Single Audit Report, 2011-12

COUNTY OF SAN LUIS OBISPO SINGLE AUDIT REPORT YEAR ENDED JUNE 30, 2012 THIS PAGE INTENTIONALLY LEFT BLANK COUNTY OF SAN LUIS OBISPO Single Audit Report For the Year Ended June 30, 2012 Table of Contents Page 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 ......................................................................................................................................... 1-2 Independent Auditor’s Report on Compliance with Requirements that Could Have a Direct and Material Effect on Each Major Program and on Internal Control Over Compliance in Accordance with OMB Circular A-133 ................................................ 3-4 Schedule of Expenditures of Federal Awards .................................................................................... 5-11 Notes to Schedule of Expenditures of Federal Awards ..................................................................... 12-14 Schedule of Findings and Questioned Costs ..................................................................................... 15-17 Summary Schedule of Prior Audit Findings ....................................................................................... 19-22 Supplementary Schedule of Grant Expenditures ............................................................................... 23-24 Aviation Passenger Facilities Charges Independent Auditor’s Report on Schedule of Passenger Facility Charges, Revenues, and Expenses .................................................................................... 25 Report on Compliance with Requirements Applicable to the Passenger Facility Charges Program on Internal Control Over Compliance ..................................................... 27-28 Report on Compliance and on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Schedule of Passenger Facility Charges, Revenues, and Expenses Performed in Accordance with Government Auditing Standards .......................................................................... 29-30 Schedule of Passenger Facility Charges (PFC), Revenues, and Expenses……………………………………………………………………………………………………. 31 THIS PAGE INTENTIONALLY LEFT BLANK 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 Board of Supervisors County of San Luis Obispo San Luis Obispo, California 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 San Luis Obispo (County), as of and for the year ended June 30, 2012, which collectively comprise the County’s basic financial statements and have issued our report thereon dated December 28, 2012. We conducted our audit in accordance with auditing standards 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. Our report was modified to include a reference to other auditors. Other auditors audited the financial statements of the San Luis Obispo County Pension Trust Fund and the First 5 San Luis Obispo County, a discretely presented component unit, as described in our report on the County’s financial statements. This report does not include the results of the other auditors’ testing of internal control over financial reporting or compliance and other matters that are reported separately by those auditors. 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 our 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 deficiency in internal control 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 and correct misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the County’s financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of internal control over financial reporting 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 financial reporting that might be deficiencies, 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. Compliance and Other Matters As part of obtaining reasonable assurance about whether the County’s 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. 1 925 Highland Pointe Drive, Suite 450, Roseville, CA 95678-5418 tel: 916.784.7800 fax: 916.784.7850 www.gallina.com Board of Supervisors County of San Luis Obispo This report is intended solely for the information of management, the Board of Supervisors, and 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. Roseville, California December 28, 2012 2 INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE WITH REQUIREMENTS THAT COULD HAVE A DIRECT AND MATERIAL EFFECT ON EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133 Board of Supervisors County of San Luis Obispo San Luis Obispo, California Compliance We have audited the compliance of the County of San Luis Obispo (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, 2012. The County’s major federal programs are identified in the summary of auditor’s 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. 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 on the County’s compliance with those requirements. In our opinion, the County of San Luis Obispo complied, in all material respects, with the requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2012. Internal Control Over Compliance The management of the County is responsible for establishing and maintaining effective internal control over compliance with 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 and to test and report on internal control over compliance in accordance with OMB Circular A-133, 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 County’s internal control over compliance. 3 925 Highland Pointe Drive, Suite 450, Roseville, CA 95678-5418 tel: 916.784.7800 fax: 916.784.7850 www.gallina.com Board of Supervisors County of San Luis Obispo 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 course 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 combination of deficiencies, in internal control over compliance, such that there is 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. 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 deficiencies, 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, 2012, and have issued our report thereon dated December 28, 2012. We did not audit the financial statements of the San Luis Obispo County Pension Trust Fund and the First 5 San Luis Obispo County, a discretely presented component unit. Those financial statements were audited by other auditors whose reports have been furnished to us, and our opinions, insofar as it relates to the amounts included in the Pension Trust Fund and the discretely presented component unit is based on the reports of the other auditors. 