Jackson County, FloridaLocal Government

REPORTING – COMPLIANCE AND CONTROLS REPEAT FINDING: NO FEDERAL AGENCY: U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT; PASSED THROUGH FLORIDA DEPARTMENT OF COMMERCE PROGRAM: COMMUNITY DEVELOPMENT BLOCK GRANTS, ALN 14.228 GRANT NUMBERS: H2494, H2384, M0043, M0024, M0150, M0154, MT151 FINDING TYPE: SIGNIFICANT DEFICIENCY CRITERIA: Under 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; the County’s contractor is required to submit a copy of the payroll and a statement of compliance (certified payrolls) weekly for each week in which any contract work is performed. The grant agreements outline the reports required to be submitted and their due dates. Additionally, 2 CFR 200.303(a) of the Uniform Guidance requires non-federal entities to establish and maintain effective internal control over federal awards that provides reasonable assurance that the nonfederal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. CONDITION: 18 of 135 total reports required under the grants were tested for compliance with this requirement. This was not a statistically valid sample. The auditor noted the following which affected 7 of the reports tested: - For 5 reports, there was no evidence of a second review - For 1 monthly progress report, the report was submitted later than the due date - For 1 quarterly progress report, the funds used through the report date were not included at the correct amount and there were other mathematical errors - For 2 reports, the client could not show when the reports were submitted to the grantor CAUSE: Management has not established procedures for reviewing all program reports and/or the reviews failed to identify reporting errors and ensure reports were submitted timely. EFFECT: Certain reports were not submitted timely or may not have been submitted to the grantor, and certain reports were inaccurate. QUESTIONED COSTS: None. The finding is over the reporting compliance requirement. Amounts expended and received from federal awards were not affected. RECOMMENDATION: We recommend procedures be established for review of all program reports prior to submission to the grantors and that the review be documented; procedures be established to ensure reports are submitted timely; and a reconciliations of reported amounts to the accounting records be performed. VIEW OF RESPONSIBLE OFFICIALS: See Management’s Response and Corrective Action Plan beginning on page 122.

SPECIAL TESTS AND PROVISIONS, WAGE RATE REQUIREMENTS – COMPLIANCE AND CONTROLS REPEAT FINDING: NO FEDERAL AGENCY: U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT; PASSED THROUGH FLORIDA DEPARTMENT OF COMMERCE PROGRAM: COMMUNITY DEVELOPMENT BLOCK GRANTS, ALN 14.228 GRANT NUMBERS: H2494, H2384, M0043, M0024, M0150, M0154, MT151 FINDING TYPE: SIGNIFICANT DEFICIENCY CRITERIA: 2 CFR 200.303(a) of the Uniform Guidance requires non-federal entities to establish and maintain effective internal control over federal awards that provides reasonable assurance that the nonfederal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. CONDITION: The County relies on third-party consultants to obtain and review construction contractors’ weekly certified payrolls, and the consultants report the information to the County. In some cases, the County does not review the certified payrolls until the end of the construction contract. Additionally, the auditor tested 2 of 3 grants that had construction performed during the fiscal year for compliance with this requirement and for 1 grant tested, the County could not provide evidence that the consultant verified that the certified payrolls were submitted. The sample was not statistically valid. CAUSE: Management has not established procedures for regular monitoring of consultants’ performance related to obtaining and reviewing evidence of certified payrolls. EFFECT: Certified payrolls for a construction contract subject to wage rate requirements under the Davis-Bacon Act were not reviewed by the County during the fiscal year. QUESTIONED COSTS: None. The auditor is not aware of any amounts paid in violation of Federal statutes as a result of this finding. RECOMMENDATION: We recommend procedures be established for the County to obtain and review of certified payrolls for the construction projects on a more frequent basis to ensure compliance with the wage rate requirements. VIEW OF RESPONSIBLE OFFICIALS: See Management’s Response and Corrective Action Plan beginning on page 122.

BCC 2022-004 ? PERIOD OF PERFORMANCE ? COMPLIANCE AND CONTROLS FEDERAL AGENCY: U.S. DEPARTMENT OF HOMELAND SECURITY, FEDERAL EMERGENCY MANAGEMENT AGENCY PASS-THROUGH ENTITY: FLORIDA EXECUTIVE OFFICE OF GOVERNOR, DIVISION OF EMERGENCY MANAGEMENT PROGRAM: DISASTER GRANTS-PUBLIC ASSISTANCE (PRESIDENTIALLY DECLARED DISASTERS), ALN 97.036 AWARD YEAR: DR 4177 ? 2014 FINDING TYPE: MATERIAL WEAKNESS; MATERIAL NONCOMPLIANCE CRITERIA: 2 CFR 200.303(a) of the Uniform Guidance requires non-federal entities to establish and maintain effective internal control over federal awards that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Additionally, under other Uniform Guidance requirements, the County may charge only allowable costs incurred during the approved budget period of a federal award?s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity. Each individual project under this program has a specified work deadline, which may be extended at the discretion of FEMA. CONDITION: Two projects were tested for compliance with this requirement, including all expenditures during fiscal year 2022 for these projects. The two projects make up the entire population of projects during fiscal year 2022. Both projects have an approved extension of the work deadline (period of performance) through March 31, 2022. However, the County incurred costs for work performed after this extension period. CAUSE: The County is in the process of obtaining approval for an extension of the work deadline for these projects from FEMA. The County has continued to have work performed on the projects in the meantime. EFFECT: If an extension of the work deadline for the projects is not approved, the costs would be ineligible for reimbursement and the County will have reported an incorrect amount of expenditures of federal awards. QUESTIONED COSTS: $462,104. These were determined by totaling costs incurred outside the period of performance based on work dates in the invoices. For any invoices that covered a specified period but costs were not attached to specific dates, the costs were allocated evenly over the period. RECOMMENDATION: We recommend the County obtain approval of an extension of the work deadline for projects prior to incurring costs after the currently approved deadline. VIEWS OF RESPONSIBLE OFFICIALS: See Management?s Response and Corrective Action Plan beginning page 125.

