FAC Explorer

Finding 524152 (2024-005)

Material Weakness Repeat Finding
Requirement
F
Questioned Costs
-
Year
2024
Accepted
2025-02-21
Audit: 343340
Organization: City of Santa Fe (NM)
Auditor: Carr Riggs & Ingram

AI Summary

  • Core Issue: The City’s annual inventory for federally funded equipment is incomplete, lacking details on funding sources.
  • Impacted Requirements: This violates 2 CFR 200.303(a) and 2 CFR 200.313(d)(1) regarding internal controls and property record maintenance.
  • Recommended Follow-Up: Improve internal controls and ensure accurate property records to prevent improper disposal of federally funded equipment.

Finding Text

2024-005 (2023-006) – Equipment and Real Property Management (Material Weakness over Internal Controls over Compliance) (Repeated/Modified) Federal Program Information Federal Award Title and ALN: Airport Improvement Program, 20.106 Federal Awarding Agency: Department of Transportation, Federal Aviation Administration Federal Award ID Number: SAF-SWG-3-35-0037-051-2020 Federal Award Year: 2024 Condition: The City’s approved annual inventory was not complete. There was no information to identify the funding source of the equipment and/or property. Management’s Progress on Repeat Findings: Some progress made from prior year. Criteria: Per 2 CFR 200.303(a), the non-federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Per 2 CFR 200.313(d)(1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. Cause: Turnover in related positions resulted in delays in making revisions to the listing to incorporate information on Federal participation in the purchases. Questioned Cost: None. Effect: The City could dispose of federally funded equipment without following federal guidelines.

Corrective Action Plan

Auditor recommendation: The auditor recommends the City enhance the design of its control activities and create a tool to assist in tracking and maintaining equipment purchased with federal funds. Additionally, the employees responsible for the inventory should be trained to ensure understanding of the Uniform Guidance requirements relevant to equipment and real property management. Periodic review should also be designed to evaluate compliance with relevant requirements. Views of Responsible Officials and Planned Correc􀀁ve Ac􀀁on: The City agrees with this finding. During FY24 the Airport Manager hired a Heavy Equipment Mechanic. This posi􀀁on is responsible for tracking, maintaining, and repairing Airport equipment. Logbooks are now being kept for all equipment. In CY25 the Finance Director, the Accoun􀀁ng Officer, and the Grants team will work with the Airport team to improve internal controls over equipment purchased with federal funds. Policies and procedures will be developed to ensure that an accurate physical inventory that contains the informa􀀁on required by the Uniform Guidance is conducted at year-end. The City is in the process of contrac􀀁ng with a vendor to assist the Airport with federal compliance and provide training for Airport staff on relevant Uniform Guidance requirements. The vendor’s scope of work will include helping with developing and documen􀀁ng policies and standard opera􀀁ng procedures related to equipment management. Tools will be developed to facilitate tracking and maintaining equipment purchased with federal funds. Addi􀀁onally, the Airport Department plans to create a Grant Accountant posi􀀁on which will be responsible for reconciling grant expenditures monthly. The Grant Accountant will also work with the Airport Heavy Equipment Mechanic to ensure that the inventory lis􀀁ng includes the funding source used for the purchase (i.e. federal or non-federal). In CY25 the City plans to provide Uniform Guidance to staff which will include capital assets and equipment informa􀀁on, and the specific requirements for the year-end inventory. Responsible Official: Emily Oster, Finance Director, James Harris, Airport Manager, Airport Heavy Equipment Mechanic, Matthew Bonifer, Accounting Officer, Erika Lujan, Grants Manager Timeline and Es􀀁mated Comple􀀁on Date: June 30, 2025

Categories

Equipment & Real Property Management

Other Findings in this Audit

  • 524150 2024-003
    Significant Deficiency
  • 524151 2024-004
    Significant Deficiency Repeat
  • 524153 2024-003
    Significant Deficiency
  • 524154 2024-004
    Significant Deficiency Repeat
  • 524155 2024-005
    Material Weakness Repeat
  • 524156 2024-003
    Significant Deficiency
  • 524157 2024-003
    Significant Deficiency
  • 524158 2024-003
    Significant Deficiency
  • 524159 2024-006
    Significant Deficiency
  • 1100592 2024-003
    Significant Deficiency
  • 1100593 2024-004
    Significant Deficiency Repeat
  • 1100594 2024-005
    Material Weakness Repeat
  • 1100595 2024-003
    Significant Deficiency
  • 1100596 2024-004
    Significant Deficiency Repeat
  • 1100597 2024-005
    Material Weakness Repeat
  • 1100598 2024-003
    Significant Deficiency
  • 1100599 2024-003
    Significant Deficiency
  • 1100600 2024-003
    Significant Deficiency
  • 1100601 2024-006
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
21.027 Covid-19: Coronavirus State and Local Fiscal Recovery Funds $4.23M
20.507 Federal Transit Formula Grants - Ridefinder Transit Enhancement $3.69M
20.507 Covid-19: Federal Transit Formula Grants -Coronavirus Response and Relief Supplemental Appropriations Act $1.66M
14.218 Community Development Block Grants/entitlement Grants $1.51M
20.106 Covid-19: Airport Improvement Program #51 $902,589
20.106 Covid-19: Airport Improvement Program #57 $876,014
20.526 Federal Transit Formula - Buses and Bus Facilities Formula, Competitive, and Low Or No Emissions $531,610
20.505 Metropolitan Transportation Planning and State and Non-Metropolitan Planning and Research $347,268
93.053 Nutrition Services Incentive Program $123,817
93.045 Special Programs for the Aging, Title Iii, Part C-1, Nutrition Services $99,163
93.052 National Family Caregiver Support, Title Iii, Part E $87,833
93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance $68,877
93.044 Special Programs for the Aging, Title Iii, Part B, Grants for Supportive Services and Senior Centers $65,053
97.067 Homeland Security Grant Program $54,614
93.045 Special Programs for the Aging, Title Iii, Part C-2, Nutrition Services $46,806
94.002 Americorps Seniors Retired and Senior Volunteer Program (rsvp) 94.002 $37,500
20.703 Interagency Hazardous Materials Public Sector Training and Planning Grants $36,951
14.218 Covid-19: Community Development Block Grants/entitlement Grants $36,015
20.608 Minimum Penalties for Repeat Offenders for Driving While Intoxicated $33,335
97.042 Emergency Management Performance Grants $26,751
94.011 Americorps Seniors Foster Grandparent Program (fgp) 94.011 $25,198
45.024 Promotion of the Arts Grants to Organizations and Individuals $20,000
95.001 High Intensity Drug Trafficking Areas Program $8,949