Finding 59503 (2022-001)

Finding 2022-001: Special Tests and Provisions - Obligation Requirements Program Name: COVID-19 Emergency Solutions Grant Program and Emergency Shelter Grant Program (ESG), AL Number: 14.231 (Grant No. MW420103 and MC420103) Criteria of Specific Requirement: The City is to obligate ESG COVID-19 funds timely in accordance with HUD and federal requirements. Condition: The City?s ESG sub-recipient contracts related to ESG COVID-19 funding were not signed within 240 days of HUD?s grant agreement with the City as prescribed in the ESG single audit compliance supplement and 24 CFR 576.203(a)(1)&(2). Current year testing found non-COVID-19 funded contracts selected were signed within the 180 days of the City?s signed agreement with HUD. Questioned Costs: None Cause: Delays in coordination due to pandemic needs and restrictions resulted in contracts related to ESG COVID-19 funds not being obligated within 240 days of the signed HUD contract. Effect: Failure to execute subawards timely resulted in noncompliance with Federal statues, regulations, and the terms and conditions of the subaward. Identification as a Repeat Finding: This is not a repeat finding from the prior audit. Recommendation: The City should implement procedures to ensure all sub-recipient contracts are signed within the required number of days from the City?s signed agreement with HUD. Views of Responsible Officials and Planned Corrective Actions: Management agrees; see separate corrective action plan.