FINANCIAL CONDITION ERIE COUNTY TABLE OF CONTENTS TITLE PAGE Schedule of Federal Awards Expenditures .................................................................................. 1 Notes to the Schedule of Federal Awards Expenditures .............................................................. 5 Independent Accountants’ Report on Compliance and on Internal Control Required by Government Auditing Standards................................................................7 Independent Accountants’ Report on Compliance with Requirements Applicable to Major Federal Programs and Internal Control Over Compliance in Accordance with OMB Circular A-133................................................................. 9 Schedule of Findings .................................................................................................................. 11 Schedule of Prior Audit Findings................................................................................................. 13 This page intentionally left blank FINANCIAL CONDITION ERIE COUNTY SCHEDULE OF FEDERAL AWARDS EXPENDITURES FOR THE YEAR ENDED DECEMBER 31, 2003 FEDERAL GRANTOR Pass Through Federal Pass Through Grantor Entity CFDA Non-Cash Program Title Number Number Disbursements Disbursements U.S. DEPARTMENT OF AGRICULTURE Passed Through Ohio Department of Education Nutrition Cluster: Food Distribution, Commodities 10.550 Detention Home 222-1652 $2,917 MRDD Board $2,034 School Breakfast Program: 10.553 Detention Home 07474005PU $9,716 National School Lunch Program: 10.555 MRDD Board 065961-03PU 1,577 Detention Home 074740-04PU 14,609 Total School Lunch Program 16,186 Total Nutrition Cluster 25,902 4,951 Direct Assistance Solid Waste Management Grant 41-023-0346400428 10.762 55,507 Total Department of Agriculture 81,409 4,951 U.S. DEPARTMENT OF JUSTICE Violent Crime Control Act 2001-DC-BX-0065 16.585 84,997 Total Violent Crime Control Act 84,997 Passed Through Ohio Attorney General's Office Crime Victims Assistance 2003VAGENE046 16.575 26,765 2003VAGENE476 16,916 2003VAGENE544 18,605 2003VAGENE544T 6,126 2004VAGENE046T 8,143 2004VAGENE476T 5,502 Total Crime Victims Assistance 82,057 Passed Through Ohio Office of Criminal Justice Services Byrne Formula Grant Program 2001-DG-F01-7367 16.579 25,645 01-DG-A01-7005 136,452 2002-DG-BO2-7135 39,232 Total Byrne Formula Grant Program 201,329 Juvenile Accountability Incentive Block Grants Program 2001-JB-013-A071 16.523 1,230 2001-JB-013-A162 10,318 2002-JB-013-A071 29,824 Total Juvenile Accountability Incentive Block Grants Program 41,372 Juvenile Justice and Delinquency Prevention 2001-JJ-D11-0073 16.540 6,030 (Continued) 1 FINANCIAL CONDITION ERIE COUNTY SCHEDULE OF FEDERAL AWARDS EXPENDITURES FOR THE YEAR ENDED DECEMBER 31, 2003 (Continued) FEDERAL GRANTOR Pass Through Federal Pass Through Grantor Entity CFDA Non-Cash Program Title Number Number Disbursements Disbursements U.S. DEPARTMENT OF JUSTICE Passed Through Ohio Office of Criminal Justice Services Violence Against Women Formula Grant 2001-WF-VA5-8114 16.588 7,881 2002-WF-VA5-8114 32,902 Total Violence Against Women Formula Grant 40,783 Subtotal Pass-Through Programs 371,571 Total Department of Justice 456,568 U.S. DEPARTMENT OF TRANSPORTATION Passed Through Ohio Department of Transportation Highway Planning and Construction G010(075) 20.205 577,363 Total Department of Transportation 577,363 U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT Passed Through Ohio Department of Development Community Development Block Grant- 14.228 Small Cities Program and Emergency Shelter Program B-F-99-021-1 327 B-F-00-021-1 7,521 B-E-00-021-1 10,000 B-F-01-021-1 182,114 B-C-02-021-2 255,430 B-F-02-021-1 75,246 B-L-02-021-1 14.231 58,500 Total Department of Housing and Urban Development 589,138 U.S. DEPARTMENT OF LABOR Passed Through Ohio Department of Jobs and Family Services Workforce Investment Act Cluster: Workforce Investment Act Adult Program 17.258 142,345 Workforce Investment Act Youth Program 17.259 147,734 Workforce Investment Dislocated Worker Program 17.260 87,035 Total Department of Labor - Workforce Investment Act Cluster 377,114 (Continued) 2 FINANCIAL CONDITION ERIE COUNTY SCHEDULE OF FEDERAL AWARDS EXPENDITURES FOR THE YEAR ENDED DECEMBER 31, 2003 (Continued) FEDERAL GRANTOR Pass Through Federal Pass Through Grantor Entity CFDA Non-Cash Program Title Number Number Disbursements Disbursements U.S. DEPARTMENT OF EDUCATION Passed Through Ohio Department of Education Special Education Cluster: Special Education- Grants to States 065961-6B-SF-2003P 84.027 5,838 Special Education - Preschool Grants 065961-PG-S1-2003P 84.173 6,245 065961-C2S1-2003 24 065961-PG-S1-2004P 20,663 065961-C2S1-2004 203 Total Special Education - Preschool Grants 27,135 Total Special Education