Loading...
HomeMy WebLinkAboutCOM 1323.000 2006-2008 CASEY JARMAN tr of N KENNETH G. GOODENOW County Clerk Deputy County Clerk : t COLLEEN SCHRANDT Legislative Auditor Mailing Address: +rE oF•NpN Business Address: (Former County Building) 333 Kilauea Avenue, Second Floor 25 Aupuni Street Ben Franklin Building Hilo, Hawaii 96720 County of Hawai`i Hilo, Hawai'i 96720 Office of the County Clerk Telephone: (808) 961-8255 Facsimile: (808) 961-8912 ` f.. t' July 8, 2008 TO: Council Members of the Finance Committee FROM: Colleen Schrandt y V - Legislative Auditor RE: Single Audit Report for Fiscal Year Ending June 30, 2007 A copy of the Single Audit Report of the County of Hawai `i for Fiscal Year Ending June 30, 2007, is distributed for your information and review. The Single Audit Report was prepared by KPMG LLP as part of the Council's overall audit contract and is not required by the Hawaii County Charter. However, the Single Audit is an audit of the County's basic financial statements and schedule of expenditures of federal awards in accordance with auditing standards generally accepted in the United States of America, as adopted by the American Institute of Certified Public Accountants, issued by the Comptroller General of the United States; and the provisions of the Office of Management and Budget (OMB) Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. The Single Audit Report includes summary reviews of major federal financial assistance programs for the purpose of identifying any material weaknesses in internal controls and testing compliance with certain provisions of laws, regulations, contracts and grants, which could have a direct and material effect on the financial statement. A list of all county programs that have received federal funds can be found on pages 7-16 ("Schedule of Expenditures of Federal Awards"). A "Schedule of Findings and Questioned Costs" can be found on pages 18-20. A "Corrective Action Plan" summary from the Department of Water Supply and Civil Defense Agency for each finding can be found in the beginning of the report. A "Summary Schedule of Prior Audit Findings", which were the findings of last fiscal year, is also located in the beginning of the report. A meeting with the external auditors will be scheduled for the Finance Committee meeting on July 22, 2008 to answer any questions you may have. Enclosures cc w/o enclosures: Ralph Kanetoku, KPMG LLP Department of Finance 12 Department of Water Supply Comm. No. 13 23 Civil Defense Agency Ref, To, G Serving the Interests of the People of Our Island Ref. Dcd Hawaii County is an Equal Opportunity Provider and Employer OFFICE OF THE LEGISLATIVE AUDITOR 08 MAR 25 PM 2: 24 1 1 1 1 1 1 COUNTY OF HAWAII STATE OF HAWAII Single Audit of Federal Financial Assistance Programs Year ended June 30, 2007 CORRECTIVE ACTION PLAN Environmental Protection Agency Passed through the State Department of Health ' Capitalization Grants for Drinking Water State Revolving Funds CFDA No. 66.468 Federal Award No. DW107-0001, DW139-0001, DW109-0001 1 Award Period: N/A Finding 07-01 Davis-Bacon Act - Late Payroll Submission Recommendation: We recommend that the County adhere to Davis-Bacon Act requirements for submission of weekly Certified Copies of Payroll. Project Engineers should review the Daily Log for each project (filed in the project's payroll file), which lists the Certified Copies of Payroll received and ' the date they were received, to monitor the submission of Certified Copies of Payroll each week by contractors/subcontractors. Administration's Comment: The County continues to strive to improve the existing practices by checking the project's Certified Copies of Payroll that are submitted. Adjustments being made by the County are to train other existing staff to track and log incoming reports, review and train project engineers and inspectors on policies and practices implemented by the County, and withhold payments to contractors if reports are not up to date. Anticipated Completion Date: This will be an ongoing effort. t Contact Person: Richard Tsunoda, Waterworks Controller Department of Water Supply Department of Justice, Passed through State Civil Defense State Domestic Preparedness Equipment Programs ' CFDA No. 16.007 Federal Award No.: 2003-TE-TX-0192 Award Period: July 1, 2006 to June 30, 2007 Department of Homeland Security, Passed through the State Department of Defense State Domestic Preparedness Equipment Support Program Law Enforcement Terrorism Prevention Programs CFDA No. 97.004 Federal Award No.: 2004-GE-TF-0042 ' Award Period: July 1, 2006 to June 30, 2007 Emergency Management Program/Law Enforcement Terrorism Prevention Program/ State Homeland Security Program CFDA No. 97.067 Federal Award No.: 2005-GE-T5-0034 ' Award Period: July 1, 2006 to June 30, 2007 Finding 07-02 Reporting - Submission of Quarterly Status Report ' Recommendation: We recommend that the County prepare and submit financial status reports to the State Program Grant Manager on a timely basis. Administration's Comment: The County acknowledges the importance of completing and submitting the financial status reports in a timely manner and will ensure that the reports will be completed and submitted in a timely manner in future periods. Anticipated Completion Date: This will be an ongoing effort. Contact Person: Duane Hosaka, Acting Civil Defense Administrative Officer ' Civil Defense Agency ' Page 1 ' SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS ' Department of Housing and Urban Development Section 8 - Housing Choice Vouchers ' Finding 05-01: We recommend that the case managers/inspectors contact tenants prior