County of Westmoreland, Pennsylvania

WESTMORELAND COUNTY CORRECTIVE ACTION PLAN DECEMBER 31, 2019 2019-001 PA DHS - County Human Services Block Grant CFDA No. 93.958; Block Grants for Community Mental Health Services Condition: Advanced grant fund payments received are held in a restricted, interest-bearing investment account until expended. On December 26, 2019, the County General Fund borrowed $4,215,000 from the BHDS Program investment account. The investment account contained federal and state grant funds received from the Commonwealth of Pennsylvania under the County Human Services Block Grant and the Early Intervention Program. The funds were repaid to the BHDS Program investment account as follows: January 9, 2020 $765,000; January 15, 2020 $540,000; and April 17, 2020 $2,910,000. Interest in the amount of $15,253 was paid from the General Fund to the BHDS Program investment account on July 30, 2020 based on the average monthly interest rate received on the investment. Criteria: Advance payments of Federal and State funds must be deposited and maintained in insured accounts whenever possible. Although separate depositories for funds are not required, the County must be able to account for the receipt, obligation and expenditure of the funds. Cause: Procedures are in place to maintain funds in each County department and/or program. A retiring employee in the Financial Administration office provided for the transfer to the General Fund pending the receipt of tax revenue. The transfer took place without precedence and without the knowledge of either the BHDS Program staff or the County Controller?s office staff. Funds were returned immediately when the BHDS Program staff contacted the County Controller?s office, who in turn contacted the Financial Administration office. Effect: The federal and state grant funds were temporarily not held in a restricted, interest bearing investment account. The County General Fund reimbursed the BHDS Program investment account for the interest that would have been earned during the period of the loan. The County was able to account for the receipt, obligation and expenditure of the funds at all times. The net effect on the BHDS Program and the related federal and state grants funds was corrected . Questioned Costs: None Recommendation: Advance payments of Federal and State funds should be deposited and maintained in insured accounts whenever possible. Views of Responsible Officials and Planned Corrective Actions: Westmoreland County agrees with the finding and has reemphasized the policy of segregating grant funds from unrestricted funds.