AL 93.323; Federal Award Date: 5/19/20 and 3/27/20; Award No. 6NU50CK000559-01-08; Pass through entity: Illinois Department of Public Health, Grant No. 05180145H; Criteria or specified requirement: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award's period of performance. Unless the federal awarding agency or pass-through entity authorizes an extension, a non-federal entity must liquidate all financial obligations incurred under the federal award not later than 120 calendar days after the end date of the period of performance as specified in the terms and conditions of the federal award. When used in connection with a non-federal entity's utilization of funds under a federal award, "financial obligations" means orders placed for property and services, contracts and subawards made, and similar transactions during a given period that require payment by the non-federal entity during the same or a future period. Condition: The Kankakee County Health Department (KCHD) ordered technology equipment and related installation services in the amount of $123.133 to update their technology capabilities in March 2022. The entire amount of the project was charged to the COVID-19 ELC Contact Tracing grant, which ended March 31, 2022. The KCHD released a payment of $55,390 to the vendor in September 2022 for equipment that had been received and installed at that time. No additional equipment had been installed until March 2023. While the KCHD had a financial obligation as of March 31, 2022 under this grant, it was unable to be liquidated within 120 days after the grant period ended as the work had not been completed. Cause: The KCHD does not have proper internal controls in place or adequate resources available to review outstanding grant expenditures to ensure all are liquidated within the appropriate period. Effect: The KCHD discussed the project delay with the pass-through entity, who determined that the $55,390 paid in September 2022 would be allowed, however, grant funds received in the amount of $67,743, representing the incomplete portion of the project, are to be repaid to the pass-through entity. Questioned costs: Questioned costs were identified in the amount of $67,743. This is the total amount of the project which was not completed within the period of performance, nor were the financial obligations able to be liquidated within the appropriate period. Context: Project delays of this magnitude are unusual. Supply chain issues caused by the pandemic resulted in significant project delays beyond those encountered by the KCHD in the past. Recommendation: We recommend that the KCHD implement internal controls to review outstanding items and ongoing projects, particularly those charged to grants, for proper reporting to ensure compliance with the terms of the award. Additionally, the KCHD should allocate or obtain adequate resources to the financial and grant reporting function to ensure compliance. Management's response: See attached response.