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State of Indiana an Equal Opportunity Employer State Board of Accounts 302 West Washington Street Room E418 Indianapolis, Indiana 46204-2765

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State of Indiana an Equal Opportunity Employer State Board of Accounts 302 West Washington Street Room E418 Indianapolis, Indiana 46204-2765 STATE OF INDIANA AN EQUAL OPPORTUNITY EMPLOYER STATE BOARD OF ACCOUNTS 302 WEST WASHINGTON STREET ROOM E418 INDIANAPOLIS, INDIANA 46204-2765 Telephone: (317) 232-2513 Fax: (317) 232-4711 Web Site: www.in.gov/sboa November 19, 2012 Board of Directors City of Indianapolis 200 E. Washington Street, Suite 2222 Indianapolis, IN 46204 We have reviewed the audit report prepared by KPMG, LLP, Independent Public Accountants, for the period January 1, 2011 to December 31, 2011. In our opinion, the audit report was prepared in accordance with the guidelines established by the State Board of Accounts. Per the Independent Public Accountants’ opinion, the financial statements included in the report present fairly the financial condition of the City of Indianapolis, as of December 31, 2011 and the results of its operations for the period then ended, on the basis of accounting described in the report. We call your attention to the twenty-four findings in the Single Audit Report, on pages 13 through 42. Eight of those findings represent deficiencies in internal control over financial reporting. Five of those eight findings represent material weaknesses. The auditors have issued a qualified opinion on compliance with applicable requirements for five of the nine major federal programs. The Independent Public Accountants’ report is filed with this letter in our office as a matter of public record. STATE BOARD OF ACCOUNTS CITY OF INDIANAPOLIS, INDIANA (A Component Unit of the Consolidated City of Indianapolis – Marion County) OMB Circular A-133 Single Audit Report For the year ended December 31, 2011 (With Independent Auditors’ Reports Therein) CITY OF INDIANAPOLIS, INDIANA (A Component Unit of the Consolidated City of Indianapolis – Marion County) OMB Circular A-133 Single Audit Report For the year ended December 31, 2011 Table of Contents Page(s) Schedule of Expenditures of Federal Awards 1 – 3 Notes to Schedule of Expenditures of Federal Awards 4 Independent Auditors’ 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 5 – 6 Independent Auditors’ 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 7 – 10 Schedule of Findings and Questioned Costs 11 – 42 CITY OF INDIANAPOLIS, INDIANA (A Component Unit of the Consolidated City of Indianapolis – Marion County) Schedule of Expenditures of Federal Awards For the year ended December 31, 2011 Amount passed through Total CFDA to federal Federal grantor/pass‐through grantor Pass‐through grantor number Program title number subrecipients expenditures U.S. Department of Agriculture: Indiana State Department of Education N/A Summer Food Service Program for Children 10.559 $ — 470,078 Total U.S. Department of Agriculture — 470,078 U.S. Department of Housing and Urban Development: Community Development Block Grant Cluster: Community Development Block Grants / Entitlement Grants 14.218 5,097,433 21,013,612 ARRA – Community Development Block Grant ARRA Entitlement Grants (CDBG‐R) (Recovery Act Funded) 14.253 531,624 531,624 Total Community Development Block Grant Cluster: 5,629,057 21,545,236 State of Indiana, Office of Community and Rural Affairs DR2‐09‐084 Community Development Block Grants / State's Program and Non‐Entitlement Grants in Hawaii 14.228 2,600,000 2,620,000 Emergency Shelter Grants Program 14.231 373,236 391,416 Supportive Housing Program 14.235 1,279,863 1,342,955 Shelter Plus Care 14.238 2,081,992 2,110,356 Home Investment Partnerships Program 14.239 3,055,865 3,456,079 Housing Opportunities for Persons with AIDS 14.241 871,764 897,889 Economic Development Initiative – Special Project, Neighborhood Initiative, and Miscellaneous Grants 14.251 — 247,997 ARRA – Recovery Act – Homelessness Prevention and Rapid Re‐Housing Program (HPRP) 14.257 1,002,282 1,064,860 Community Challenge Planning Grants and the Department of Transportation's TIGER II Planning Grants 14.704 — 123,287 Total U.S. Department of Housing and Urban Development 16,894,059 33,800,075 U.S. Department of Justice: Alcohol Tobacco and Firearms Joint Operations 16.XXX — 112,456 Customs Joint Operations 16.XXX — 9,811 DEA Overtime 16.XXX — 63,552 FBI Overtime 16.XXX — 125,099 Safe Streets Gang Initiative 16.XXX — 118,909 U.S. Marshall Overtime 16.XXX — 31,951 Federal Equitable Share Agreements 16.XXX — 19,600 Marion County, Indiana N/A Federal Equitable Share Law Enforcement – Forfeitures 16.XXX — 1,302,705 Total 16.XXX — 1,784,083 Services for Trafficking Victims 16.320 148,309 289,615 Indiana State Police A21‐1‐100IMPD10 and A2‐10‐100931 Missing Children’s Assistance 16.543 — 12,870 National Institute of Justice Research, Evaluation, and Development Project Grants 16.560 53,131 250,483 Indiana Criminal Justice