BCC 2022-05 [2021-003] ? REPORTING ? COMPLIANCE AND CONTROLS FEDERAL AGENCY: U.S. DEPARTMENT OF HOMELAND SECURITY, FEDERAL EMERGENCY MANAGEMENT AGENCY PASS-THROUGH ENTITY: FLORIDA EXECUTIVE OFFICE OF GOVERNOR, DIVISION OF EMERGENCY MANAGEMENT PROGRAM: DISASTER GRANTS-PUBLIC ASSISTANCE (PRESIDENTIALLY DECLARED DISASTERS), ALN 97.036 AWARD YEAR: DR 4177 ? 2014, DR 4399 - 2019 FINDING TYPE: MATERIAL WEAKNESS; MATERIAL NONCOMPLIANCE CRITERIA: 2 CFR 200.303(a) of the Uniform Guidance requires non-federal entities to establish and maintain effective internal control over Federal awards that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Additionally, per the County?s grant agreements with Florida Division of Emergency Management (FDEM), quarterly reports are required to be submitted through FloridaPA.com that include project costs and expenditures for each large project. Amounts in the quarterly reports should reconcile to the County?s accounting records and represent actual expenditures. CONDITION: For fiscal year 2021, two large projects were tested for compliance with this requirement, including all quarterly reports submitted for these projects. This was not a statistically valid sample. For all quarterly reports tested, the reported expenditures per quarter were unable to be reconciled to actual expenditures in the quarter per the invoices and other supporting documentation in the County?s files. For fiscal year 2022, two large projects were tested for compliance with this requirement, including all quarterly reports submitted for these projects. The two projects make up the entire population of projects during fiscal year 2022. For all quarterly reports tested, the reported expenditures per quarter were unable to be reconciled to actual expenditures in the quarter per the invoices and other supporting documentation in the County?s files. CAUSE: This was believed to either be a timing difference between when expenditures were reported vs. when the activity actually occurred, and/or that the consulting staff preparing quarterly reports used estimated rather than actual expenditures in the quarterly reports. There was turnover in consulting staff handling the reports during fiscal year 2021 and staff may not have been properly trained. The issues continued in fiscal year 2022. EFFECT: The County is reporting incorrect project expenditures to FDEM in quarterly reports, which can affect project cost tracking. Under the terms of the grant agreements, submission of inaccurate or incomplete reports could result in FDEM ceasing disbursements to the County, termination of the agreements, or other remedies. Under Florida Statutes, FDEM is responsible for oversight of the operations of the federal award supported activities. Due to the County?s incorrect reporting, FDEM could be reporting incorrect expenditures to the federal agency. QUESTIONED COSTS: None. RECOMMENDATION: We recommend additional training for consulting staff handling quarterly reports to ensure the correct amounts are being included, and a specific review of quarterly report information by a higher level prior to submission to ensure accurate reporting of project costs. STATUS: The condition continues to exist. VIEWS OF RESPONSIBLE OFFICIALS: See Management?s Response and Corrective Action Plan beginning page 125.

BCC 2021-003 ? REPORTING ? COMPLIANCE AND CONTROLS FEDERAL AGENCY: U.S. DEPARTMENT OF HOMELAND SECURITY, FEDERAL EMERGENCY MANAGEMENT AGENCY PASS-THROUGH ENTITY: FLORIDA EXECUTIVE OFFICE OF GOVERNOR, DIVISION OF EMERGENCY MANAGEMENT PROGRAM: DISASTER GRANTS-PUBLIC ASSISTANCE (PRESIDENTIALLY DECLARED DISASTERS), ALN 97.036 AWARD YEAR: DR 4177 ? 2014, DR 4399 - 2019 FINDING TYPE: MATERIAL WEAKNESS; MATERIAL NONCOMPLIANCE QUESTIONED COST: NONE CRITERIA: Per the County?s grant agreements with Florida Division of Emergency Management (FDEM), quarterly reports are required to be submitted through FloridaPA.com that include project costs and expenditures for each large project. Amounts in the quarterly reports should reconcile to the County?s accounting records and represent actual expenditures. CONDITION: Two large projects were tested for compliance with this requirement, including all quarterly reports submitted during the 2021 fiscal year for these projects. This was not a statistically valid sample. For all quarterly reports tested, the reported expenditures per quarter were unable to be reconciled to actual expenditures in the quarter per the invoices and other supporting documentation in the County?s files. CAUSE: This was believed to either be a timing difference between when expenditures were reported vs. when the activity actually occurred, and/or that the consulting staff preparing quarterly reports used estimated rather than actual expenditures in the quarterly reports. There was turnover in consulting staff handling the reports during the year, and staff may not have been properly trained. EFFECT: The County is reporting incorrect project expenditures to FDEM in quarterly reports, which can affect project cost tracking. Under the terms of the grant agreements, submission of inaccurate or incomplete reports could result in FDEM ceasing disbursements to the Company, termination of the agreements, or other remedies. Under Florida Statutes, FDEM is responsible for oversight of the operations of the federal award supported activities. Due to the County?s incorrect reporting, FDEM could be reporting incorrect expenditures to the federal agency. RECOMMENDATION: We recommend additional training for consulting staff handling quarterly reports to ensure the correct amounts are being included, and a specific review of quarterly report information by a higher level prior to submission to ensure accurate reporting of project costs. VIEWS OF RESPONSIBLE OFFICIALS: See Management?s Response and Corrective Action Plan beginning page 116.

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