THE CHATTANOOGA HAMILTON COUNTY PUBLIC EDUCATION FOUNDATION INC.Non-Profit

Current Year Findings Finding 2021-001 Information on federal program CFDA 21.019 Coronavirus Relief Funds Criteria Federal regulations require the Organization to spend grant funds in accordance with the Coronavirus Relief Funds grant contract terms regarding allowable costs and subrecipient monitoring.Condition The Organization used grant funds to pay subrecipients when subrecipient payments were not allowed under the Coronavirus Relief Funds grant contract. Questioned costs $818,670Cause Conflicting guidance. Effect The expenditure could result in the Organization having to reimburse the disallowed expenditure. Recommendation Management should ensure that grant expenditures are allowable under the terms of the grant contract. Views of Management Management partially concurs with the finding. Chattanooga/Hamilton County Public Education Fund (the Fund) violated the State?s Terms & Conditions of the award by creating sub-recipients. The Fund submitted the Requests for Funding (RFFs) in question with the understanding obtained through guidance and approval provided to the Fund by the State?s agent that the RFFs in question would be eligible for reimbursement so long as the Fund?s management understood, acknowledged and agreed to specific conditions as documented in a formal attestation document. Although the Terms & Conditions did not allow for sub-recipients, the State recognizes that such prohibition was a state level decision, and not specifically prohibited by CRF guidance or the U.S. Treasury. Because there are no indications that the RFFs in question were submitted to intentionally violate Program Terms & Conditions, the State has agreed to fund the RFFs in question.