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 is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the basic financial statements as a whole. The Supplementary Schedules of Grant Expenditures have not been subjected to auditing procedures applied in the audit of the basic financial statements, and accordingly, we express no opinion on them. This report is intended solely for the information and use of management, the Board of Supervisors, and 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. Roseville, California December 28, 2012 4 COUNTY OF SAN LUIS OBISPO, CALIFORNIA Schedule of Federal Financial Assistance For the Year Ended June 30, 2012 Federal Pass-Through 2011-2012 CFDA Grantor's Revenue 2011-2012 Federal Grantor/Pass-Through Grantor/Program Title Number Number Recognized Expenditures U. S. DEPARTMENT OF AGRICULTURE Direct Programs: Federal Forest Reserve 10.665 -- $ 6,676 $ 6,676 Water and Waste Disposal Program-Grant 10.760 -- 63,876 63,876 ARRA - Water and Waste Disposal Program 10.781 -- 6,687,130 6,687,130 Subtotal Direct 6,757,682 6,757,682 Passed through State Department of Social Services: Food Stamp Administration 10.561 -- 3,399,226 3,400,120 Food Stamp Administration-Prior year adjustment 10.561 -- 99,631 99,631 Subtotal Pass-Through 3,498,857 3,499,751 Passed through State Department of Health Care Services: Women Infant Children Nutrition Program 10.557 11-10453 934,293 919,293 Women Infant Children Nutrition Program 10.557 08-85431 409,953 409,953 Women Infant Children Nutrition Program -Prior year adjustment 10.557 08-85431 (40,064) (40,064) Subtotal Pass-Through 1,304,182 1,289,182 Passed through California Fire Safe Council: Cooperative Forestry Assistance 10.664 7FG-10091 52,963 52,963 Subtotal Pass-Through 52,963 52,963 Passed through State Dept of Food and Agriculture Pest Detection Trapping 10.025 10-8520-1399CA 10-8520-0934GI 182,962 182,962 Pest Detection Trapping - Prior Year Adjustment 10.025 10-8520-1399CA 10-8520-0934GI 223 223 Sudden Oak Death 10.025 11-0336-SF 19,060 19,060 Glassy-Winged Sharpshooter 10.025 10-0349 423,231 423,231 Glassy-Winged Sharpshooter - Prior year adjustment 10.025 10-0349 200 200 Asian Citrus Psyllid Detection 10.025 10-0074-SF, 11-0537-SF 133,321 133,321 Asian Citrus Psyllid Detection - Prior Year Adjustment 10.025 10-0074-SF, 11-0537-SF 9,681 9,681 European Grape Vine Moth 10.025 11-0255-SF, 11-0553-SF 152,344 152,344 Light Brown Apple Moth Regulatory 10.025 11-0371-SF, 11-0427-SF, 11-0564 74,005 74,005 Light Brown Apple Moth Regulatory - Prior Year Adjustment 10.025 11-0371-SF, 11-0427-SF, 11-0564 2,157 2,157 Light Brown Apple Moth Detection 10.025 11-0277-SP, 11-0419-SF, 11-0510-SF 17,096 17,096 Light Brown Apple Moth Detection - Prior Year Adjustment 10.025 11-0277-SP, 11-0419-SF, 11-0510-SF 2,104 2,104 Subtotal Pass-Through 1,016,384 1,016,384 Passed through State Department of Public Health: Supplemental Nutrition Assistance Program Education (SNAP-ED) 10.561 -- 123,978 123,978 Subtotal Pass-Through 123,978 123,978 Total Dept. of Agriculture $ 12,754,046 $ 12,739,940 U.S. DEPARTMENT OF DEFENSE Direct programs: Community Economic Adjustment Planning Assistance for Joint Land Use Studies 12.610 HQ00051110021 87,416 87,416 Total Department of Defense $ 87,416 $ 87,416 U. S. DEPT OF HOUSING & URBAN DEVELOPMENT Direct programs: Community Devel. Block Grants 14.218 B-06-UC-06-0508 287,005 287,005 Community Devel. Block Grants 14.218 B-07-UC-06-0508 102,660 102,660 Community Devel. Block Grants 14.218 B-09-UC-06-0508 697,519 697,519 Community Devel. Block Grants 14.218 B-10-UC-06-0508 543,846 543,846 Community Devel. Block Grants 14.218 B-11-UC-06-0508 872,982 872,982 Community Devel. Block Grants - 3rd Party Loans 14.218 -- 2,493,886 Emergency Solutions Grant Program 14.231 E-11-UC-06-0508 91,683 91,683 Supportive Housing Program 14.235 CA0737-41BD141002-3 707,390 707,385 Supportive Housing Program 14.235 CA0737-41B9D14801-2 206,458 206,458 Home Partnership Investment Program 14.239 M-09-UC-06-0545 45,346 45,346 Home Partnership Investment Program 14.239 M-10-UC-06-0545 35,000 35,000 Home Partnership Investment Program 14.239 M-11-UC-06-0545 125,322 125,322 Home Partnership Investment Program-3rd Party Loans 14.239 -- 14,289,892 See accompanying Notes to Schedule of Expenditures of Federal Awards. 5 COUNTY OF SAN LUIS OBISPO, CALIFORNIA Schedule of Federal Financial Assistance For the Year Ended June 30, 2012 Federal Pass-Through 2011-2012 CFDA Grantor's Revenue 2011-2012 Federal Grantor/Pass-Through Grantor/Program Title Number Number Recognized Expenditures U. S. DEPT OF HOUSING & URBAN DEVELOPMENT (continued) Direct programs (continued): ARRA - Community Development Block Grants 14.253 B-09-UY-06-0508 $ 82,217 $ 82,217 ARRA - Community Development Block Grants 14.253 B-09-UY-06-0508 4,755 4,755 ARRA - Homelessness Prevention & Rapid Rehousing (HPRP) 14.257 S-09-UY-06-0508 224,037 224,037 Subtotal Direct 4,026,220 20,809,993 Passed through State Department of Public Health Housing Opportunities for Persons With Aids-Development 14.241 10-10143 160,893 160,893 Subtotal Pass-Through 160,893 160,893 Total Dept. of Housing & Urban Development $ 4,187,113 $ 20,970,886 U. S. DEPT OF THE INTERIOR Direct program: Payments In-Lieu of Taxes 15.226 -- 1,069,926 1,069,926 Coastal Impact Assistance Program 15.668 F12AF-70129,70175-6,70278,70233 97,181 97,181 Subtotal Direct 1,167,107 1,167,107 Passed through Department of Fish & Game Cooperative Endangered Species Conservation Fund 15.615 P1182017, P1182018 50,082 104,031 Subtotal Pass-Through Fish & Game 50,082 104,031 Passed through California Bureau of Land Management Taylor Grazing Act 15.227 -- 5,999 89 Subtotal Pass-Through Bureau of Land Management 5,999 89 Passed through California State Department of Parks & Recs Outdoor Recreation Acquisition - Los Osos Playground 15.916 06-01704 11,998 11,998 Subtotal Pass-Through 11,998 11,998 Total Dept. of Interior $ 1,235,186 $ 1,283,225 U. S. DEPT OF JUSTICE Direct programs: Bureau of Immigration & Customs Enforcement-Prior year adjustment 16.710 -- 10,588 10,588 SS Awards 16.710 -- 53,760 53,760 Byrne Memorial-DNA Forensic Lab 16.580 2008-DD-BX-0306 48,814 48,814 State Criminal Alien Assistance Program 16.606 -- 379,490 379,490 Southwest Border Prosecution Initiative 16.607 -- 3,336 3,336 Southwest Border Prosecution Initiative-Prior Year adjustment 16.607 -- 19,165 19,165 Justice Assistance Grant 16.738 2010-DJ-BX-1240 1,104 1,104 Justice Assistance Grant 16.738 2011-DJ-BX-2288 19,600 19,600 Coverdell Forensic