Finding Text
2022-005: Federal Transit Cluster ? AL# 20.507, Cash Management ? Material Noncompliance/Material Weakness in Controls over Compliance Condition: A lack of cash flow and grant management oversight resulted in contractors not being paid timely for the construction of the bus transfer station. Criteria: All grant activities should include management level oversight to ensure timeliness, accuracy, and compliance with specified grant requirements. Cause: Lack of proactive cash flow and grant management occurred when invoices received. Effect: Contractors were not paid for over 30 days after receipt of invoice. Repeated delays in payments could result in work stoppage and project delays. Recommendation: A designated management level individual should have oversight to require timely drawdowns of capital grants and timely payment of invoices. Views of Responsible Officials and Planned Corrective Actions: Due to technical issues, staff was unable to submit grant draw requests to the Federal Transit Authority through their Electronic Clearing House Operation [ECHO] system, significantly effecting the company?s cash flow. This system access issue is now resolved and management has targeted April 30, 2023 to complete eligible drawdowns. Additionally, detailed spreadsheets tracking grant activity have been developed, which will allow staff to better monitor reimbursement requests and a specific task related to ensuring payment to the transfer station construction vendor has been added to the newly-developed monthly close list.