REPORT TO COUNCIL
SUBJECT
Title
Action on the City of Santa Clara Federally Funded Grants’ Single Audit Report for Fiscal Year Ended June 30, 2024
Report
COUNCIL PILLAR
Enhance Community Engagement and Transparency
BACKGROUND
The City’s annual financial statement audit includes a federally mandated “Single Audit”, which is designed to meet the special reporting requirements of federal granting agencies. These include the Office of Management and Budget’s (OMB) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (formerly OMB A-133), which are found in Title 2 CFR Part 200. Title 2 CFR Part 200 establishes uniform administrative requirements, cost principles, and audit requirements for Federal awards to non-Federal entities. The Single Audit rules require that an independent audit be completed on the fair presentation of the financial statements and internal controls for compliance with the administrative requirements of federal awards for agencies with more than $750,000 of federal grant expenditures in a fiscal year. Since the City met this $750,000 threshold, the City hired Maze & Associates to conduct the audit. The Single Audit report is attached.
On March 17, 2025, City staff and Maze & Associates met with the City Council Audit Committee (Committee), which included Committee members Hardy, Gonzalez and Chahal. During the Committee meeting, Maze & Associates gave a presentation about the audit process, scope of work, and their auditor’s opinion. City staff and Maze & Associates answered questions from Committee members.
The Committee unanimously accepted the Single Audit Report presented at the Committee meeting and recommended that the City Council note and file the report at the Mach 25, 2025 City Council meeting. After the City Council meeting, the Single Audit Report will be published on the City’s website.
DISCUSSION
Attached is the Single Audit report for FY 2023-24 (Attachment 1). Maze & Associates identified the Homeland Security (Staffing for Adequate Fire and Emergency Response Grant) and the California Governor’s Office of Emergency Services Pass-Through Disaster Grant for Public Assistance as the major programs to audit. The Single Audit yielded an unmodified or clean opinion. The financial statement audit also yielded an unmodified or clean opinion, however there was a financial statement finding regarding internal control over financial reporting. This was corrected through the year-end financial statement process in September 2024 as noted in the Corrective Action Plan (attachment 2).
Additionally, the Single Audit rules also require the City to report on the status of any audit findings that were identified during the previous year. The Single Audit for FY 2022-23 resulted in a finding related to noncompliance with timely expenditure requirements under the Community Development Block (CDBG) program. The City’s line of credit for the CDBG program was more than 1.5 times the then most recent entitlement grant. The actions staff have taken, and the status of the prior year finding are outlined in the attached Summary Schedule of Prior Audit Findings (attachment 3).
ENVIRONMENTAL REVIEW
The action being considered does not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to section 15378(b)(5) of Title 14 of the California Code of Regulations in that it is an administrative activity that will not result in direct or indirect physical changes in the environment.
FISCAL IMPACT
The staff and the external auditor costs associated with the audit and financial reports production are included in the annual budget.
PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email clerk@santaclaraca.gov or at the public information desk at any City of Santa Clara public library.
RECOMMENDATION
Recommendation
Note and file the City of Santa Clara Single Audit Report for the year ended June 30, 2024, as recommended by the City Council Audit Committee.
Staff
Reviewed by: Kenn Lee, Director of Finance
Approved by: Jovan D. Grogan, City Manager
ATTACHMENTS
1. Single Audit Report June 30, 2024
2. Single Audit Current Year Finding - Corrective Action Plan
3. Summary Schedule of Prior Year Finding