Science Improvement Grant 16.742 2011-91301-CA-CD 140,474 139,169 Federal Asset Forfeiture 16.000 -- 281,974 281,974 ARRA - BJA Recovery Act 16.804 2009-SB-B9-2615 10,010 10,010 Subtotal Direct 968,315 967,010 Passed through California Emergency Management Agency: Gang Task Force 16.579 DC11 22 0400 156,244 156,244 Victim Witness Assistance 16.575 VW11300400 87,120 87,120 Victim (Elder) Adovocacy Outreach 16.582 UV100200400 122,696 125,000 Victim Witness Elder Abuse - Prior Year Adjustment 16.582 UV100200400 (90,797) (90,797) ARRA - Project Safe Neighborhoods 16.609 US10010400 3,615 3,615 ARRA - Justice Assistance Grant - Evidence Based Practices Supervision 16.803 ZP09010400 238,765 226,915 ARRA - Justice Assistance Grant - Comprehensive Drug Court Initiative 16.803 DI10010400 138,082 138,082 ARRA - Justice Assistance Grant - Offender Treatment Program 16.803 ZO09010400 43,361 43,361 Subtotal Pass-through 699,086 689,540 Passed through State Dept of Corrections & Rehabilitation: Juvenile Accountability Block Grant 16.523 CSA 166-11 23,936 23,936 Training -Prior Yr Adj 16.523 CSA 166-09 AMYVPT 1 1 Subtotal Pass-through 23,937 23,937 Total Dept. of Justice $ 1,691,338 $ 1,680,487 See accompanying Notes to Schedule of Expenditures of Federal Awards. 6 COUNTY OF SAN LUIS OBISPO, CALIFORNIA Schedule of Federal Financial Assistance For the Year Ended June 30, 2012 Federal Pass-Through 2011-2012 CFDA Grantor's Revenue 2011-2012 Federal Grantor/Pass-Through Grantor/Program Title Number Number Recognized Expenditures U. S. DEPARTMENT OF LABOR Passed through California Employment Development Department: ARRA - Workforce Investment Act-Disability Prg Navigator-ARRA 17.207 K078487 $ 174 $ 174 Prior Year Adjustment 17.207 K078487 2,115 2,115 Workforce Investment Act-Adult 17.258 K178693, K282503 798,380 798,380 Workforce Investment Act-Youth 17.259 K178693, K282503 1,071,957 1,071,957 Workforce Investment Act-National Emergency Grants 17.277 50,147 50,147 Workforce Investment Act-Dislocated Worker & Rapid Response 17.278 K178693, K282503 869,139 869,139 Subtotal Pass-through 2,791,912 2,791,912 Total Dept. of Labor $ 2,791,912 $ 2,791,912 U. S. DEPARTMENT OF TRANSPORTATION Direct program: Airport Improvement Program 20.106 3-06-0228-39 223,343 223,343 Airport Improvement Program 20.106 3-06-0228-38 1,470 1,470 Airport Improvement Program - Prior Year Adjustment 20.106 3-06-0228-23 132,379 132,379 Subtotal Direct 357,192 357,192 Passed through State Department of Transportation: Public Ways and Facilities 20.205 BHLS-5949(062) 832,619 832,619 Public Ways and Facilities 20.205 BHLS-5949(063) 518,170 518,170 Public Ways and Facilities 20.205 BRLO-5949(019) 1,471,566 1,471,566 Public Ways and Facilities 20.205 BRLO-5949(009) 1,186,247 1,186,247 Public Ways and Facilities - Prior Year Adjustment 20.205 BRLO-5949(009) (751) (751) Public Ways and Facilities 20.205 BRLO-5949(065) 228,397 228,397 Public Ways and Facilities 20.205 BRLO-5949(116) 94,476 94,476 Public Ways and Facilities 20.205 BRLO-5949(119) 82,430 82,430 Public Ways and Facilities 20.205 BRLO-5949(120) 7,491 7,491 Public Ways and Facilities 20.205 BRLO-5949(127) 45,680 45,680 Public Ways and Facilities 20.205 BRLS-5949(129) 250 250 Public Ways and Facilities 20.205 BRLS-5949(131) 4,410 4,410 Public Ways and Facilities 20.205 BRLS-5949(135) 6,267 6,267 Public Ways and Facilities 20.205 HP21L-5949(126) 97,086 97,086 Public Ways and Facilities -Prior year adjustment 20.205 HP21L-5949(126) 17,742 17,742 Public Ways and Facilities 20.205 Q101(189) 6,089,907 6,089,907 Public Ways and Facilities 20.205 BPMPL 5949 (113) 173,502 173,502 Public Ways and Facilities 20.205 BPMPL 5949 (124) 52,345 52,345 Public Ways and Facilities 20.205 BPMPL 5949 (130) 15,344 15,344 National Scenic Byways 20.205 CASB-5949(105) 7,194 7,194 Subtotal Pass-through 10,930,370 10,930,371 Total Dept. of Transportation $ 11,287,562 $ 11,287,563 INSTITUTE OF MUSEUM AND LIBRARY SERVICES Passed through California State Library: Library Services & Technology Act 45.310 40-7792 40,173 40,173 Library Services & Technology Act 45.310 40-7942 24,362 24,362 Subtotal Pass-Through 64,535 64,535 Total Institute of Museum and Library Services $ 64,535 $ 64,535 ENVIRONMENTAL PROTECTION AGENCY Passed through California Department of Public Health: EPA Beach Water Monitoring 66.472 11-10773 25,000 25,000 Subtotal Pass-Through 25,000 25,000 Total Enviromental Protection Agency $ 25,000 $ 25,000 U.S. DEPT OF ENERGY Direct programs: ARRA - Energy Efficiency and Conservation Block Grant Program 81.128 DE-EE0000903 180,535 221,245 ARRA - Energy Efficiency and Conservation Block Grant Program 81.128 DE-EE0000903 838,601 838,601 ARRA - Energy Efficiency and Conservation Block Grant Program 81.128 DE-EE0000903 18,894 18,894 ARRA - Energy Efficiency and Conservation Block Grant Program - Prior Year Adjustment 81.128 DE-EE0000903 (90,797) (90,797) ARRA - Energy Efficiency and Conservation Block Grant Program 81.128 DE-EE0000903 45,161 45,161 Subtotal Direct 992,394 1,033,104 See accompanying Notes to Schedule of Expenditures of Federal Awards. 7 COUNTY OF SAN LUIS OBISPO, CALIFORNIA Schedule of Federal Financial Assistance For the Year Ended June 30, 2012 Federal Pass-Through 2011-2012 CFDA Grantor's Revenue 2011-2012 Federal Grantor/Pass-Through Grantor/Program Title Number Number Recognized Expenditures U.S. DEPT OF ENERGY (continued) Passed through California Employment Development Department: ARRA - Clean Energy Grant 81.041 KO77128 $ 12,916 $ 12,916 Subtotal Pass-Through 12,916 12,916 Total U.S. Dept of Energy $ 1,005,310 $ 1,046,020 U. S. DEPT OF EDUCATION Passed through State Department of Alcohol and Drug Programs: Safe and Drug-Free Schools and Communites - State Grants: Drug Free School Program-Strengthening Families - Prior Year Adjustment 84.186 SDF 07-03 (107) (107) Subtotal Pass-Through (107) (107) Total Dept. of Education $ (107) $ (107) U. S. DEPT OF HEALTH & HUMAN SERVICES Direct Programs: Safe and Drug Free Communities-Sober Truth on Preventing Underage Drinking 93.276 2008-DC-BX-0028 45,563 45,563 Frug Free Communities Support Program - Drug Free Campus Cal Poly 93.276 H9SP15668A 140,047 140,047 Adult Treatment Drug Court 93.243 1H79TI021865-01 324,140 324,140 Adult Treatment Drug Court Collaborative 93.243 1H79TI023740-01 152,511 152,511 Treatment for Children Affected by Methamphetamine 93.243 1H79TI023367-01 383,122 383,122 Health Resources Services Administration 93.887 09-163 194,588 192,265 Health Resources Services