to the 30- day repair deadline and/or document their efforts or communications with the tenant/landlord in the tenant's file. Corrected: Procedures have been implemented to improve the notification to tenants of repair deadlines. Training will continue on an ongoing basis. No such instances were noted in the current year. The comment is no longer applicable. Contact person: Edwin S. Taira Housing Administrator Department of Agriculture Water and Waste Disposal Systems for Rural Communities Kona Coastview/Wonderview Water System Finding 05-03: We recommend that the Project Engineers maintain a Payroll Log for each project (filed in the project's payroll file) that lists the Certified Copies of Payroll 1 received and the date they were received. The Payroll Log provides the Project Engineers with an easy way to determine if contractor(s)/subcontractor(s) have been submitting the weekly Certified Copies of Payroll on a timely basis. Using the Payroll Log, the Project Engineers will also ensure that each week is accounted for. Corrective Action Taken: Procedures were developed to better track the weekly ' Certified Copies of Payroll and training continues on an ongoing basis. Contact person: Richard Tsunoda Waterworks Controller Department of Housing and Urban Development Section 8 - Housing Choice Vouchers Finding 06-01: We recommend that the inspectors perform their follow-up inspections to verify that required repairs have been made. ' Corrected: Procedures have been implemented to improve the follow-up inspections. Training will continue on an ongoing basis. No such instances were noted in the ' current year. The comment is no longer applicable. Contact person: Edwin S. Taira ' Housing Administrator Page 1 ' Department of Agriculture Water and Waste Disposal Systems for Rural Communities ' Kona Coastview/Wonderview Water System Finding 06-02: We recommend that the Project Engineers review the Payroll Log for each ' project (filed in the project's payroll file) that lists the Certified Copies of Payroll received and the date they were received. The Payroll Log provides the Project Engineers with an easy way to determine if contractor(s)/subcontractor(s) have been ' submitting the weekly Certified Copies of Payroll on a timely basis. Using the Payroll Log, the Project Engineers will also ensure that each week is accounted for. Corrective Action Taken: Procedures were developed to better track the weekly ' Certified Copies of Payroll and training continues on an ongoing basis. Contact person: Richard Tsunoda Waterworks Controller Page 2 COUNTY OF HAWAII STATE OF HAWAII ' Table of Contents Page 1. INTRODUCTION ' Audit Objectives 1 ' Scope of Audit 2 Organization of Report 2 ' H. COMPLIANCE AND INTERNAL CONTROL OVER FINANCIAL REPORTING 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 3 ' III. COMPLIANCE AND INTERNAL CONTROL OVER FEDERAL AWARDS Report on Compliance with Requirements Applicable to Each Major ' Program and on Internal Control over Compliance in Accordance with OMB Circular A-133 5 ' Schedule of Expenditures of Federal Awards 7 Notes to Schedule of Expenditures of Federal Awards 17 ' Schedule of Findings and Questioned Costs 18 ' SECTION I ' INTRODUCTION 1 i ' KPMG LLP PO Box 4150 Honolulu, HI 96812-4150 January 23, 2008 To the Members of the County Council of Hawaii County of Hawaii Hilo, Hawaii: ' We have completed our audit of the basic financial statements of the County of Hawaii, State of Hawaii (the County), as of and for the year ended June 30, 2007. We have also audited the County's compliance with requirements applicable to its major federal financial assistance programs. We submit herein our reports on compliance and on internal control over financial reporting and over federal awards, a schedule of expenditures of federal awards, and a schedule of findings and questioned costs. The audit objectives and scope of the audit were as follows: AUDIT OBJECTIVES ' 1. To provide opinions on the fair presentation of the County's basic financial statements and the schedule of expenditures of federal awards as of and for the year ended June 30, 2007 in accordance with U.S. generally accepted accounting principles. ' 2. To consider the County's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinions on the basic financial ' statements. 3. To perform tests of the County's compliance with laws, regulations, contracts, and grant agreements that could have a direct and material effect on the determination of financial ' statement amounts. 4. To consider the County's internal control over compliance with requirements that could have a direct and material effect on a major federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance. ' 5. To provide an opinion on the County's compliance with applicable laws, regulations, contracts, and grants that could have a direct and material effect on each major program. 6. To report on the status of prior year findings and questioned costs. ' KPMG LLP, a U.S. limited liability partnership, is the U.S. member firm of KPMG International, a Swiss cooperative. To the Members of the County Council of Hawaii ' County of Hawaii Hilo, Hawaii January 23, 2008 SCOPE OF AUDIT ' We performed an audit of the County's basic financial statements and schedule of expenditures of federal awards as of and for the year ended June 30, 2007, in accordance with auditing standards generally ' accepted in the United States of America, as adopted by the American Institute of Certified Public Accountants; the standards for financial and compliance audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions of U.S. Office of Management and Budget (OMB) Circular A-133, Audits of States, Local Governments, and Non-Profit ' Organizations. ORGANIZATION OF REPORT Our report is organized into three sections as follows: 1. Section I, entitled "Introduction" describes the objectives and scope of our audit and the organization and contents of this report. 