Finding Text
Cluster name: WIOA Cluster
Assistance Listings numbers and names: 17.258 WIOA Adult Program
17.259 WIOA Youth Activities
17.278 WIOA Dislocated Worker Formula Grants
Award number and year: DI21-002285 A1, April 1, 2021 through June 30, 2023
Federal agency: U.S. Department of Labor
Pass-through grantor: Arizona Department of Economic Security
Compliance requirements: Earmarking
Questioned costs: $32,344
Condition—Contrary to federal regulation, the County's Workforce Innovation and Opportunity Act (WIOA) Department failed to ensure that it spent the required 20 percent, or $74,233, of WIOA Youth Activities monies earmarked to provide in-school and out-of-school youth with paid and unpaid work experiences from April 2021 through June 2023. Instead, the County spent only 11 percent, or $41,889, of the required 20 percent and spent the remaining 9 percent, or $32,344, for other youth activities, such as education and youth development.
Effect—County youth did not receive $32,344 of paid and unpaid work experience services that the federal program intended. Also, the Department may have received $32,344 in federal program monies that it was not entitled to.
Cause—The Department used a tracking mechanism to accurately report its paid and unpaid work experiences spending throughout the fiscal year but did not properly monitor its WIOA Youth Activities spending to ensure the 20 percent earmarking requirement was met. Although the Department had worked on developing strategies, training materials, and presentations for employers and potential participants to follow, these materials were not effectively implemented by the end of the grant award to recruit and retain qualified in-school and out-of-school youth who would benefit from paid and unpaid work experiences. Further, the Department failed to ensure it monitored its paid and unpaid work experience expenditures throughout the award period, and adjusted spending when work experience participation was lower than expected.
Criteria—Federal regulation requires the Department to earmark and spend no less than 20 percent of its WIOA Youth Activities monies to provide in-school and out-of-school youth with paid and unpaid work experiences. Additionally, federal regulation also requires the Department to monitor such expenditures and report them to the pass-through grantor monthly throughout the award period to ensure it is spending the monies in a timely manner to meet the earmarking requirement (20 Code of Federal Regulations [CFR] §681.590). Federal regulation also requires establishing and maintaining effective internal control over federal awards that provides reasonable assurance that federal programs are being managed in compliance with all applicable laws, regulations, and award terms (2 CFR §200.303).
Recommendations—The Department should:
1. Spend no less than the required 20 percent of its WIOA Youth Activities monies to provide in-school and out-of-school youth with paid and unpaid work experiences.
2. Include a process in its WIOA Youth Activities program’s policies and procedures to:
a. Fully implement new strategies to recruit and retain qualified in-school and out-of-school youth who will benefit from the paid and unpaid work experience the program provides.
b. Monitor both the County and its subrecipient’s paid and unpaid work experiences spending throughout the award period.
c. Adjust spending to meet the earmarking requirement if work experience participation is lower than expected.
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 and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy.
This finding is similar to prior-year finding 2022-103 and was initially reported in fiscal year 2019.