Administration - Prior Year Adjustment 93.887 09-163 34 34 Subtotal Direct 1,240,005 1,237,682 Passed through Sate Department of Alcohol and Drug Programs: Substance Abuse Prevention & Treatment Block Grant-Discretionary Funds 93.959 988,428 988,428 Substance Abuse Prevention & Treatment Block Grant-Prevention Set-aside Funds 93.959 310,846 310,846 Substance Abuse Prevention & Treatment Block Grant-Friday Night Live and Club Live 93.959 30,000 30,000 Substance Abuse Prevention & Treatment Block Grant-HIV Set-aside Funds 93.959 45,513 45,513 Substance Abuse Prevention & Treatment Block Grant-Adolescent and Youth Treatment 93.959 176,774 176,774 Substance Abuse Prevention & Treatment Block Grant-Perinatal Set-aside Funds 93.959 72,193 72,193 Subtotal Pass-through 1,623,754 1,623,754 Passed through State Department of Child Support Services: Child Support Enforcement: Child Support Administration 93.563 3,010,883 3,010,883 Incentive Program 93.563 122,639 122,639 Subtotal Pass-through 3,133,522 3,133,522 Passed through State Dept of Public Health: CDC Base PH Emergency Preparedness 93.069 EPO-11-40 403,502 403,502 CDC Base PH Emergency Preparedness 93.069 EPO-10-40 198,459 198,459 CDC Base PH Emergency Preparedness - Prior Year Adjustment 93.069 EPO-10-40 110,338 110,338 CDC Disease Control 93.069 EPO-10-40 7,432 7,432 CDC Disease Control - Prior Year Adjustment 93.069 EPO-10-40 4,250 4,250 Subtotal CFDA 93.069 723,981 723,981 Lead Poisoning 93.197 08-85087 A02 50,985 41,143 Lead Poisoning-Prior year adjustment 93.197 08-85087 A02 (5,888) (5,888) Subtotal CFDA 93.197 45,097 35,255 Immunization Action Plan 93.268 11-10599 93,438 93,438 Immunization Information System - Prior Year Adjustment 93.268 1 1 Child Hlth & Disability Prevention 93.268 SLO 40 403,568 285,110 Child Hlth & Disability Prevention-Prior year adjustment 93.268 SLO 40 2,733 2,733 Subtotal CFDA 93.268 499,740 381,282 Health Resources Services Administration HPP 93.889 EPO 11-40 193,811 193,811 Health Resources Services Administration HPP - Prior Year Adjustment 93.889 EPO 11-40 132 132 Hospital Preparation Program 93.889 EPO 11-40 5,786 5,786 Health Resources Services Administration HPP 93.889 EPO 09-40 136,803 - Health Resources Services Administration HPP - Prior Year Adjustment 93.889 EPO 09-40 (133,196) (133,196) Subtotal CFDA 93.889 203,336 66,533 See accompanying Notes to Schedule of Expenditures of Federal Awards. 8 COUNTY OF SAN LUIS OBISPO, CALIFORNIA Schedule of Federal Financial Assistance For the Year Ended June 30, 2012 Federal Pass-Through 2011-2012 CFDA Grantor's Revenue 2011-2012 Federal Grantor/Pass-Through Grantor/Program Title Number Number Recognized Expenditures U. S. DEPT OF HEALTH & HUMAN SERVICES (continued) Passed through State Dept of Public Health (continued): AIDS Case Management 93.917 07-65079 HIV Care-Single Allocation Model / Ryan White Care 93.917 10-95288 $ 101,708 $ 101,708 HIV Care-Single Allocation Model / Ryan White Care - Prior year adjustment 93.917 10-95288 (1) (1) Subtotal CFDA 93.917 101,707 101,707 Children Services 93.994 SLOCO/MTP 1,259,363 667,462 Children Services-Prior year adjustment 93.994 SLOCO/MTP 83,828 83,828 Maternal & Child Health Services 93.994 2011-40 385,467 283,455 Maternal & Child Health Services-Prior year adjustment 93.994 2011-40 (2) (2) Subtotal CFDA 93.994 1,728,656 1,034,743 Subtotal Pass-through State Dept of Public Health 3,302,517 2,343,501 Centers for Disease Control and Prevention: CDC Pher H1N1 93.521 EPO 09-40 47,468 47,468 Subtotal 47,468 47,468 Medical Assistance Program: Medi-Cal Administration 93.778 09-86011 852,532 852,532 Medi-Cal Administration 93.778 09-86011 412,108 412,108 Medi-Cal Administration -Targeted Case Management 93.778 40-0409 678,330 678,330 Medi-Cal Administration -Targeted Case Management - Prior year adjustment 93.778 40-0409 3,626 3,626 ARRA - Medi-Cal Administration -Targeted Case Management -Prior year adjustment 93.778 40-0409 530 530 Administration: Medi-Cal 93.778 09-86011 A01 51,552 51,552 Administration: Medi-Cal 93.778 122,054 122,054 Administration: Medi-Cal-Prior year adjustment 93.778 33,256 33,256 Administration: Medi-Cal 93.778 4,687,342 4,687,342 Administration: Medi-Cal - IHSS 93.778 705,076 705,076 ARRA - Administration: Medi-Cal-Public Authority for IHSS - Prior Year Adjustment 93.778 55,022 55,022 Medi-Cal Admin-Prior year adjustment 93.779 194,951 194,951 Subtotal 7,796,379 7,796,379 Mental Health-Substance Abuse (SAMHSA) 93.958 432,579 432,579 Mental Health-Substance Abuse (SAMHSA)-Prior Year Adjustment 93.958 94,592 94,592 Subtotal 527,171 527,171 Subtotal Pass-through State Dept of Health Care Services 8,371,018 8,371,018 Passed through the State Department of Mental Health: Mental Health-McKinney Homeless 93.150 51,512 51,512 Subtotal Pass-through Dept of Mental Health 51,512 51,512 Passed through the State Department of Social Services: Promoting Safe and Stable Families 93.556 138,318 138,318 Subtotal CFDA 93.556 138,318 138,318 Temporary Assistance for Needy Families: Administration: CALWORKS 93.558 9,362,652 9,317,655 Administration: CALWORKS-Prior year adjustment 93.558 4,490 4,490 Assistance: CALWORKS & Kinship Guardian 93.558 5,500,772 5,500,772 Subtotal CFDA 93.558 14,867,914 14,822,917 Foster Care - Title IV-E Administration: Probation - Title IV E 93.658 990,426 996,711 Administration: Probation - Title IV E- Prior year adjustment 93.658 101,761 101,761 Child Welfare Services - Title IV E 93.658 3,705,252 3,705,253 Child Welfare Services - Title IV E - Prior Year Adjustment 93.658 830 830 Assistance: Foster Care 93.658 2,377,428 2,377,954 Assistance: Foster Care-Prior year adjustment 93.658 565,019 565,019 ARRA - Assistance: Foster Care-ARRA-Prior Year adjustment 93.658 (557) (557) Subtotal CFDA 93.658 7,740,159 7,746,971 See accompanying Notes to Schedule of Expenditures of Federal Awards. 