2. Section II, entitled "Compliance and Internal Control over Financial Reporting" contains our ' report on the County's internal control over financial reporting and on compliance and other matters based upon our audit of the County's basic financial statements. 3. Section III, entitled "Compliance and Internal Control over Federal Awards" contains our ' report on the County's compliance with requirements applicable to each of its major programs and on the internal control over compliance in accordance with OMB Circular A-133, a schedule of expenditures of federal awards, and a schedule of findings and questioned costs. Our report on the basic financial statements of the County as of and for the year ended June 30, 2007 is included under a separate cover. A separate management letter containing our observations regarding the ' County's internal controls dated December 28, 2007 has also been issued to the County Council. We would like to take this opportunity to express our appreciation to the personnel of the County of Hawaii for the cooperation and assistance extended to us during our audit. We will be pleased to discuss any questions that you or your associates may have regarding our recommendations. Very truly yours, Lrp 2 ' SECTION II COMPLIANCE AND INTERNAL CONTROL ' OVER FINANCIAL REPORTING 1 ' KPMG LLP PO Box 4150 Honolulu, HI 96812-4150 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 To the Members of the ' County Council of Hawaii County of Hawaii Hilo, Hawaii: ' We have audited the financial statements of the governmental activities, the business-type activities, the discretely presented component unit, each major fund, and the aggregate remaining fund information of the County of Hawaii, State of Hawaii (the County), as of and for the year ended June 30, 2007, which collectively comprise the County's basic financial statements, and have issued our report thereon dated December 28, 2007. 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. Internal Control over Financial Reporting In planning and performing our audit, we considered the County's internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing an opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the County's internal ' control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the County's internal control over financial reporting. A control deficiency exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the entity's ability to initiate, authorize, record, process, or report financial data reliably in accordance with U.S. generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the entity's financial statements that is more than inconsequential will not be prevented or detected by the entity's internal control. A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected by the entity's internal control. Our consideration of internal control over financial reporting was for the limited purpose described in the ' first paragraph of this section and would not necessarily identify all deficiencies in internal control that might be significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. 3 KPMG LLP, a U.S. limited liability partnership, is the U.S. member firm of KPMG International, a Swiss cooperative. Compliance and Other Matters As part of obtaining reasonable assurance about whether the County's basic financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those ' provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. ' We noted certain matters that we reported to management of the County in a separate letter dated December 28, 2007. ' This report is intended solely for the information and use of the County Council, the County Administration, federal awarding agencies, and pass-through entities, and is not intended to be and should not be used by anyone other than these specified parties. KPMc, uP December 28, 2007 ' 4 SECTION III COMPLIANCE AND INTERNAL CONTROL OVER FEDERAL AWARDS KPMG LLP PO Box 4150 Honolulu, HI 96812-4150 Report on Compliance with Requirements Applicable to Each Major Program and on Internal Control over Compliance in Accordance with OMB Circular A-133 To the Members of the County Council of Hawaii County of Hawaii Hilo, Hawaii: Compliance We have audited the compliance of the County of Hawaii, State of Hawaii (the County), with the types of compliance requirements described in the U.S. Office of Management and Budget (OMB) Circular A-133 ' Compliance Supplement that are applicable to each of its major federal programs for the year ended June 30, 2007. The County's major federal programs are identified in the summary of auditors' results section of the accompanying schedule of findings and questioned costs. Compliance with the requirements of laws, regulations, contracts, and grants applicable to each of its major federal programs is the responsibility of the County's management. Our responsibility is to express an opinion on the County's compliance based on our audit. i We conducted our audit of compliance in accordance with auditing standards generally 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 OMB Circular A-133, Audits of ' States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 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 includes examining, on a test basis, evidence about the County'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. Our