Cluster 32,973 Passed Through the Ohio Department of Health Special Education- Grants for Infants and Families with Disabilities 22-1-003-1-EG-03 84.181 52,760 Total Department of Education 85,733 U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES Passed Through Ohio Department of Mental Retardation and Development Disabilities Social Services Block Grant FY 03-04 93.667 70,984 Medical Assistance Program 780221 93.778 1,265,349 Passed Through Ohio Department of Public Safety Rural Access to Emergency Devices Grant 92.259 23,000 Total Department of Health and Human Services 1,359,333 U.S. DEPARTMENT OF GENERAL SERVICES ADMINISTRATION Passed through Ohio Secretary of State Election Reform Payments 39.011 43,412 Total Department of General Services Administration 43,412 U.S. DEPARTMENT OF HOMELAND SECURITY Passed Through Ohio Department of Public Safety State Domestic Preparedness Equipment Support Program 99 J809 97.004 2,006 01 J809 67,211 02 J809 4,009 2001-DG-H01-7622 25,521 Total State Domestic Preparedness Equipment Support Program 98,747 (Continued) 3 FINANCIAL CONDITION ERIE COUNTY SCHEDULE OF FEDERAL AWARDS EXPENDITURES FOR THE YEAR ENDED DECEMBER 31, 2003 (Continued) FEDERAL GRANTOR Pass Through Federal Pass Through Grantor Entity CFDA Non-Cash Program Title Number Number Disbursements Disbursements Public Assistance Grants FEMA-3187-EM-043U3PEC 97.036 4,860 Emergency Management Performance Grants EMC-2003-GR-7006 97.042 36,482 Total Department of Homeland Security 140,089 TOTAL FEDERAL AWARDS EXPENDITURES $3,710,159 $4,951 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THIS SCHEDULE. 4 FINANCIAL CONDITION ERIE COUNTY NOTES TO SCHEDULE OF FEDERAL AWARDS EXPENDITURES DECEMBER 31, 2003 NOTE A - SIGNIFICANT ACCOUNTING POLICIES The accompanying Schedule of Federal Awards Expenditures (the Schedule) summarizes activity of the County’s Federal award programs. The schedule has been prepared on the cash basis of accounting. NOTE B - FOOD DISTRIBUTION Nonmonetary assistance, such as food received from the U.S. Department of Agriculture, is reported in the Schedule at the fair market value of the commodities received and consumed. Cash receipts from the U.S. Department of Agriculture are commingled with State grants. It is assumed Federal monies are expended first. At December 31, 2003, the County had no significant food commodities in inventory. NOTE C - COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) REVOLVING LOAN PROGRAMS The County has established a revolving loan program to provide low-interest loans to businesses involved in economic development. The Federal Department of Housing and Urban Development (HUD) grants money for these loans to the County passed through the Ohio Department of Development. The initial loan of this money is recorded as a disbursement on the accompanying Schedule of Federal Awards Expenditures (the Schedule). Loans repaid, including interest, are used to make additional loans. Such subsequent loans are subject to certain compliance requirements imposed by HUD, but are not included as disbursements on the Schedule. These loans are collateralized by equipment and other assets. At December 31, 2003, the gross amount of loans outstanding under this program is $387,245. Delinquent amounts due are $147,852. NOTE D - MATCHING REQUIREMENTS Certain Federal programs require that the County contribute non-Federal funds (matching funds) to support the Federally-funded programs. The County has complied with the matching requirements. The expenditure of non-Federal matching funds is not included on the Schedule. NOTE E - U.S. DEPARTMENT OF HOMELAND SECURITY FEDERAL AWARDS The Federal Homeland Security Act of 2002 established the Department of Homeland Security (the Department) to consolidate functions of other Federal agencies related to homeland security. Effective January 24, 2003, the Department began to administer certain Federal awards the County previously received from other Federal agencies. The accompanying Schedule of Federal Awards 5 Financial Condition Erie County Notes to the Schedule of Federal Awards Expenditures Page 2 Expenditures report all such 2003 award amounts under the Department’s Catalog of Federal Domestic Assistance (CFDA) numbers. The purposes and compliance requirement of these programs has not changed. A comparison of the Federal agencies’ and CFDA numbers the County reported in its 2002 Schedule of Federal Award Expenditures compared with the Department’s CFDA numbers reported in the 2003 Schedule follows: CFDA No. Homeland used Security CFDA Previous Federal Agency in 2002 No. used in 2003 Federal Emergency Management Agency 83.552 97.042 6 INDEPENDENT ACCOUNTANTS’ REPORT ON COMPLIANCE AND ON INTERNAL CONTROL REQUIRED BY GOVERNMENT AUDITING STANDARDS Erie County 2900