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HomeMy WebLinkAbout2017 Single Audit CITY OF EVANSTON, ILLINOIS Single Audit Reports For the Year Ended December 31, 2017 TABLE OF CONTENTS Independent Auditors’ Report on Schedule of Expenditures of Federal Awards 1-2 Schedule of Expenditures of Federal Awards 3-4 Notes to Schedule of Expenditures of Federal Awards 5-7 Independent Auditors’ Report on Compliance for Each Major Program and on Internal Control over Compliance Required by the Uniform Guidance 8-9 Schedule of Findings and Questioned Costs 10-11 1 INDEPENDENT AUDITORS’ REPORT The Honorable Stephen H. Hagerty, Mayor and Members of the City Council Evanston, Illinois Report on the Schedule of Expenditures of Federal Awards We have audited the accompanying Schedule of Expenditures of Federal Awards (Schedule) of the City of Evanston, Illinois (City), for the year ended December 31, 201 7 and the related notes to the Schedule. Management’s Responsibility for the Schedule of Expenditures of Federal Awards Management is responsible for the preparation and fair presentation of the Schedule in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the Schedule that is free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on the Schedule based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulation Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether the Schedule is free of material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the Schedule. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the Schedule, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the Schedule in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion of the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the Schedule. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. 2 Opinion In our opinion, the Schedule referred to above presents fairly, in all material respects, the respective expenditures of federal awards of the City for the year ended December 31, 201 7 in accordance with accounting principles generally accepted in the United States of America. Report on Other Legal and Regulatory Requirements In accordance with Title 2 U.S. Code of Federal Regulation Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), we have also issued our report dated September 4, 2018, on our consideration of the City’s compliance for each major program and on internal control over compliance required by the Uniform Guidance. The purpose of that report is to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. That report is an integral part of an audit performed in accordance wi th the Uniform Guidance and should be read in conjunction with this report. Chicago, Illinois September 4, 2018 Federal CFDA Identifying Award Passed-Through Federal Number Number Date to Subreceipients Expenditures DEPARTMENT OF AGRICULTURE Passed through the Illinois State Board of Education Child and Adult Care Food Program 10.558 ISBE 13-4225-00 - 05-016-510P-00 January 20, 2016 N/A 54,590 Passed through the Illinois State Board of Education Summer Food Service Program for Children 10.559 ISBE 13-4225-00 - 05-016-510P-00 June 6, 2016 N/A 164,506 Passed through the State of Illinois Department of Public Health Summer Food Inspection Program 10.559 55280014C July 1, 2015 N/A 300 Total Department of Agriculture 219,396 DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT Community Development Block Grants/Entitlement Grants Entitlement year 40 14.218 B14MC-170012 June 18, 2014 72,688 293,941 Entitlement year 41 14.218 B15MC-170012 June 15, 2015 132,108 Entitlement year 42 14.218 B16MC-170012 July 20, 2016 85,599 200,940 Entitlement year 43 14.218 B17MC-170012 October 31, 2017 258,327 1,279,980 Total Community Development Block Grants/Entitlement Grants *416,614 1,906,969 Emergency Solutions Grant Program 14.231 E15MC-17002 June 15, 2015 3,214 3,214 Emergency Solutions Grant Program 14.231 E16MC-17002 July 16, 2016 109,100 113,793 Emergency Solutions Grant Program 14.231 E17MC-17002 October 31, 2017 10,347 10,347 Total Emergency Solution Grant Program 122,661 127,354 Home Investment Partnerships Program 14.239 M14-MC-170218 June 18, 2014 48,265 48,265 Home Investment Partnerships Program 14.239 M15-MC-170218 June 18, 2015 142,089 181,510 Home Investment Partnerships Program 14.239 M16-MC-172018 July 20, 2016 37,256 147,675 Home Investment Partnerships Program 14.239 M17-MC-172018 October 31, 2017 3,606 20,605 Total Home Investment Partnerships Program 231,216 398,055 ARRA - Neighborhood Stabilization Program 14.256 S10-MC-170012 January 14, 2010 N/A 37,641 Total Department of Housing and Urban Development 2,470,019 DEPARTMENT OF JUSTICE Passed through City of Chicago Department of Police 2016 Edward Byrne Memorial Justice Assistance Grant 16.738 2016-DJ-BX-0106 September 7, 2016 N/A 14,685 Passed through Illinois Criminal Justice Information Authority Crime Victim Assistance 16.575 70VFL215245 October 6, 2016 N/A 41,631 Bulletproof Vest Partnership Program 16.607 August 18, 2016 N/A 7,939 Total Department of Justice 64,255 DEPARTMENT OF TRANSPORTATION Highway Planning and Construction 20.205 P-91-301-16 July 27, 2015 N/A 200,751 Highway Planning and Construction 20.205 C-91-467.12 October 7, 2015 N/A 8,171 Highway Planning and Construction 20.205 C-91-248-13 / TE-00D1 (914)February 13, 2013 N/A 1,268 Total Highway Planning and Construction 210,190 Passed through Illinois Department of Transportation State and