audit does not provide a legal determination of the County's compliance with those requirements. In our opinion, the County complied, in all material respects, with the requirements referred to above that are applicable to each of its major federal programs for the year ended June 30, 2007. However, the results of our auditing procedures disclosed instances of noncompliance with those requirements, which are required to be reported in accordance with OMB Circular A-133 and which are described in the accompanying schedule of findings and questioned costs as Findings 07-01 through 07-02. Internal Control over Compliance ' The management of the County is responsible for establishing and maintaining effective internal control over compliance with the requirements of laws, regulations, contracts, and grants applicable to federal programs. In planning and performing our audit, we considered the County's internal control over compliance with the requirements that could have a direct and material effect on a major federal program ' in order to determine our auditing procedures for the purpose of expressing our opinion on compliance, but ' KPMG LLP, a U.S. limited liability partnership, is the U.S. member firm of KPMG International, a Swiss cooperative. 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 County's internal control over compliance. A control deficiency in an entity's internal control over compliance exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned ' functions, to prevent or detect noncompliance with a type of compliance requirement of a federal program on a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the entity's ability to administer a federal program such that there is more than a ' remote likelihood that noncompliance with a type of compliance requirement of a federal program that is more than inconsequential will not be prevented or detected by the entity's internal control. A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that material noncompliance with a type of compliance requirement of a federal program will not be prevented or detected by the entity's internal control. ' Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and would not necessarily identify all deficiencies in the entity's internal control that might be significant deficiencies or material weaknesses. We did not identify any deficiencies in ' internal control over compliance that we consider to be material weaknesses, as defined above. Schedule of Expenditures of Federal Awards We have audited the financial statements of the governmental activities, the business-type activities, the discretely presented component unit, each major fund, and the aggregate remaining fund information of the County as of and for the year ended June 30, 2007, and have issued our report thereon dated December 28, 2007. Our audit was performed for the purpose of forming opinions on the financial statements that collectively comprise the County's basic financial statements. The accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis as required by OMB Circular A-133 and ' is not a required part of the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole. ' The County's responses to the findings identified in our audit are described in the accompanying schedule of findings and questioned costs. We did not audit the County's response, and accordingly, we express no I opinion on it. This report is intended solely for the information and use of the County Council, the County Administration, federal awarding agencies, and pass-through entities, and is not intended to be and should ' not be used by anyone other than these specified parties. KPMc, LvP January 23, 2008, except for the Schedule of Expenditures of Federal Awards which is as of December 28, 2007 6 COUNTY OF HAWAPI STATE OF HAWAII Schedule of Expenditures of Federal Awards Year ended June 30, 2007 Federal Program CFDA Award Federal Federal Grantor/Pass-Through Grantor/Program Title Number Grant Number Amount Expenditures DEPARTMENT OF AGRICULTURE Rural Development Community Facilities Loans and Grants: Community Facilities Grant - Pahala Extrication Tool 10.766 61-001-099 $ 19,500 $ 18,746 Food and Nutrition Service Passed through the State Department of Education: Summer Food Service Program for Children 10.559 N/A 39,863 39,863 Forest Service Passed through the State Department of Land and Natural Resources: Cooperative Forestry Assistance 10.664 01-DG-11052000-177 50,000 50,000 Rural Utilities Service Kona Coastview/Wonderview Water System 10.760 N/A 5,520,000 808,771 Natural Resources Conservation Service Watershed Protection and Flood Prevention: Wailuku-Alenaio Watershed Kaumana Drive Flood Protection 10.904 65-9251-5-707 360,000 100,000 Wildlife Habitat Incentive Program 10.914 7292515AO56 47,400 6,781 Total Department of Agriculture 1,024,161 DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration Passed through the State Department of Business, Economic Development and Tourism: Coastal Zone Management Administration Awards: Hawaii Coastal Zone Management Program 11.419 NA170Z2333 218,685 3,825 NA03NOS4190082 269,184 20,000 NA04NOS4190038 188,697 7,677 NA05NOS4191060 277,453 60,573 NA06NOS4190159 249,376 124,700 Total Department of Commerce 216,775 7 (Continued) COUNTY OF HAWAII STATE OF HAWAII Schedule of Expenditures of Federal Awards Year ended June 30, 2007 Federal Program CFDA Award Federal Federal Grantor/Pass-Through Grantor/Program Title Number Grant Number Amount Expenditures DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT Office of Housing Section 8 - Housing