Pulaski County Fiscal CourtLocal Government

CFDA 21.019 Coronavirus Relief Fund Reimbursement/Coronavirus Relief Fund For States Award Number and Year: C078 2020 Name of Federal Agency and Pass-Through Agency: U.S. Department of Treasury and KY Department for Local Government ? Office of Grants Compliance Requirements: Activities Allowed or Unallowed; Allowable Costs/Cost Principles Type of Finding: Significant Deficiency Amount of Questioned Costs: $5,851 The Coronavirus Relief Fund (CRF) was established under section 601 of the Social Security Act to cover costs that are necessary expenditures incurred due to the public health emergency with respect to Coronavirus Disease 2019 (COVID-19). The $150 billion fund is to be used to make payments for specified uses to states, tribal governments, and certain local governments for the program period March 1, 2020 through December 30, 2021. The Compliance Supplement 2020 addendum for Department of the Treasury for CRF for States, Tribal Governments, and Certain Eligible Local Governments states ?recipients may not use payments from the Fund to cover expenditures for which they will receive reimbursement from other sources.? During fiscal year 2020, the Pulaski County Fiscal Court received reimbursements from the CRF for the payroll expenditures that had already been reimbursed by a federal grant or other governmental entities. The Pulaski County Fiscal Court failed to establish effective internal controls over compliance requirements to ensure expenditures submitted for reimbursement from the CRF were not already reimbursed from other sources. We then reviewed reimbursements received from other state and federal grants or other governmental entities for payroll expenditures that had also been reimbursed by CRF. The issue noted appears to be isolated to the CRF grant reimbursements. The deputy county judge/executive stated he was unaware that some of the payroll expenditures submitted by the sheriff?s office for reimbursement under CRF reimbursement contract had already been reimbursed to the sheriff?s office by other entities. The fiscal court received reimbursement for payroll expenditures that had already been reimbursed by other entities. The fiscal court may be required to repay the questioned costs back to the granting agency. 2 CFR ? 200.303 requires a non-federal entity to ?[e]stablish and maintain effective internal control over the Federal award 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.? In addition, 2 CFR ? 200.53 states: ?(a) Improper payment means any payment that should not have been made or that was made in an incorrect amount (including overpayments and underpayments) under statutory, contractual, administrative, or other legally applicable requirements; and (b) Improper payment includes any payment to an ineligible party, any payment for an ineligible good or service, any duplicate payment, any payment for a good or service not received (except for such payments where authorized by law), any payment that does not account for credit for applicable discounts, and any payment where insufficient or lack of documentation prevents a reviewer from discerning whether a payment was proper.? Total known questioned costs are $5,851. Questioned costs were computed by comparing reimbursements received from other state and federal grants or other governmental entities for payroll expenditures to payroll expenditures submitted for reimbursement to Coronavirus Relief Fund (CRF). During testing, we found the following expenditures included that had already been reimbursed: ? $5,619 gross wages were reimbursed for overtime for law enforcement officers from High Intensity Drug Trafficking Area (HIDTA) grant from the United State Office of National Drug Control Policy (ONDCP) ? $232 gross wages were reimbursed for transportation of patients for law enforcement officers from ADANTA. Not a repeat finding. We recommend the fiscal court strengthen internal controls over federal awards to ensure expenditures have not been reimbursed by other entities and are eligible expenditures. We also recommend that the fiscal court contact the Department for Local Government to determine if questioned costs should be repaid or if they can resubmit request with eligible expenditures.