Town of Gilbert, Arizona

Finding Number: 2023‐001 Repeat Finding: No Program Name/Assistance Listing Title: CDBG – Entitlement Grants Cluster Assistance Listing Number: 14.218 Federal Agency: Department of Housing and Urban Development Federal Award Number: N/A Pass‐Through Agency: N/A Questioned Costs: N/A Type of Finding: Noncompliance, Significant Deficiency Compliance Requirement: Reporting Criteria Under 2 CFR §200.303, the Town is required to establish and maintain effective internal controls over Federal awards that provide reasonable assurance that the Town is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Further, under the requirements of the Federal Funding Accountability and Transparency Act (Pub. L. No. 109‐282), as amended by Section 6202 of Pub. L. No. 110‐252, that are codified in 2 CFR Part 170, direct recipients of grants or cooperative agreements are required to report first‐tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Condition The  Town  did  not  report  first‐tier  subawards  of  $30,000  or  more  to  the  FSRS  as  required  by  the  Transparency Act. Cause The Town was unaware that such subawards were required to be reported through the FSRS. Effect The Town was not in full compliance with federal reporting requirements. Context During fiscal year 2023, the Town made four first‐tier subawards of over $30,000 to subrecipients. The Town did not report any of the subawards to the FSRS. The sample was not intended to be, and was not, a statistically valid sample. Recommendation The  Town  should  implement  controls  and  procedures  to  ensure  that  all  federal  reporting  requirements are tracked and necessary reports submitted. Views Of Responsible Officials See Corrective Action Plan.