9 COUNTY OF SAN LUIS OBISPO, CALIFORNIA Schedule of Federal Financial Assistance For the Year Ended June 30, 2012 Federal Pass-Through 2011-2012 CFDA Grantor's Revenue 2011-2012 Federal Grantor/Pass-Through Grantor/Program Title Number Number Recognized Expenditures U. S. DEPT OF HEALTH & HUMAN SERVICES (continued) Passed through the State Department of Mental Health (continued): Adoption Incentives 93.603 $ 3,920 $ 3,920 Child Welfare Services Title IV-B 93.645 580,065 201,183 Child Welfare Services Title IV-B - Prior Year Adjustment 93.645 6,266 6,266 Refugee Cash Assistance 93.566 634 634 Administration: Adoption 93.659 745,368 745,368 Administration: Adoption - Prior Year Adjustment 93.659 (832) (832) Assistance: Adoption 93.659 2,805,802 2,805,009 Assistance: Adoption - Prior Year Adjustment 93.659 (6) (6) ARRA - Assistance: Adoption-Prior year adjustment 93.659 (171) (171) Independent Living Program 93.674 126,337 126,337 Independent Living Program-Prior year adjustment 93.674 439 439 Child Welfare Services-Title XX 93.667 175,704 263,556 Child Welfare Services-Title XX-Prior year adjustment 93.667 120,637 120,637 Subtotal 4,564,163 4,272,340 Subtotal Pass-through State Department of Social Services 27,310,554 26,980,546 Subtotal Pass-through programs 43,792,877 42,503,853 Total Dept. of Health & Human Services $ 45,032,882 $ 43,741,535 DEPARTMENT OF HOMELAND SECURITY Direct Programs: Transportation Security Administration, Law Enforcement Personnel 97.090 HSTS0208HSLR257 142,896 142,896 Transportation Security Administration, Law Enforcement Personnel - Disaster Grants - Storm Reimbursement 2010 - Prior Year Adjustment 97.036 13,649 13,649 Disaster Grants - Storm Reimbursement 2010 - Prior Year Adjustment 97.036 1,609 1,609 Disaster Grants - Storm Reimbursement 2010 - Prior Year Adjustment 97.036 20,091 20,091 FEMA - Prior Year Adjustment 97.036 1,207 1,207 Subtotal Direct 179,452 179,452 Passed throght California Dept of Boating & Waterways Boating Safety Financial Assistance 97.036 10-108-803 665 665 Subtotal passed through CA Dept of Boating & Waterways 665 665 Passed throght California Emergency Management Agency: Disaster Grants - Public Assistance - Prior Year Adjustment 97.036 FEMA-1952-DR 1,487 1,487 Disaster Grants - Public Assistance - Prior Year Adjustment 97.036 FEMA-1505-DR-CA (148,610) (148,610) Disaster Grants - Public Assistance - Prior Year Adjustment 97.036 6,887 6,887 Subtotal CFDA 97.036 (140,236) (140,236) Emergency Management Performance Grants: Emergency Management Program Grant 97.042 079-00000 15,000 15,000 Emergency Management Program Grant 97.042 079-00000 15,000 15,000 Emergency Management Program Grant 97.042 079-00000 7,500 7,500 Emergency Management Performance 2011 97.042 2011-0048 47,063 47,063 Subtotal CFDA 97.042 84,563 84,563 Homeland Security Grant Program 97.073 2008-0006 14,231 14,231 Homeland Security Grant Program 97.073 2009-0019 86,813 81,977 Homeland Security Grant Program - Prior year adjustment 97.073 2009-0019 3,021 3,021 Homeland Security Grant Program-Prior year adjustment 97.073 SLOCO (368) (368) Subtotal CFDA 97.073 103,697 98,861 Public Safety Interooperable Communications 97.055 FY07 UASI - - Homeland Security 97.067 2009-0019 1,653 1,653 Homeland Security - Prior Year Adjustment 97.067 2009-0019 (3,000) (3,000) Homeland Security 97.067 2009-0019 8,212 2,520 Homeland Security - Prior Year Adjustment 97.067 2009-0019 (5,692) (5,692) Homeland Security 97.067 2009-0019 19,689 19,689 Homeland Security 97.067 2009-0019 24,550 24,550 Homeland Security 97.067 2009-0019 20,000 20,000 Homeland Security 97.067 2009-0019 17,249 17,249 Homeland Security - Prior Year Adjustment 97.067 2009-0019 28,057 28,057 See accompanying Notes to Schedule of Expenditures of Federal Awards. 10 COUNTY OF SAN LUIS OBISPO, CALIFORNIA Schedule of Federal Financial Assistance For the Year Ended June 30, 2012 Federal Pass-Through 2011-2012 CFDA Grantor's Revenue 2011-2012 Federal Grantor/Pass-Through Grantor/Program Title Number Number Recognized Expenditures DEPARTMENT OF HOMELAND SECURITY (continued) Passed throght California Emergency Management Agency (continued): Homeland Security 97.067 2009-0019 $ - $ 4,985 Homeland Security 97.067 2010-0085 5,403 5,403 Homeland Security 97.067 2011-0048 4,154 4,154 Homeland Security 97.067 2010-0085 7,000 7,000 Homeland Security - Prior Year Adjustment 97.067 2010-0085 (701) (701) Homeland Security 97.067 2010-0085 3,791 3,791 Homeland Security 97.067 2010-0085 34,142 34,142 Homeland Security - Prior Year Adjustment 97.067 2008-006 6,320 6,320 Homeland Security - Prior Year Adjustment 97.067 2011-0077 7,022 7,022 Homeland Security - Prior Year Adjustment 97.067 2008-006 (438) (438) Homeland Security 97.067 2008-006 18,882 18,882 Homeland Security - Prior Year Adjustment 97.067 2008-006 (18,882) (18,882) Subtotal CFDA 97.067 177,411 176,704 Bufferzone Grant 97.078 2009-0026 196,751 196,751 Subtotal CFDA 97.036 196,751 196,751 Subtotal Passed-through California Emergency Management Agency 422,186 416,643 Subtotal Pass-throughs 422,851 417,308 Total Department of Homeland Security 602,303 596,760 TOTAL FEDERAL FINANCIAL ASSISTANCE $ 80,764,496 $ 96,315,172 See accompanying Notes to Schedule of Expenditures of Federal Awards. 11 THIS PAGE INTENTIONALLY LEFT BLANK 12 COUNTY OF SAN LUIS OBISPO Notes to the Schedule of Expenditures of Federal Awards For the Year Ended June 30, 2012 NOTE 1: REPORTING ENTITY The accompanying Schedule of Expenditures of Federal Awards (SEFA) presents the activity of all federal awards programs of the County of San Luis Obispo (County). The County’s reporting entity is defined in Note 1 to the County’s basic financial statements. All federal awards received directly from federal agencies as well as federal awards passed through other government agencies are included in the schedule. Expenditures funded by the American Recovery and Reinvestment Act of 2009 are denoted by the prefix “ARRA” in the federal program title. NOTE 2: BASIS OF ACCOUNTING The accompanying SEFA is presented using the modified accrual basis of accounting for program expenditures accounted for in governmental funds and the accrual basis of accounting for expenditures accounted for in proprietary funds, as described in Note 1 of the County’s basic financial statements. NOTE 3: RELATIONSHIP TO FINANCIAL STATEMENTS The amounts reported in the accompanying SEFA agree, in all material respects, to amounts reported within the County’s financial statements. Federal award revenues are reported principally in the County’s financial statements as intergovernmental revenues in the General and Special Revenue funds. NOTE 4: SUBRECIPIENTS Of the federal expenditures presented in the SEFA, the County provided federal awards to subrecipients as follows: Federal CFDA Program Title Amount 14.218 Low Income Housing Assistance Community Development Block Grants $ 1,757,221 14.231 Emergency Solutions Grant 91,683 14.253 Community Development Block Grant - ARRA 68,948 14.257 Homelessness Prevention and Rapid Re-housing 224,037 17.258 Workforce Investment Act-Adult 558,887 17.278 Workforce Investment Act-Dislocated Worker/Rapid