Institute 09VALE009 and 10VALE216 Crime Victim Assistance 16.575 — 123,192 Edward Byrne Memorial State and Local Law Enforcement Assistance Discretionary Grants Program 16.580 46,868 202,628 Grants to Encourage Arrest Policies and Enforcement of Protection Orders Program 16.590 121,984 275,100 Community Capacity Development Office 16.595 246,378 446,530 Bulletproof Vest Partnership Program 16.607 — 148,411 Public Safety Partnership and Community Policing Grants 16.710 — 175,498 ARRA – Recovery Act – Public Safety Partnership and Community Policing Grants 16.710 — 3,401,744 Total 16.710 — 3,577,242 (continued) 1 CITY OF INDIANAPOLIS, INDIANA (A Component Unit of the Consolidated City of Indianapolis – Marion County) Schedule of Expenditures of Federal Awards For the year ended December 31, 2011 Amount passed through Total CFDA to federal Federal grantor/pass‐through grantor Pass‐through grantor number Program title number subrecipients expenditures Edward Byrne Memorial Justice Assistance Grant Cluster: Edward Byrne Memorial Justice Assistance Grant Program 16.738 $ 143,917 805,539 Indiana Criminal Justice Institute 09‐DJ‐094, 09‐DJ‐021, and 10‐DJ‐019 Edward Byrne Memorial Justice Assistance Grant Program 16.738 — 195,020 Indianapolis Housing Agency N/A Edward Byrne Memorial Justice Assistance Grant Program 16.738 — 15,035 Marion County, Indiana Prosecutor's Office 09‐DJ‐035 Edward Byrne Memorial Justice Assistance Grant Program 16.738 — 7,124 Total 16.738 143,917 1,022,718 Indiana Criminal Justice Institute 09‐JRA‐017, 09‐JRA‐022, and 09‐JRA‐013 ARRA – Recovery Act – Edward Byrne Memorial Justice Assistance Grant (JAG) Program / Grants to States and Territories 16.803 114,891 357,176 ARRA – Recovery Act – Edward Byrne Memorial Justice Assistance Grant (JAG) Program / Grants to Units of Local Government 16.804 1,168,626 1,788,454 Total Edward Byrne Memorial Justice Assistance Grant Cluster 1,427,434 3,168,348 Indiana Criminal Justice Institute 08‐PG‐013, 09‐PG‐028, and 11‐PG‐031 Anti‐Gang Initiative 16.744 — 269,283 Criminal and Juvenile Justice and Mental Health Collaboration Program 16.745 37,726 110,455 Congressionally Recommended Awards 16.753 — 156,002 Indiana State Police 2009‐SN‐B9‐K051 ARRA – Recovery Act – Internet Crimes Against Children Task Force Program 16.800 — 19,568 Total U.S. Department of Justice 2,081,830 10,833,810 U.S. Department of Transportation: Highway Planning and Construction Cluster: A249‐11‐320080A, A249‐08‐320756, A249‐09‐320756, Indiana Department of Transportation A249‐11‐320139, and A249‐11‐320618 Highway Planning and Construction 20.205 — 4,149,609 Indiana Department of Transportation A249‐10‐320265 ARRA – Recovery Act – Highway Planning and Construction 20.205 — 110,430 Total 20.205 — 4,260,039 Indiana Department of Natural Resources RT‐06‐007 Recreational Trails Program 20.219 — 4,217 Total Highway Planning and Construction Cluster — 4,264,256 Highway Safety Cluster: Marion County, Indiana Prosecutor's Office N/A State and Community Highway Safety 20.600 — 198,479 Marion County, Indiana Prosecutor's Office N/A Alcohol Impaired Driving Countermeasures Incentive Grants I 20.601 — 233,858 Indiana Criminal Justice Institute N/A Occupant Protection Incentive Grants 20.602 — 6,169 Total Highway Safety Cluster: — 438,506 Total U.S. Department of Transportation — 4,702,762 Environmental Protection Agency: Surveys, Studies, Research, Investigations, Demonstrations, and Special Purpose Activities Relating to the Clean Air Act 66.034 — 42,595 State of Indiana Budget Agency CS18230501, CS18235801, CS18237101, CS18241201, WW Indy 6‐2004 B, WW0501497, Indy Loan 8, Indy Loan 9, Indy Loan #10, #Indy Loan 11, and #Indy Loan 12 Capitalization Grants for Clean Water State Revolving Funds 66.458 — 15,471,117 Solid Waste Management Assistance Grants 66.808 — 35,559 Brownfields Assessment and Cleanup Cooperative Agreements 66.818 — 143,808 Total Environmental Protection Agency — 15,693,079 U.S. Department of Energy: Indiana Department of Energy and Defense DE‐EE‐002544‐10‐CCR‐005 ARRA – Conservation Research and Development 81.086 468,610 699,051 ARRA – Recovery Act – Energy Efficiency and Conservation Block Grant Program (EECBG) 81.128 459,726 4,917,463 Total U.S. Department of Energy 928,336 5,616,514 U.S. Department of Education: Fund for the Improvement of Education 84.215 9,918 9,918 Indiana Department of Education A58‐0‐10DL‐049 Twenty – First Century Community Learning Centers 84.287 — 328,635 Indianapolis Parks Foundation U215J080108A Twenty – First Century Community Learning Centers 84.287 — 2,168 Total 84.287 — 330,803 Total U.S. Department of Education 9,918 340,721 (continued) 2 CITY OF INDIANAPOLIS, INDIANA (A Component Unit of the Consolidated City of Indianapolis – Marion County) Schedule of Expenditures of Federal Awards For the year ended December 31, 2011 Amount passed through Total CFDA to federal Federal grantor/pass‐through grantor Pass‐through grantor number Program title number subrecipients expenditures U.S.
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