Community Highway Safety(STEP)20.600 700OP170064/800OP170064 October 5, 2015 N/A 28,976 State and Community Highway Safety(STEP)20.600 700OP170064/800OP18007 October 1, 2016 N/A 5,830 Total State and Community Highway Safety(STEP)34,806 Safe Routes to School Speed Feedback Signs 20.205 C-91-029-16 November 17, 2014 N/A 18,528 Bike Parking Project at Main Street CTA Station 20.205 C-91-118-17 N/A 5,796 Total Department of Transportation 269,320 DEPARTMENT OF ENVIRONMENTAL PROTECTION AGENCY Passed through the Illinois Department of Public Health Beach Monitoring and Notification Program Implementation Grant 66.472 75380200E July 1, 2016 N/A 8,295 Total Department of Environmental Protection Agency 8,295 CITY OF EVANTSON, ILLINOIS SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS For the Year Ended December 31, 2017 Federal Grantor/Pass-Through Grantor/ Program Title * = Denotes a major program See Accompanying Notes to Schedule of Expenditures of Federal Awards, 3 Federal CFDA Identifying Award Passed-Through Federal Number Number Date to Subreceipients Expenditures CITY OF EVANTSON, ILLINOIS SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS For the Year Ended December 31, 2017 Federal Grantor/Pass-Through Grantor/ Program Title DEPARTMENT OF HEALTH AND HUMAN SERVICES Passed through Suburban Area Agency on Aging Special Programs for the Aging Title III, Part B Grants for Supportive Services and Senior Centers 93.044 B3 OMB/T3BO Ombudsman December 20, 2016 N/A 54,620 Special Programs for the Aging Title III Part C Nutrition Services 93.045 T3C1 September 26, 2016 N/A 42,196 Senior Health Insurance Program 93.045 SHIP171813 May 30, 2017 N/A 1,183 Passed through the Illinois of Department of Public Health Public Health Emergency Preparedness 93.074 5NU90TP000520-05-00 AGREEMT 77180027E July 1, 2016 N/A 54,021 Cities Readiness Initiative 93.074 5NU90TP000520-50-00 AGREEMT 77180103E July 1, 2016 N/A 40,822 Passed through Public Health Institute of Metropolitan Chicago 93.940 April 25, 2017 N/A 3,470 HIV Region 8 Prevention Services Total Department of Health and Human Services 196,312 DEPARTMENT OF HOMELAND SECURITY Passed through the Illinois Emergency Management Agency Emergency Management Performance Grants 97.042 EMW-2015-FO-04058 August 20, 2016 N/A 221,091 Total Department of Homeland Security 221,091 NATIONAL ENDOWMENT OF THE ARTS Promotion of the Arts 45.024 19926 April 21, 2017 N/A 8,980 Pass thru Museum and Library Science to Loyola University STEMeX 45.312 MG-77-16-0118-16 December 1, 2016 N/A 37,343 Total National Endowment of the Arts 46,323 NATIONAL FISH AND WILDLIFE FOUNDATION Migratory Bird Habitat 15.663 2005.16.054554 December 16, 2016 N/A 32,985 Total National Fish and Wildlife Foundation 32,985 Total Expenditures of Federal Awards 3,527,996$ * = Denotes a major program See Accompanying Notes to Schedule of Expenditures of Federal Awards, 4 CITY OF EVANSTON, ILLINOIS NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS For the Year Ended December 31, 2017 5 NOTE 1 – REPORTING ENTITY This report on Federal Awards includes the federal awards of the City of Evanston, Illinois. The reporting entity for the city is based upon criteria established by the Governmental Accounting Standards Board (GASB). The City of Evanston is the primary government according to GASB criteria. On April 30, 2014, the Township was discontinued and dissolved following March 18, 2014 general election vote taken by the registered voters of the Evanston Township. Pursuant to 60 ILCS 1/27-15 and 1/27-20, effective 12:00 a.m. May 1, 2014, the City of Evanston assumed all rights, powers, assets, property, obligations and duties of the Evanston Township, including the responsibilities of providing the services that were previously provided by the Township. Beginning May 1, 2014, the functions of the Township are reported along with the City. NOTE 2 – BASIS OF PRESENTATION The accounting records for some grant programs are maintained on the modified accrual bas is of accounting. Under the modified accrual basis, revenues are recorded when susceptible to accrual, i.e., both measurable and available. Available means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Expenditures are recorded when the liability is incurred. The accounting records for other grant programs are maintained on the accrual basis, i.e., when the revenue has been earned and the liability is incurred. The information in this schedule is presented in accordance with the requirements of OMB Uniform Guidance. NOTE 3 – SUBRECIPIENTS Of the federal expenditures presented in the schedule of expenditures of federal awards, the City of Evanston provided federal awards to subrecipients as follows: Program Title Federal CFDA Number Amount Provided to Subrecipients Community Development Block Grants/Entitlement Grants 14.218 $416,614 Emergency Solutions Grant Program 14.231 $122,661 HOME Investment Partnerships Program 14.239 $231,216 CITY OF EVANSTON, ILLINOIS NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS For the Year Ended December 31, 2017 6 NOTE 4 – PROGRAM INCOME The City of Evanston received the following program income amounts for the year ended December 31, 2017. The balances of receipts are from letter of credit drawdowns for the program. The program expenditures for the year include expenditures of this program income. Program Title Federal CFDA Number Amount Community Development Block Grants/Entitlement Grants 