Response 622,822 93.778 First Five 45,595 93.778 Medi-CAL Administration-Lucia Mar Unified School District 477,462 93.778 Medi-CAL Administration-San Luis Coastal Unified School District 329,475 Total $ 4,176,130 13 COUNTY OF SAN LUIS OBISPO Notes to the Schedule of Expenditures of Federal Awards For the Year Ended June 30, 2012 NOTE 5: LOANS WITH CONTINUING COMPLIANCE REQUIREMENT Outstanding federally-funded program loans with a continuing compliance requirement had the following balances during the year: Federal Amount Outstanding CFDA Program Title July 1, 2011 June 30, 2012 14.218 Community Development Block Grants/Entitlement Grants $2,493,886 $2,493,886 14.239 HOME Investment Partnerships Program 14,289,892 14,289,892 NOTE 6: PASS-THROUGH ENTITIES’ IDENTIFYING NUMBER When federal awards are received from a pass-through entity, the SEFA shows, if available, the identifying number assigned by the pass-through entity. When no identifying number is shown, the County determined that no identifying number is assigned for the program or the County was unable to obtain an identifying number from the pass-through entity. NOTE 7: TOTAL FEDERAL AWARDS EXPENDED BY CFDA NUMBER When there is more than one program under a single CFDA number, the SEFA totals all programs under the one CFDA number. Occasionally, however, this total could not be conveniently displayed because all programs under one CFDA number were not contiguous. When this occurred, this total is not shown in the Schedule, but instead is provided below: Total Federal Total Federal CFDA No. Expenditures CFDA No. Expenditures 10.561 $ 3,623,729 93.276 $ 185,610 14.218 4,997,898 93.645 207,449 14.235 913,843 93.659 3,549,368 14.239 14,495,560 93.667 384,193 14.253 86,972 93.674 126,776 16.607 22,501 93.778 7,601,428 16.710 64,348 93.887 192,299 16.582 34,203 97.036 (103,015) 16.738 20,704 16.803 408,358 17.207 2,289 93.243 859,773 14 COUNTY OF SAN LUIS OBISPO Schedule of Findings and Questioned Costs For the Year Ended June 30, 2012 Section 1 Financial Statements Summary of Auditor’s Results 1. Type of auditor’s report issued: Unqualified 2. Internal controls over financial reporting: a. Material weaknesses identified? No b. Significant deficiencies identified not considered to be material weaknesses? None Reported 3. Noncompliance material to financial statements noted? No Federal Awards 1. Internal control over major programs: a. Material weaknesses identified? No b. Significant deficiencies identified not considered to be material weaknesses? None Reported 2. Type of auditor’s report issued on compliance for major programs: Unqualified 3. Any audit findings disclosed that are required to be reported in accordance with Circular OMB A-133, Section 510(a)? No 4. Identification of major programs: CFDA Number Name of Federal Program 10.561 State Administrative Matching Grants For the Supplemental Nutrition Assistance Program 14.218, 14.253 CDBG – Entitlement Grants Cluster 14.239 Home Investment Partnership Program 81.128 ARRA – Energy Efficiency and Conservation Block Grant 93.558 Temporary Assistance for Needy Families 93.658 Foster Care – Title IV-E 93.659 Adoption Assistance 93.778 Medical Assistance Program 15 COUNTY OF SAN LUIS OBISPO Schedule of Findings and Questioned Costs For the Year Ended June 30, 2012 Section 1 (continued) Federal Awards (continued) 5. Dollar Threshold used to distinguish between Type A and Type B programs? $ 2,889,455 6. Auditee qualified as a low-risk auditee under OMB Circular A-133, Section 530? No Section 2 Financial Statement Findings None Reported Section 3 Federal Award Findings and Questioned Costs None Reported 16 COUNTY OF SAN LUIS OBISPO Schedule of Findings and Questioned Costs For the Year Ended June 30, 2012 None reported 17 THIS PAGE INTENTIONALLY LEFT BLANK 18 COUNTY OF SAN LUIS OBISPO Summary Schedule of Prior Audit Findings Federal Awards For the Year Ended June 30, 2012 Reference Number 11-SA-1 Federal Program Title Community Development Block Grants/Entitlement Grants Community Development Block Grant ARRA Entitlement Grants (CDBG-R – Recovery Act Funded) CFDA Number 14.218, 14.253 Recommendation We recommend that the County develop a monitoring plan which is in accordance with the requirements of the HUD’s CDBG Grantee Handbook and that each subrecipient is monitored at least once every two years. Some of the steps in the monitoring process include: Develop a monitoring plan at the beginning of each program year in order to match available resources with the needs and capacity of funded subrecipients. Standardize monitoring procedures designed to ensure consistency and thoroughness in monitoring reviews. Grantees should use standardized monitoring checklists or guidebooks. Monitoring procedures should also specify the steps to be followed for monitoring visits. You may want to refer to the State CDBG Program’s monitoring checklists located in Chapter 12 of the Grant Management Manual. Status During our audit we examined appropriate and sufficient documentation to determine that the above finding has been implemented. Reference Number 11-SA-2 Federal Program Title Temporary Assistance For Needy Families ARRA – Emergency Contingency Fund for Temporary Assistance for Need Families (TANF) State Programs Adoption Assistance Program ARRA – Adoption Assistance Program Medical Assistance Program ARRA – Medical Assistance Program CFDA Number 93.558, 93.714, 93.659, 93.778 Recommendation Without appropriate usage of the internal control checklist, the eligibility staff is making decisions without a paper case file likely could act on incomplete or inaccurate information, which could lead to erroneous eligibility decisions. Status During our audit we examined appropriate and sufficient documentation to determine that the above finding has been implemented. 