Finding Text
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL
EXPENDITURES (50000)
Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213)
Assistance Listing Number: 84.425
Pass-Through Agency: California Department of Education (CDE)
Federal Agency: U.S. Department of Education
Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439
(equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for
general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity.
Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to
be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion
of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this
way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be
obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant
period.
Context: The condition was identified through the testing of ESF expenditures.
Cause: District oversight.
Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency.
Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to
Resource 3213 during the 2022-23 year.
Repeat Finding: This is not a repeat finding.
Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure
purchases from the Education Stabilization Fund in excess of $5,000 for capital projects.
Views of Responsible Officials: See Corrective Action Plan on following page.