14.218 $117,004 Home Investment Partnerships Program 14.239 $27,509 NOTE 5– NOTES RECEIVABLE OUTSTANDING The City of Evanston has several notes receivable outstanding as of December 31, 2017. These loans are for various uses. The Community Development Block Grants/Entitlement Grants Loan funds a number of programs to make decent housing available and affordable to low- and moderate-income families, and to help low- and moderate-income residents maintain their property. The Home Investment Partnerships Program Loan provides loans to housing developers to acquire, rehab or construct housing for low and moderate income households. Program Title Federal CFDA Number Amount Community Development Block Grants/Entitlement Grants 14.218 $1,830,122 Home Investment Partnerships Program 14.239 $5,008,706 The notes receivable balances are not subject to continuing OMB Uniform Guid ance compliance requirements. NOTE 6– LOANS PAYABLE OUTSTANDING The City of Evanston has the following loans payable outstanding as of December 31, 2017. These loans are from The Capitalization Grants for Drinking Water and Clean Water State Revolving Funds. Projects funded were the sewer lining at Emerson and Davis streets, rehab of large diameter sewers and rehab of the Cleveland street sewer. CITY OF EVANSTON, ILLINOIS NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS For the Year Ended December 31, 2017 7 NOTE 6– LOANS PAYABLE OUTSTANDING - Continued Program Title Federal CFDA Number Amount Capitalization Grants for Drinking Water State Revolving Funds 66.468 $381,656 Capitalization Grants for Clean Water State Revolving Funds 66.458 $958,972 The loan payable balances are not subject to continuing OMB Uniform Guidance compliance requirements. NOTE 7 – NONCASH ASSISTANCE Of the federal expenditures presented in the schedule of expenditures of federal awards, the City of Evanston did not receive any noncash assistance during the year ended December 31, 2017. NOTE 8 – FEDERAL INSURANCE The City of Evanston had no federal insurance for the year ended December 31, 2017. NOTE 9 – INDIRECT COST RATE The City of Evanston has not elected to use the 10% de minimis indirect cost rate. 8 INDEPENDENT AUDITORS’ REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE The Honorable Stephen H. Hagerty, Mayor and Members of the City Council Evanston, Illinois Report on Compliance for Each Major Federal Program We have audited the City of Evanston, Illinois (City) compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on the City’s major federal programs for the year ended December 31, 2017. The City’s major federal programs are identified in the summary of auditors’ results section of the accompanying schedule of findings and questioned costs. Management’s Responsibility Management is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs. Auditor’s Responsibility Our responsibility is to express an opinion on compliance for the City’s major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards general ly accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulation Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit inc ludes examining, on a test basis, evidence about the City’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the City’s compliance. 9 Opinion on Each Major Federal Program In our opinion, the City complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended December 31, 2017 . Report on Internal Control over Compliance Management of the City is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the City’s internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control over compliance. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal cou rse of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combinati on of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose. Chicago, Illinois September 4, 2018 CITY OF EVANSTON, ILLINOIS SCHEDULE OF FINDINGS AND QUESTIONED COSTS For the Year Ended December 31, 2017 10 SECTION I – SUMMARY OF AUDITORS’ RESULTS Financial Statements 1) Type of report the auditor issued on whether the financial statements audited were prepared in accordance with GAAP : Unmodified 2) Internal control over financial reporting: • Material weakness(es) identified? Yes X No • Significant deficiency(ie s) identified? X Yes None reported 3) Noncompliance material to financial statements noted? Yes X No Federal Awards 1) Internal control over major federal programs: • Material weakness(es) identified? Yes X No • Significant deficiency(ies) identified? Yes X None reported 2) Type of auditors’ report issued on compliance for major federal programs: Unmodified 3) Any audit findings disclosed that are required to be reported in accordance with 2 CFR 200.516(a)? Yes X No Identification of major programs: CFDA Number Name of Federal Program or Cluster 14.218 Community Development Block Grants/Entitlement Grants Dollar threshold used to distinguish between type A and type B Programs: $750,000 Auditee qualified as low risk auditee? Yes X No CITY OF EVANSTON, ILLINOIS SCHEDULE OF FINDINGS AND QUESTIONED COSTS For the Year Ended December 31, 2017 11 SECTION II – FINANCIAL STATEMENT FINDINGS See finding #2017-01 in the separate report titled “Independent Auditor’s Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards”. SECTION III – FEDERAL AWARDS FINDINGS AND QUESTIONED COSTS No matters were reported. SECTION IV – PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS None.