19 COUNTY OF SAN LUIS OBISPO Summary Schedule of Prior Audit Findings Federal Awards For the Year Ended June 30, 2012 Reference Number 11-SA-3 Federal Program Title Temporary Assistance for Needy Families ARRA – Emergency Contingency Fund for Temporary Assistance for Needy Families (TANF) State Programs Adoption Assistance Program ARRA – Adoption Assistance Program Medical Assistance Program ARRA – Medical Assistance Program CFDA Number 93.558, 93.714, 93.659, 93.778 Recommendation Internal controls are designed to safeguard assets and help or detect losses from employee dishonesty or error. A fundamental concept in a good system of internal control is the segregation of duties. Although the size of the County's accounting staff prohibits complete adherence to this concept, we believe that the following practices could be implemented to improve existing internal control without impairing efficiency: The management should clearly communicate the lines of authority for determining eligibility. Management should take timely appropriate action for known departures from approved policies and procedures and compliance requirements. Management should periodically review authorized signatures on eligibility documents. Periodic internal audits of detailed transactions should be conducted. Status During our audit we examined appropriate and sufficient documentation to determine that the above finding has been implemented. Reference Number 11-SA-4 Federal Program Title Adoption Assistance Program ARRA – Adoption Assistance Program CFDA Number 93.659 Recommendation We recommend that County staff ensure a properly-executed Adoption Assistance Agreement is contained in the case file before approving eligibility for Federal Adoption Assistance. Status During our audit we examined appropriate and sufficient documentation to determine that the above finding has been implemented. 20 COUNTY OF SAN LUIS OBISPO Summary Schedule of Prior Audit Findings Federal Awards For the Year Ended June 30, 2012 Reference Number 11-SA-5 Federal Program Title Medical Assistance Program ARRA – Medical Assistance Program CFDA Number 93.778 Recommendation We recommend that the Department strictly adhere to the established policies and procedures with regards to ongoing eligibility verification. Status During our audit we examined appropriate and sufficient documentation to determine that the above finding has been implemented. 21 THIS PAGE INTENTIONALLY LEFT BLANK 22 SUPPLEMENTARY SCHEDULE OF GRANT EXPENDITURES THIS PAGE INTENTIONALLY LEFT BLANK COUNTY OF SAN LUIS OBISPO Schedule of the California Emergency Management Agency and the Department of Corrections and Rehabilitation Grants Expenditures For the Year Ended June 30, 2012 Share of Expenditures Expenditures Claimed Current Year For the Period For the Year Cumulative Through Ended As of Federal State County Program June 30, 2011 June 30, 2012 June 30, 2012 Share Share Share Gang Task Force - DC11 22 0400 Personal services $ -- $ 74,138 $ 74,138 $ 74,138 $ -- -- Operating expenses -- 82,106 82,106 82,106 -- -- Totals $ -- $ 156,244 $ 156,244 $ 156,244 $ -- $ -- Victim/Witness Assistance - VW10290400 - VW11300400 Personal services $ 191,666 $ 191,666 $ 383,332 $ 87,120 $ 104,546 $ -- Totals $ 191,666 $ 191,666 $ 383,332 $ 87,120 $ 104,546 $ -- Victim (Elder) Advocacy Outreach - UV10010400 - UV100200400 UV10010400 UV100200400 Personal services $ 125,000 $ 161,160 $ 286,160 $ 125,000 $ -- $ 3 6,160 Totals $ 125,000 $ 161,160 $ 286,160 $ 125,000 $ -- $ 3 6,160 ARRA - Project Safe Neighborhoods - US10010400 Operating expenses 10,000 3,615 13,615 3,615 -- -- Totals $ 10,000 $ 3,615 $ 13,615 $ 3,615 $ -- $ -- ARRA - Justice Assistance Grant: Evidence Based Practices Supervision - ZP09910400 Personal services $ 150,238 $ 206,808 $ 357,046 $ 206,808 $ -- $ -- Operating expenses 16,200 32,110 48,310 20,107 12,003 -- Totals $ 166,438 $ 238,918 $ 405,356 $ 226,915 $ 12,003 $ -- NOTE: Grant UV11020400 calendar year is 10/1/11-9/30/12 23 COUNTY OF SAN LUIS OBISPO Schedule of the California Emergency Management Agency and the Department of Corrections and Rehabilitation Grants Expenditures For the Year Ended June 30, 2012 Share of Expenditures Expenditures Claimed Current Year For the Period For the Year Cumulative Through Ended As of Federal State County Program June 30, 2011 June 30, 2012 June 30, 2012 Share Share Share ARRA - Justice Assistance Grant: Comprehensive Drug Court Initiative - DI 10 01 0400 Personal services -- 133,408 $ 133,408 133,408 $ -- -- Operating expenses -- 4,674 4,674 4,674 -- -- Totals $ -- $ 138,082 $ 138,082 $ 138,082 $ -- $ -- ARRA - Justice Assistance Program: Offender Treatment Program - ZO09010400 Personal services $ 200,464 $ 43,361 $ 243,825 $ 43,361 $ -- $ -- Operating expenses 184,000 -- 184,000 -- -- -- Totals $ 384,464 $ 43,361 $ 427,825 $ 43,361 $ -- $ -- Juvenile Accountability Block Grant - CSA 166-11 Personal services $ 17,580 $ 26,330 $ 43,910 $ 23,936 $ -- $ 2 ,394 Totals $ 17,580 $ 26,330 $ 43,910 $ 23,936 $ -- $ 2 ,394 24 AVIATION PASSENGER FACILITIES CHARGES THIS PAGE INTENTIONALLY LEFT BLANK INDEPENDENT AUDITOR’S REPORT ON SCHEDULE OF PASSENGER FACILITY CHARGES, REVENUES, AND EXPENSES Board of Supervisors County of San Luis Obispo San Luis Obispo, California We have audited the accompanying Schedule of Passenger Facility Charges (PFC), Revenues, and Expenses (Schedule) of the County of San Luis Obispo (County), for the annual period and each quarterly period from July 1, 2011 to June 30, 2012. The Schedule is the responsibility of the County’s management. Our responsibility is to express an opinion 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. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the Schedule is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the Schedule. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the Schedule. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the Schedule referred to above presents fairly, in all material respects, the passenger facility charges received, held, and used by the County for the period and each quarter during the period from July 1, 2011 to June 30, 2012, as defined by the Federal Aviation Administration of the U.S. Department of Transportation. In accordance with Government Auditing Standards we have also issued our report dated December 28, 2012 on our consideration of the County’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grants. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit. Roseville, California December 28, 2012 25 925 Highland Pointe Drive, Suite 450, Roseville, CA 95678-5418 tel: 916.784.7800 fax: 916.784.7850 www.gallina.com THIS PAGE INTENTIONALLY LEFT BLANK 26 REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO THE PASSENGER FACILITY CHARGES PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE Board of Supervisors County of San Luis Obispo San Luis Obispo, California Compliance We have audited the compliance of the County of San Luis Obispo (County) with the compliance requirements described in the Passenger Facility Charge Audit Guide for Public Agencies, issued by the Federal Aviation Administration (Guide), for its Passenger Facility Charge program for the period and each quarter during the period from July 1, 2011 to June 30, 2012. Compliance with the requirements of laws and regulations applicable to its Passenger Facility Charge program is the responsibility of the County’s management. Our responsibility is to express an opinion on the County’s compliance based on our audit. 