Assistance Payments Program - Special Allocations: Kulaimano Elderly Housing 14.195 HI 10-0002001 $ 141,019 $ 141,019 Community Planning and Development Community Development Block Grant/Small Cities Program 14.219 B-05-DH-15-0002 2,672,100 2,553,204 B-06-131-1-15-0002 2,417,268 151,946 Program Income - 102,650 Subtotal CFDA 14.219 2,807,800 Passed through the Housing and Community Development Corporation of Hawai `i: HOME Investment Partnerships Program 14.239 M03-SG-150102 2,000,000 262,937 M04-SG-150102 586,413 97,879 M05-SG-150102 1,006,554 114,876 Program Income - 4,348 Subtotal CFDA 14.239 480,040 Public and Indian Housing Section 8 - Housing Choice Vouchers 14.871 H1002VO 11,465,742 11,397,767 Section 8 - Housing Choice Vouchers - FSS Coordinator H1002VOOF01 63,315 58,337 Subtotal CFDA 14.871 11,456,104 Passed through the Department of Hawaiian Home Lands: Native Hawaiian Housing Block Grants - Native American Housing Assistance Self Determination Act 14.873 03NHGHI00I 50,000 3,900 Total Department of Housing and Urban Development 14,888,863 DEPARTMENT OF THE INTERIOR National Park Service Rural Fire Assistance 15.242 H8140060066 19,335 19,335 8 (Continued) COUNTY OF HAWAII STATE OF HAWAII Schedule of Expenditures of Federal Awards Year ended June 30, 2007 Federal Program CFDA Award Federal Federal Grantor/Pass-Through Grantor/Program Title Number Grant Number Amount Expenditures DEPARTMENT OF JUSTICE Office for Domestic Preparedness Passed through State Civil Defense FY 2003 State Domestic Preparedness Equipment Programs 16.007 2003-TE-TX-0192 $ 599,400 $ 342,469 FY 2003 State Domestic Preparedness Training Programs 16.008 2003-MU-T3-0043 2,250,000 494,395 Passed through State Department of Public Safety: Serious and Violent Offender Re-entry Initiative 16.586 02-RE-CX-0032 50,000 11,545 Office of Juvenile Justice and Delinquency Prevention Passed through State Department of Human Services: Juvenile Accountability Incentive Block Grant 16.523 DHS-06-OYS-3112 121,068 72,515 DHS-06-OYS-3112 Sup Agr 23,412 22,554 Subtotal CFDA 16.523 95,069 Title V Delinquency Prevention Program 16.548 DHS-07-OYS4134 88,731 19,541 Office for Victims of Crime Passed through State Department of the Attorney General: Crime Victim Assistance 16.575 03-VA-4 277,719 77,272 04-VA4 304,914 98,001 05-VA4 282,564 81,000 Subtotal CFDA 16.575 256,273 Bureau of Justice Assistance Passed through State Department of Attorney General: Byrne Formula Grant Program: 16.579 Statewide Sexual Assault Multi-Disciplinary Training 03-DB-27 38,850 25,837 Statewide Sexual Assault Multi-Disciplinary Training 03-DB-29 44,502 1,143 Hawaii Narcotics Task Force 04-DB-11 55,500 6,969 Hawaii Narcotics Task Force 04-DB-21 59,199 42,938 Statewide Marijuana Eradication 03-DB-15 172,500 37,755 Statewide Marijuana Eradication 04-DB-22 159,000 147,431 Subtotal CFDA 16.579 262,073 Local Law Enforcement Block Grants Program 16.592 2004-LB-BX-1190 34,467 34,467 9 (Continued) I COUNTY OF HAWAII STATE OF HAWAII Schedule of Expenditures of Federal Awards Year ended June 30, 2007 Federal Program CFDA Award Federal Federal Grantor/Pass-Through Grantor/Program Title Number Grant Number Amount Expenditures Passed through State Department of Attorney General: Weed and Seed Program 16.595 04-DB-15 $ 52,222 $ 46,755 Passed through Young Men's Christian Association: Community Prosecution Program 16.609 2003-GP-CX-0553 16,000 14,116 Edward Byrne Memorial Justice Assistance Grant Program: 16.738 Justice Assistance Grant 2005-DJ-BX-1725 115,645 525 Passed through the State Department of Attorney General: Non-Support Prosecution 05-DJ-12 82,600 39,167 Subtotal CFDA 16.738 39,692 Violence Against Women Office Passed through State Department of the Attorney General: Violence Against Woman Formula Grants: 16.588 Stop Violence Against Women 04-WF-06 49,347 11,111 Stop Violence Against Women 05-WF-07 49,738 43,707 Sexual Assault Forensic Examiners 04-WF-09 42,742 40,779 Sexual Assault Forensic Examiners 05-WT-04 31,322 9,509 Domestic Violence/Sexual Assault 04-WF-08 36,920 19,664 Domestic Violence/Sexual Assault 05-WF-06 40,164 11,863 Subtotal CFDA 16.588 136,633 Office of Community Oriented Policing Services Public Safety Partnership and Community Policing Grants: 16.710 COPS in Schools 2002-SH-WX-0665 750,000 164,446 COPS More 2001-CL-WX-0028 818,306 36,287 Community Oriented Policing Services 20041397 200,000 53,908 Community Oriented Policing Services 20051088 487,474 2,880 Subtotal CFDA 16.710 257,521 Drug Enforcement Administration Marijuana Eradication 2006 N/A 2006-60 341,246 279,436 Marijuana Eradication 2007 2007-63 370,000 97,617 Subtotal for Marijuana Eradication 377,053 Total Department of Justice 2,387,602 10 (Continued) COUNTY OF HAWAII STATE OF HAWAII Schedule of Expenditures of Federal Awards Year ended June 30, 2007 Federal Program CFDA Award Federal Federal Grantor/Pass-Through Grantor/Program Title Number Grant Number Amount Expenditures DEPARTMENT OF LABOR Employment and Training Administration Passed through the State Department of Labor and Industrial Relations: Unemployment Insurance - Title IX Reed Act 17.225 Reed-06-H $ 1,925,556 $ 70,870 Senior Community Service Employment Program 17.235 PY-06-SCSEP-H-HCOA 289,657 288,754 WIA Adult Program 17.258 AA-12007.06-50 545,480 497,508 AA-12007.05-50 630,663 111,302 Subtotal CFDA 17.258 608,810 WIA Youth Activities 17.259 AA-12007.06-50 319,990 260,393 AA-12007.05-50 654,605 335,859 Subtotal CFDA 17.259 596,252 WIA Dislocated Workers 17.260 AA-12007.06-50 554,538 284,316 AA-12007.05-50 446,024 43,440 Subtotal CFDA 17.260 327,756 Total Department of Labor 1,892,442 DEPARTMENT