Finding 547985 (2024-101)

Cluster name: CDBG – Entitlement/Special Purpose Grants Cluster Assistance Listings number and name: 14.218 Community Development Block Grants/Entitlement Grants Award numbers and years: B-20-UW-04-0501, July 1, 2023 through September 1, 2027; B-23-UC-04-0501, July 1, 2023 through September 1, 2030 Federal agency: U.S. Department of Housing and Urban Development Compliance requirement: Reporting Questioned costs: Not applicable Condition—Contrary to federal laws and regulations and County policies, the Maricopa County Human Services Department (Department) failed to report certain information on the federal government’s reporting system for $953,103 in subawards it made to 4 subrecipients during fiscal year 2024 for the program. Specifically, for 4 of 9 subawards tested, the Department did not report any required information about the subawards, including subaward organizations’ names and subaward amounts and terms. During fiscal year 2024, the Department spent $953,103 of federal monies related to these subawards, or 30.5 percent of the Department’s total $3.13 million expended, for this program. Effect—The County’s stakeholders and the public did not have access to transparent and timely information about the Department’s federal award spending decisions on USAspending.gov as required by federal laws and regulations. Additionally, the Department is at risk that this finding applies to other federal programs it administers. Cause—The Department’s contract specialist did not include these 4 subawards on the tracking list used to monitor grants and report information to the federal government’s reporting system as required, because 3 of the subawards were contracted by the Office of Procurement Services rather than directly through the Department and 1 subaward amendment was not included due to error. Criteria—The Federal Funding Accountability and Transparency Act (FFATA) and federal Uniform Guidance regulations require the Department, as a direct recipient of federal awards, to report certain information about each subaward action equaling or exceeding $30,000 in federal monies on the FFATA Subaward Reporting System no later than month-end of the month following the subaward action so that the information can be displayed to the public on the website, USAspending.gov.1 Specifically, the federal Uniform Guidance requires the Department to report the subrecipient organization’s name, award amount, award term, and other information about the subaward, if applicable, for each subaward action equaling or exceeding the $30,000 threshold (2 Code of Federal Regulations [CFR], §170.320 and Appendix A to part 170). Additionally, the County’s grant policies and procedures require the Department to perform this reporting for federal awards (Maricopa County Grants Manual [2023], Section K, page 31). Further, federal regulation requires establishing and maintaining effective internal control over federal awards that provides reasonable assurance that the federal program is being managed in compliance with all applicable laws, regulations, and award terms (2 CFR §200.303). Recommendations—The Department should: 1. Immediately report on the FFATA Subaward Reporting System the required information for its subawards for this program, including the 4 that were not previously reported. 2. Follow the County’s grant policies and procedures for reporting subaward actions equaling or exceeding $30,000 no later than month-end of the month following the subaward action, as required by the FFATA and federal Uniform Guidance, which may require providing training to Department staff responsible for reporting the Department’s subaward actions to the federal government’s reporting system. 3. Review and update the tracking list used to monitor grants and report information to the federal government’s reporting system, ensuring all grants contracted through other departments and amendments are included. The County’s corrective action plan at the end of this report includes the views and planned corrective action of its responsible officials. We are not required to audit and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy. 1 The FFATA of 2006 (Public Law 109-282), as amended by section 6202 of Public Law 110-252, was enacted to provide the public with transparency on federal award spending to hold the recipient government accountable for each spending decision and to help reduce wasteful spending of federal monies. As such, federal Uniform Guidance requires reporting on the FFATA Subaward Reporting System at https://www.fsrs.gov.