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 the Guide. Those standards and the Guide require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the compliance requirements referred to above that could have a direct and material effect on the passenger facility charge 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 its Passenger Facility Charge program for the period and each quarter during the period from July 1, 2011 to June 30, 2012. 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 and regulations applicable to the Passenger Facility Charge program. In planning and performing our audit, we considered the County’s internal control over compliance with requirements that could have a direct and material effect on the Passenger Facility Charge program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance 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 County’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 course of performing their assigned functions, to prevent or detect and correct noncompliance with a type of compliance requirement of the passenger facility charge program on a timely basis. 27 925 Highland Pointe Drive, Suite 450, Roseville, CA 95678-5418 tel: 916.784.7800 fax: 916.784.7850 www.gallina.com Board of Supervisors County of San Luis Obispo San Luis Obispo, California A material weakness in internal control over compliance is a deficiency, or a combination of deficiencies in internal control over compliance, such that there is a reasonable possibility that a material noncompliance with a type of compliance requirement of the passenger facility charge program will not be prevented or detected and corrected on a timely basis. 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 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. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the basic financial statements as a whole. This report is intended solely for the information of management, the Board of Supervisors, the U.S. Federal Aviation Administration, and the airline parties operating at the Airport and it is not intended to be and should not be used by anyone other than these specified parties. Roseville, California December 28, 2012 28 REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF THE SCHEDULE OF PASSENGER FACILITY CHARGES, REVENUES AND EXPENSES PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Board of Supervisors County of San Luis Obispo San Luis Obispo, California We have audited the Schedule of Passenger Facility Charges, Revenues and Expenses (Schedule) of the County of San Luis Obispo (County) for the period and each quarter during the period from July 1, 2011 to June 30, 2012, and have issued our report thereon dated December 28, 2012. 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 our opinion on the Schedule 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 deficiency in internal control 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 and correct misstatements on a timely basis. A material weakness is a deficiency or a combination of deficiencies in internal control, such that there is a reasonable possibility that a material misstatement of the Schedule will not be prevented or detected and corrected on a timely basis. 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. Compliance and Other Matters As part of obtaining reasonable assurance about whether the Schedule of the Airport is 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 the Schedule's 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. 29 925 Highland Pointe Drive, Suite 450, Roseville, CA 95678-5418 tel: 916.784.7800 fax: 916.784.7850 www.gallina.com Board of Supervisors County of San Luis Obispo San Luis Obispo, California This report is intended solely for the information of management, the Board of Supervisors, the U.S. Federal Aviation Administration, and the airline parties operating at the Airport and it is not intended to be and should not be used by anyone other than these specified parties. Roseville, California December 28, 2012 30 COUNTY OF SAN LUIS OBISPO, CALIFORNIA SCHEDULE OF PASSENGER FACILITY CHARGES COLLECTED AND EXPENDED FOR THE YEAR ENDED JUNE 30, 2012 Current Year Project to Date Approved Receipts Receipts Unliquidated Approved Federal Application Number/ Project or Revenues Interest or Revenues Interest Balance in Project Description Allocation Recognized Earned Expenditures Recognized Earned Expenditures PFC Trust AWP-97-04-I-00-SBP, 99-06-C-00-SBP Revenues $ $ 314,411 $ 2,651 $ 3,469,597 $ 153,601 $ $ - Expenditures: Terminal development and construction 6,820,830 5 4,557 3,040,549 Airport staff and administration 4 ,750 99,286 Transfers (to) from other PFCs Total passenger facility charges - PFC 04 and 06 6,820,830 314,411 2,651 5 9,307 3,469,597 153,601 3,139,835 483,363 AWP-95-05-C-00-SBP Revenues 1,032,729 24,947 Expenditures: SLO Master Plan, Environ. Impact Report 278,422 278,422 Land Acquisition 779,254 768,107 Airport staff and administration 11,147 Transfers (to) from other PFCs Total passenger facility charges - PFC 05 1,057,676 - - - 1,032,729 24,947 1,057,676 - AWP-02-07-C-00-SBP Revenues - - 1,652,880 77,392 Expenditures: Runway extension 814,222 722,723 Taxiway construction 376,499 468,864 Airfield improvements 214,940 27,190 Acquisition runway sweeping equipment 22,000 - Airfield lighting improvements 27,500 - Relocate threshold runway 25 82,500 168,772 Construction ARFF facilities 154,660 - 154,661 Airport master plan 37,950 - 79,247 Airport staff and administration 108,815 Transfers to other PFCs Total passenger facility charges - PFC 07 1,730,271 - - - 1,652,880 77,392 1,730,272 - AWP-07-08-C-00-SBP Revenues 1,427,539 45,537 - Expenditures: Environmental assessment 110,000 110,000 Runway extension 908,025 21,011 475,663 Property acquisition 287,028 30,387 EMAS 605,262 602,120 Update layout plan 2,875 ARFF mass casualty vehicle 115,000 107,726 107,726 Transfers to other PFCs Total passenger facility charges - PFC 08 2,028,190 - - 107,726 1,427,539 66,548 1,325,896 168,191 Total passenger facility charges $11,636,967 $ 314,411 $ 2,651 $ 167,033 $ 7,582,745 $ 322,488 $ 7,253,679 $ 651,554 31