Regional School Unit No. 19Local Government

2020-001 ? Child Nutrition Cluster (CFDA 10.553 ? 10.559) Special Tests and Provisions ? Verification of Free and Reduced Price Applications Criteria: Each school year, the Local Education Agency (LEA) must verify the current free and reduced price eligibility of households selected from a sample of applications. The LEA must follow up on children whose eligibility status has changed as the result of verification activities to put them in the correct category. Statement of Condition: As a result of verification activities, the School Unit had three households that required changes in eligibility status. Cause: The School Unit did not update the eligibility status of three households that required changes as a result of verification activities. Effect: The School Unit had three households that continued to be listed as eligible for free or reduced meals even though the verification process indicated those households were no longer eligible under their current status. Recommendation: We recommend that the School Unit do a thorough review of the list of students eligible for free or reduced meals to ensure that all required status changes for eligibility have been made.

2019-001 ? Uniform Guidance Procurement Standards Criteria: One of the more significant provisions of the Uniform Guidance that affects the School Department is the procurement standards under 2 CFR sections 200.318 through 200.326. Under the new procurement standards, the School Unit is required to have a documented purchasing policy, which at a minimum, incorporates the provisions of the Uniform Guidance. Statement of Condition: The Office of Management and Budget (OMB) revised regulations applicable to federally funded programs. The new regulations are contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). The Uniform Guidance replaced OMB Circulars A-133, A-87, and A-110 and incorporates new requirements for grant recipients. The Uniform Guidance includes not only protocols for program management and administration, but also updates compliance regulations for federal awards. Currently, the School Unit does not have a formal written procurement policy that incorporates all provisions of the Uniform Guidance procurement standards. Cause: The School Unit has not adopted a procurement policy that covers all aspects required by the Uniform Guidance. However, during our testing of procurement over federal expenditures, we did not notate any violations of the Uniform Guidance procurement standards. Effect: Items required by the Uniform Guidance procurement standards that are not currently addressed in the School Unit?s procurement policy are as follows: Conflicts of interest and governing the actions of its employees engaged in the selection, award and administration of contracts Contracting with small and minority businesses, women?s business enterprises, and labor surplus area firms Bonding requirements Contract provisions Subrecipient and contractor determinations Retention requirements for records Recommendation: We recommend that management review the applicable provisions of the Uniform Guidance procurement standards and update the School Unit?s procurement policy appropriately. This would include adding any missing components to the School Unit?s current procurement policy and updating definitions of types of procurement, i.e., micro-purchases, small purchases, and small acquisition threshold, to match the language used in the Uniform Guidance procurement standards. Management response/corrective action plan: Business Manager and Superintendent will work with the Policy Committee and the Board to update the districts Procurement Policy to assure it complies with the new Federal Uniformed Guidance standards.

2019-002 ? Child Nutrition Cluster (CFDA 10.553 ? 10.559) Eligibility Criteria: A child?s eligibility for free or reduced price meals under a Child Nutrition Cluster program may be established by the submission of an annual application or statement which furnishes such information as family income and family size. Local education agencies determine eligibility by comparing the data reported by the child?s household to published income eligibility guidelines. Statement of Condition: The School Unit currently uses annual applications to determine a child?s eligibility for free or reduced meals if that child is not determined to be eligible through other means (e.g., direct certification by the State). Cause: The School Unit did not retain applications for all children that were determined to be eligible for free or reduced meals through the application process. Effect: The School Unit could potentially provide free or reduced meals to children who are not eligible based on income guidelines. Recommendation: We recommend that the School Unit retain documentation of eligibility status for each child enrolled in free and reduced meals under the Child Nutrition program. Such documentation should include applications with income eligibility determinations. Management response/corrective action plan: The Director of Food Services process several hundred applications each year. During the audit, there was one application that could not be found. The student in question has the same status every year. I have to assume that that application just got mixed in with other paperwork and could not be found. The Director of Food Services will work to be more careful when filing applications going forward.

2019-003 ? Child Nutrition Cluster (CFDA 10.553 ? 10.559) Special Tests and Provisions ? Verification of Free and Reduced Price Applications Criteria: Each school year, the Local Education Agency (LEA) must verify the current free and reduced price eligibility of households selected from a sample of applications. The LEA must follow up on children whose eligibility status has changed as the result of verification activities to put them in the correct category. Statement of Condition: As a result of verification activities, the School Unit had four households that required changes in eligibility status. Cause: The School Unit did not update the eligibility status of all four households that required changes as a result of verification activities. Effect: The School Unit had four households that continued to be listed as eligible for free or reduced meals even though the verification process indicated those households were no longer eligible under their current status. Recommendation: We recommend that the School Unit do a thorough review of the list of students eligible for free or reduced meals to ensure that all required status changes for eligibility have been made. Management response/corrective action plan: There were four families that were to have their statuses changed due to their response to the verifications of their applications. On a certain date, if the families do not respond or it is found that, based on income, their status changes, they will move to the new status. This change did not happen for these four students as required. In the period of when the change should have happened and when it was discovered by the audit, one student did not eat any meals, one had three meals. The other two ate almost every day. The change in the status is critical in the verification process. The Director of Food Services will work to review and update procedures to assure it does not happen again.