OF TRANSPORTATION Federal Highway Administration Passed through the State Department of Transportation: Highway Planning and Construction: 20.205 Bridge Inspection/Appraisals BR-NBIS(27) 80,000 28,754 Bridge Inspection/Appraisals BR-NBIS(29) 160,000 2,238 Route 2760: Kawailani Street - Iwalani to Pohakulani Street BR-2760(2) 704,000 19,112 Route 2760: Kawailani Street at Waiakea Stream BR-2760(3) 7,598,336 1,226 Flood Damage Repairs at Various County of Hawaii Locations ER-12(9) 1,189,853 11,344 Flood Damage Repairs at Akolea Road Bridge ER-12(12) 339,232 8,248 Ali'i Drive Design/Archaeological RS-0187(4) 6,441,250 28,750 Waimea Regional Circulation Plan SPR-0010(28) 120,000 22,500 Kinoole, Haihai and Komohana Street - Roadside Improvements STP-0100(59) 4,955,670 222,502 Kuakini Highway Improvements -Palani to Hualalai STP-0110(1) 15,892,835 1,342,108 Ali'i Drive Improvements - Hualalai to Walua STP-0186(2) 240,000 13,245 Palani Road Safety Improvements STP-0191(14) 4,073,860 39,572 11 (Continued) COUNTY OF HAWAII STATE OF HAWAII Schedule of Expenditures of Federal Awards Year ended June 30, 2007 Federal Program CFDA Award Federal Federal Grantor/Pass-Through Grantor/Program Title Number Grant Number Amount Expenditures Kilauea Corridor Traffic Signal Upgrade STP-1920(4) $ 2,226,290 $ 32,288 Kinoole Corridor Traffic Signal Upgrade STP-1930(1) 1,759,176 27,822 Puainako Street Extension - Komohana Street to Country Club Road STP-2000(4) 28,730,980 172,068 ADA Curb Ramp Comp Program - Phase III-B (CON) CMAQ-0100(63) 543,462 34,837 ADA Curb Ramp Comp Program - Phase 11-B (CON) CMAQ-0100(64) 633,974 706 Subtotal CFDA 20.205 2,007,320 Federal Transit Administration Passed through the State Department of Transportation: Federal Transit- Capital Investment Grants (5309 Capital Grant) 20.500 HI-03-033 2,057,423 37,833 HI-03-039 2,140,007 36,725 Subtotal CFDA 20.500 74,558 Formula Grants for Other Than Urbanized Areas 20.509 RTAP-FY05 34,000 10,712 HI-18-021 1,100,400 58,894 HI-18-022 535,500 75,927 141-18-023 284,800 6,715 Subtotal CFDA 20.509 152,248 National Highway Traffic Safety Administration State and Community Highway Safety Program: 20.600 Passed through the State Department of Transportation: Deputy Prosecutor Crash Reconstruction Training SA07-08(07-S-01) 33,644 2,056 Deputy Prosecutor and Operating a Vehicle Under the Influence of Intoxicants Training AL06-02(16-H-02) 15,864 12,254 Youth Deterrence Grant AL06-02(08-H-01) 33,000 5,876 Youth Deterrence Grant AL07-02(10-H-01) 27,000 14,577 Roadblock Program AL06-02(01-H-02) 138,700 29,731 Roadblock Program AL07-02(01-H-02) 79,500 33,477 Seatbelt Enforcement OP06-05(01-H-02) 100,000 23,223 Seatbelt Enforcement OP07-05(01-H-02) 109,000 36,821 Click It or Ticket OP06-05(02-H-01) 12,700 216 Click It or Ticket OP07-05(02-H-01) 12,700 1,616 Community Based Traffic Coordinator AL06-02(02-H-01) 59,996 9,740 Community Based Traffic Coordinator AL07-02(02-H-01) 52,000 37,875 12 (Continued) COUNTY OF HAWAII STATE OF HAWAII Schedule of Expenditures of Federal Awards Year ended June 30, 2007 Federal Program CFDA Award Federal Federal Grantor/Pass-Through Grantor/Program Title Number Grant Number Amount Expenditures Speed Enforcement SC06-06(01-H-02) $ 110,364 $ 63,231 Speed Enforcement SC07-06(01-H-02) 50,000 21,665 Traffic Investigation Program PT06-01(03-H-01) 20,560 20,560 Traffic Investigation Program PT07-01(02-H-01) 8,760 4,847 Data Grant TR06-03(03-H-01) 30,000 5,493 Data Grant TR07-03(04-H-01) 30,000 3,600 Generators EM-07-04(01-H-01) 33,299 28,838 Subtotal CFDA 20.600 355,696 Total Department of Transportation 2,589,822 ENVIRONMENTAL PROTECTION AGENCY Office of Water Passed through the State Department of Health: Water Pollution Control Revolving Fund: 66.458 Hawaii County Cesspool Conversion Project NPS006210 8,908,035 4,719,839 Capitalization Grants for Drinking Water State Revolving Funds: 66.468 Kaieie Mauka Exploratory Well DW 107-0001 2,245,936 1,480,879 Makapala Production Well DW139-0001 1,442,301 925,975 Pahala Exploratory Well DW109-0001 539,060 2,982 Subtotal CFDA 66.468 2,409,836 Surveys, Studies, Investigations, and Special Purpose Grants: Waste Reduction and Recycling Project 66.606 X-97998801-1 397,600 106,916 Office of Solid Waste and Emergency Response Brownfields Assessment Cooperative Agreement 66.818 BF-96957001-0 200,000 87,064 Total Environmental Protection Agency 7,323,655 DEPARTMENT OF ENERGY Passed through the State Department of Business, Economic Development and Tourism: State Energy Program: 81.041 Energy Conservation Program DE-FG51-026021337 66,569 61,628 I 13 (Continued) COUNTY OF HAWAII STATE OF HAWAII Schedule of Expenditures of Federal Awards Year ended June 30, 2007 Federal Program CFDA Award Federal Federal Grantor/Pass-Through Grantor/Program Title Number Grant Number Amount Expenditures Energy Efficiency and Renewable Energy Information Dissemination, Outreach, Training, and Technical Analysis/Assistance: 81.117 Geothermal Outreach DE-FG51-04RO21598 $ 95,602 $ 73,095 Total Department of Energy 134,723 FEDERAL EMERGENCY MANAGEMENT AGENCY Passed through the State Department of Defense: Disaster Assistance 83.516 FEMA-1348-DR-HI 670,465 16,962 Public Assistance Grants 83.544 FEMA-1348-DR-HI 5,511,903 18,103 Emergency Management Performance Grants: 83.552 Puukapu Flood Study FIRM Update EMF-2002-GR-0228 300,000 114,217 Total Federal Emergency Management Agency 149,282 DEPARTMENT OF HEALTH AND HUMAN SERVICES Administration on Aging Passed through the State Executive Office on Aging: Special Programs for the Aging: Title III, Part D - Disease Prevention and Health Promotion Services 93.043 