Akron - Canton Regional Airport AuthorityLocal Government

Finding Number: 2025-003 Federal Program: Airport Improvement Program Federal Award Identification Number and Year: All Airport Improvement Program awards, 2025 Assistance Listing Number (ALN): 20.106 Federal Awarding Agency: U.S. Department of Transportation Pass-through Entity: None Repeat Finding: No Significant Deficiency and Noncompliance – Matching Criteria: The Airport Improvement Program grant agreement requires the recipient to provide the required non-federal matching share for eligible project costs in accordance with the approved grant agreement and applicable federal requirements. Under 2 CFR 200.306, non-federal entities must meet applicable cost sharing or matching requirements. Matching contributions must be verifiable from the recipient’s records, not included as contributions for any other federal award, necessary and reasonable for the accomplishment of project objectives, allowable under the cost principles, and provided for in the approved budget when required. Additionally, 2 CFR 200.303 requires non-federal entities to establish and maintain effective internal control over federal awards that provides reasonable assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: During testing, we noted the Airport did not properly ensure that the required local matching contribution was provided and documented in accordance with the grant agreement. Specifically, the grant agreement required a non-federal/local match of five percent. However, the Airport’s accounting records and supporting documentation reflected a local match of ten percent, resulting in a match overstatement of $18,244 in 2025. The Airport did not have a formal review process in place to verify compliance with the required matching percentage before reimbursement requests were submitted. Questioned Costs: None. Identification of How Questioned Costs Were Computed: N/A Cause and Effect: The Airport did not have adequate internal controls to ensure that the required local match was calculated, tracked, reviewed, and documented throughout the grant period. Management relied on project expenditure records and reimbursement activity; however, it did not reconcile total eligible project costs to the required federal and non-federal cost-share percentages. Additionally, responsibilities for monitoring the matching requirement were not clearly assigned, and there was no documented supervisory review of match calculations. As a result, the Airport was not in compliance with the matching requirements of the Airport Improvement Program grant agreement. The federal match was understated, therefore no questioned costs identified. Recommendation: The Airport should establish and implement internal controls over federal grant matching requirements. Views of Responsible Officials and Corrective Action Plan: See Corrective Action Plan.

Finding Number: 2025-004 Federal Program: Airport Improvement Program Federal Award Identification Number and Year: All Airport Improvement Program awards, 2024, 2023 Assistance Listing Number (ALN): 20.106 Federal Awarding Agency: U.S. Department of Transportation Pass-through Entity: None Repeat Finding: No Material Weakness and Noncompliance – Allowability Criteria: Under 2 CFR 200.403, costs charged to federal awards must be allowable, meaning they are necessary, reasonable, allocable, adequately documented, and comply with the terms and conditions of the federal award. Additionally, 2 CFR 200.302(b)(7) requires financial management systems to include effective internal controls over accountability of expenditures, including proper review and approval. Per 2 CFR 200.303, the Entity must establish and maintain effective internal control over federal awards to provide reasonable assurance that expenditures are allowable and in compliance. Condition: During testing of expenditures charged to the Airport Improvement Program, we identified that the Airport did not consistently follow its established invoice approval procedures. Specially, two of five checks tested, invoices totaling $1,469,973, lacked documented evidence of CEO and Vice President of Landside, Planning & Infrastructure’s approval prior to payment. The invoices were approved for payment by the Vice President of Finance and Administration. Questioned Costs: None. Identification of How Questioned Costs Were Computed: N/A Cause and Effect: The CEO and Vice President of Landside, Planning & Infrastructure did not sign off on invoices for Airport Improvement Program expenditures as an indication of their approval and allowability. There is an increased risk of expenditures not being allowable if the control process is not properly followed. Recommendation: The Airport should ensure that all purchasing controls are followed when incurring expenditures of federal funds and that purchases are properly approved prior to payment. Views of Responsible Officials and Corrective Action Plan: See Corrective Action Plan.

Federal Program: Airport Improvement Program Federal Award Identification Number and Year: All Airport Improvement Program awards, 2021, 2022, 2023, 2024 Assistance Listing Number (ALN): 20.106 Federal Awarding Agency: U.S. Department of Transportation Pass-through Entity: None Repeat Finding: No Material Weakness and Noncompliance – Wage Rate Requirements Criteria: All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141–3144, 3146, and 3147. Nonfederal entities shall include in their construction contracts subject to the Wage Rate Requirements (which still may be referenced as the Davis-Bacon Act) a provision that the contractor or subcontractor comply with those requirements and the DOL regulations (29 CFR Part 5, Labor Standards Provisions Applicable to Contacts Governing Federally Financed and Assisted Construction). This includes a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls) (29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326). Condition: The Airport was unable to provide documentation to support compliance with wage rate requirements in relation to AIP project 8023. Questioned Costs: None. Identification of How Questioned Costs Were Computed: N/A Cause and Effect: The Airport was not aware that the contracts for AIP project 8023 were applicable to prevailing wage requirements; therefore, the Airport did not obtain certified payrolls for two contracts relating to the project. Without proper controls over wage-rate requirements, there is an increased risk that the Airport, its contractors, and subcontractors are not in compliance with applicable federal regulations. Additionally, noncompliance could result in federal funding being reduced or taken away, or other sanctions imposed by the federal grantor agency. Recommendation: The Airport should implement controls and processes to ensure that all necessary information from contractors is obtained to document compliance with wage rate requirements. Views of Responsible Officials and Corrective Action Plan: See Corrective Action Plan.

Finding Number: 2023-004 Federal Program: Airport Improvement Program Federal Award Identification Number and Year: All Airport Improvement Program awards, 2020, 2021, 2022, 2023 Assistance Listing Number (ALN): 20.106 Federal Awarding Agency: U.S. Department of Transportation Pass-through Entity: None Repeat Finding: No Material Weakness and Noncompliance – Reporting Criteria: Unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMBapproved governmentwide data elements for collection of financial information (at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead. This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances. (2 CFR 200.328). Until the grant is completed and closed, recipients are responsible for submitting formal reports as follows: A signed/dated SF-270 (non-construction projects) or SF-271 or equivalent (construction projects) and SF- 425 annually, due 90 days after the end of each federal fiscal year in which this grant is open (due December 31 of each year this grant is open). Condition: The Airport did not file the required reports within the timeframes above. Questioned Costs: None. Identification of How Questioned Costs Were Computed: N/A Context: Standard Forms 425 and Standard Forms 271 for the reporting period ended September 30, 2023 were filed on January 19, 2024. Cause and Effect: The Airport did not prepare or submit the required forms by December 31, 2023. The SF-425 and SF-271 reports for the period ending September 30, 2023 were submitted 19 days after the due date. Recommendation: The Airport should implement controls and processes to ensure that the required reports are submitted timely. Views of Responsible Officials and Corrective Action Plan: See Corrective Action Plan.