Finding Text
FINDING 2023-002
Evaluation of federal compliance requirements when receiving subawards (Deficiency)
U.S. Department of Health and Human Services
Community Services Block Grant (Federal Assistance Listing #93.569) Federal Award Numbers:
60204, 60215, 60225, and 60235
Federal Award Year: 2020-2024
Criteria:
As included within the 2023 Compliance Supplement, the Community Services Block Grant (“CSBG”) Act at 42 USC 9910(a), requires nonprofit organizations administer CSBG through a Tri-Partite board comprising:
• One-third (1/3) of the members be elected representatives in the community or their designee (the elected official must be holding office on the date of selection). There is a provision that allows for appointed government officials, or their designee, to be counted in meeting this requirement.
• Not fewer than one-third (1/3) of the board members are chosen in a democratic selection process adequate to assure that these members of the board are representative of the low-income individuals and families served. Additionally, each low-income representative must reside in the neighborhood served.
• The remaining board members are officials and members of business, industry, labor, religious, law enforcement, education, or other major groups and interests in the community served.
Condition:
We noted that BCS did not comply with the Tri-Partite board requirement.
Cause:
Management has indicated their board does not comply with this requirement as they receive their CSBG as a pass through from New York City Department of Youth and Community Development (“NYC DYCD”) (i.e. BCS is a subrecipient of NYC DYCD) and this requirement had not been discussed with, or included in, the pass-through grant with NYC DYCD.
Management did not prepare evaluation of the federal compliance supplement special tests and provisions requirements at the time the subaward was received. While the grant was passed through NYC DYCD, specific federal compliance requirements must still be evaluated for applicability. By not performing a review of these federal requirements management was not aware of the Tri-Partite board requirement.
Effect:
The CSBG expenditures are not being administered by a Tri-Partite board as required by the CSBG Act.
Questioned Costs:
None identified.
Identified as a Repeat Finding:
Yes.
Recommendation:
Upon entering into subaward grant agreements management should evaluate all direct and material federal compliance requirements to ensure controls are designed for the required compliance. In addition, the CSBG expenditures should be administered by a Tri-Partite board as required by the CSBG Act or a federal waiver or clarification on their exemption from U.S. Department of Health and Human Services should be obtained by Brooklyn Community Services.
Views of Responsible Officials:
See management’s response and corrective action plan.