313-4-2005 17,091 10,484 3134-2006 16,968 13,322 Subtotal CFDA 93.043 23,806 Title III, Part B - Grants for Supportive Services and Senior Centers 93.044 3134-2006 404,322 176,336 3134-2007 323,654 148,721 Subtotal CFDA 93.044 325,057 Title III, Part C - Nutrition Services 93.045 3C14-2006 236,552 79,542 3C 1-4-2007 269,972 168,608 3C24-2005 111,164 14,817 3C24-2006 109,541 88,399 Subtotal CFDA 93.045 351,366 14 (Continued) COUNTY OF HAWAII STATE OF HAWAII Schedule of Expenditures of Federal Awards Year ended June 30, 2007 Federal Program CFDA Award Federal Federal Grantor/Pass-Through Grantor/Program Title Number Grant Number Amount Expenditures Title III, Part E - Caregiver Program 93.052 3E-4-2005 $ 131,509 $ 32,258 3E-4-2006 130,502 125,472 3E-4-2007 128,176 96,548 Subtotal CFDA 93.052 254,278 Nutrition Services Incentive Program 93.053 N/A 101,057 29,558 N/A 87,867 65,592 Subtotal CFDA 93.053 95,150 Substance Abuse and Mental Health Services Administration Substance Abuse and Mental Health Services - Wahiolanona' opio 93.243 5 H79 TI15338-03 893,987 171,235 Passed through the State Department of Health: Block Grants for Community Mental Health Services - Big Island Juvenile Intake and Assessment Center 93.958 CAMHD 05-009 140,000 79,113 Administration for Children and Families Passed through the State Child Support Enforcement Agency: Child Support Enforcement 93.563 07-04HI4004 662,024 662,024 Centers for Medicare and Medicaid Services Passed through the State Executive Office on Aging: Aging and Disability Resource Center 93.779 ADRC-1-2006 314,600 125,784 Total Department of Health and Human Services 2,087,813 CORPORATION FOR NATIONAL AND COMMUNITY SERVICE Retired and Senior Volunteer Program 94.002 04SRPHI001 84,306 84,306 DEPARTMENT OF HOMELAND SECURITY Passed through the State Department of Defense: State Domestic Preparedness Equipment Support Program - FY 2004 97.004 2004-GE-T4-0042 1,960,060 511,198 Law Enforcement Terrorism Prevention Programs - FY 2004 2004-GE-T4-0042 456,544 318,333 Subtotal CFDA 97.004 829,531 Disaster Grants - Public Assistance (Presidentially Declared Disasters): 97.036 Kiholo Earthquake FEMA-1664-DR-HI 3,360,050 764,808 15 (Continued) COUNTY OF HAWAII STATE OF HAWAII Schedule of Expenditures of Federal Awards Year ended June 30, 2007 Federal Program CFDA Award Federal Federal Grantor/Pass-Through Grantor/Program Title Number Grant Number Amount Expenditures Assistance to Firefighters: 97.044 Plymo-Vent EMW-2005-FG-15741 $ 406,016 $ 406,016 Burn Trailer EMW-2004-FG-08212 301,000 301,000 Subtotal CFDA 97.044 707,016 Passed through the State Department of Defense: Fire Management Assistance Grant - Lalamilo 97.046 FEMA-2573-FM-HI 152,347 152,347 Fire Management Assistance Grant - Akoni Pule FEMA-2574-FM-HI 84,686 84,686 Subtotal CFDA 97.046 237,033 Emergency Management Program - FY 2005 97.067 2005-GE-T5-0034 111,224 26,234 Law Enforcement Terrorism Prevention Program - FY 2005 2005-GE-T5-0034 301,471 33,644 State Homeland Security Program-FY 2005 2005-GE-T5-0034 1,381,742 6,141 Subtotal CFDA 97.067 66,019 Total Department of Homeland Security 2,604,407 U.S. OFFICE OF NATIONAL DRUG CONTROL POLICY Hawaii Impact N/A 16PHIP504Z 107,820 94,529 Total expenditures of federal awards $ 35,497,715 See accompanying notes to schedule of expenditures of federal awards and report on compliance with requirements applicable to each major program and on internal control over compliance in accordance with OMB Circular A-133. 16 COUNTY OF HAWAII STATE OF HAWAII ' Notes to Schedule of Expenditures of Federal Awards Year ended June 30, 2007 (1) Basis of Presentation ' The accompanying schedule of expenditures of federal awards includes the federal grant activity of the County of Hawaii, State of Hawaii (the County). Such schedule is presented on the modified-accrual ' basis of accounting, which is described in note 1 to the County's basic financial statements. The information in this schedule is presented in accordance with the requirements of OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. (2) Subrecipients Of the federal expenditures presented in this schedule, the County provided federal awards to subrecipients ' as follows: Amount CFDA Provided to ' Program Title Number Subrecipients Wildlife Habitat Incentive Program 10.914 $ 6,781 Community Development Block Grant/Small Cities Program 14.219 413,586 ' HOME Investment Partnership Program 14.239 129,623 Juvenile Accountability Incentive Block Grant 16.523 63,500 Title V Delinquency Prevention Program 16.548 9,500 Crime Victim Assistance 16.575 70,771 Weed and Seed Program 16.595 46,755 Workforce Investment Act (WIA): WIA Adult Program 17.258 554,811 ' WIA Youth Activities 17.259 465,272 WIA Dislocated Workers 17.260 300,409 Waste Reduction and Recycling Project 66.606 41,876 Big Island Juvenile Intake and Assessment Center 93.958 74,113 ' 17 ' COUNTY OF HAWAII STATE OF HAWAII ' Schedule of Findings and Questioned Costs Year ended June 30, 2007 (1) Summary of Auditors' Results ' (a) The type of report issued on the basic financial statements: Unqualified opinion (b) Significant deficiencies in internal control which were disclosed by the audit of the basic financial statements: None noted Material weaknesses: None noted ' (c) Noncompliance which is material to the basic financial statements: None noted (d) Significant deficiencies in internal control over major programs: None noted Material weaknesses: None noted (e) The type of report issued on compliance for major programs: Unqualified opinion (f) Any audit findings which are required to be reported under Section .510(a) of OMB Circular A-133: Yes ' (g) Major programs: ' Department of Housing and Urban Development: 14.871- Public and Indian Housing - Section 8 - Housing Choice Vouchers 14.871- Public and Indian Housing - Section 8 - Housing Choice Vouchers - FSS ' Coordinator Department of Justice: ' 16.007 - Office of Domestic Preparedness - State Domestic Preparedness Equipment Programs ' Environmental Protection Agency: 66.468 - Capitalization Grants for Drinking Water State Revolving Funds Department of Homeland Security: 97.004 - State Domestic Preparedness Equipment Support Program/Law Enforcement Terrorism Prevention Programs 97.067 - Emergency Management Program/Law Enforcement Terrorism Prevention Program/State Homeland Security Program (h) Dollar threshold used to distinguish between Type A and Type B programs: $1,064,931 ' (i) Auditee qualified as a low-risk auditee under Section.530 of OMB Circular A-133: Yes 18 (Continued) ' COUNTY OF HAWAPI STATE OF HAWAII ' Schedule of Findings and Questioned Costs Year ended June 30, 2007 (2) Findings Relating to the Basic Financial Statements Performed in Accordance with Government ' Auditing Standards None noted ' (3) Findings and Questioned Costs Relating to Federal Award Finding 07-01- Davis-Bacon Act - Late Payroll Submission Information on the Federal Programs: Environmental Protection Agency, Capitalization Grants for Drinking Water State Revolving Funds - CFDA No. 66.468 ' Specific Requirement: Per review of 29 CFR 5.5(3), the contractor/subcontractor is required to submit to the non-Federal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance. Condition: During our testwork on the Davis-Bacon Act requirements, we noted that the County did not obtain the contractor's/subcontractor's weekly Certified Copies of Payroll on a timely basis. We noted that ' the Certified Copies of Payroll for 27 pay periods selected for testwork were received in the range from two weeks to nine months after the respective pay period ending date. The Daily Log is maintained by Administration and documents all Department of Water Supply's ' incoming mail, including Certified Copies of Payroll. However, if mail is sent directly to Engineering, it may not be logged into the Daily Log if Engineering does not forward the mail to Administration to get logged in the Daily Log. Engineering does not review the Daily Log or keep a separate payroll log for the project to list all the Certified Copies of Payroll received and the date they were received. Questioned Costs: N/A Systemic or Isolated: Systemic Effect: The potential effect of this condition is the laborers and mechanics employed by the ' contractors/subcontractors are not being paid at minimum the prevailing wage rates established for the locality of the project by the Department of Labor. ' Recommendation: We recommend that the County adhere to Davis-Bacon Act requirements for submission of weekly Certified Copies of Payroll. Project Engineers should review the Daily Log for each project (filed in the project's payroll file), which lists the Certified Copies of Payroll received and the date they were received, to monitor the submission of Certified Copies of Payroll each week by contractors/subcontractors. Views of Responsible Officials and Planned Corrective Action: The County continues to strive to ' improve existing practices by checking the project's Certified Copies of Payroll that are submitted. Adjustments being made by the County are to train other existing staff to track and log incoming reports, review and train project engineers and inspectors on policies and practices implemented by the County, ' and withhold payments to contractors if reports are not up to date. 19 (Continued) COUNTY OF HAWAII STATE OF HAWAII ' Schedule of Findings and Questioned Costs Year ended June 30, 2007 Finding 07-02 - Reporting - Submission of Quarterly Status Report Information on the Federal Programs: U.S. Department of Justice, Office for Domestic Preparedness - State Domestic Preparedness Equipment Programs; Department of Homeland Security, State Domestic Preparedness Equipment Support Program/Law Enforcement Terrorism Prevention Programs, Emergency Management Program/Law Enforcement Terrorism Prevention Program/State Homeland Security Program - CFDA Nos. 16.007, 97.004, and 97.067; Federal Award Nos. 2003-TE-TX-0192, ' 2004-GE-T4-0042, and 2005-GE-T5-0034; Award Year: April 1, 2003 to December 31, 2007, December 1, 2003 to November 30, 2007, and October 1, 2004 to March 31, 2008 Specific Requirement: Financial status reports are required to be submitted on a quarterly basis to the State Program Grant Manager no later than the 15th day of the month following the end of the quarter. Condition: During our testwork on reporting, we noted that the financial status reports were not submitted for the quarters ending March 31, 2007 and June 30, 2007, for all three grants. This condition arose as the individual responsible for submitting the financial status reports retired during the fiscal year and this responsibility was not effectively delegated. ' Questioned Costs: N/A Systemic or Isolated: Isolated ' Effect: The State Program Grant Manager is not aware of the expenditures made for the respective grants. Recommendation: We recommend that the County prepare and submit financial status reports to the State Program Grant Manager on a timely basis. Views of Responsible Officials and Planned Corrective Action: The County acknowledges the ' importance of completing and submitting the financial status reports in a timely manner and will ensure that the reports will be completed and submitted in a timely manner in future periods. ' 20