071222-C-5sr&att — Long Beach City Council, July 12, 2022

CITY OF
LONG
July 12, 2022

HONORABLE MAYOR AND CITY COUNCIL
City of Long Beach
California
RECOMMENDATION:

Department of Financial Management
411 West Ocean Boulevard, 6th Floor
Long Beach, CA 90802
562 570-6425
C-5
Receive and file the Federal Single Audit for the Fiscal Year Ended September 30, 2021. (Citywide)

DISCUSSION
On May 3, 2022, the Financial Management Department submitted to the City Council the City of Long Beach's (City) Annual Comprehensive Financial Report and other separately issued financial reports and statements for the Fiscal Year Ended September 30, 2021 (FY 21 ), as required by the City Charter. The City's independent financial auditors complete their Single Audit Report only after the regular audit is complete, so it is attached to this letter several months later.

Federal Single Audit
The Federal Single Audit is required by the Office of Management and Budget (0MB) for municipalities receiving over $750,000 annually in federal funds. The Federal Single Audit for FY 21 conducted by KPMG resulted in no grant program-related questioned costs and covered the following major programs:
• Special Supplemental Nutrition Program for Women, Infants, and Children • Community Development Block Grant/Entitlement Grants
• Emergency Solutions Grant
• Highway Planning and Construction
• American Rescue Plan Act
• Emergency Rental Assistance Program
• Epidemiology & Lab Capacity Enhancing Detection
• Port Security Grant Program
• Airport Improvement Program
This matter was reviewed by Deputy City Attorney Anita Lakhani on June 9, 2022 and by Revenue Management Officer Geraldine Alejo on June 8, 2022.

HONORABLE MAYOR AND CITY COUNCIL
July 12, 2022
Page2

TIMING CONSIDERATIONS
City Council action on this item is not time critical.

FISCAL IMPACT
This recommendation has no staffing impact beyond the normal budgeted scope of duties and is consistent with existing City Council priorities. There is no fiscal or local job impact associated with this recommendation.

SUGGESTED ACTION:

Approve recommendation.

Respectfully submitted,
J<.e~ 4

KEVIN RIPER

DIRECTOR OF FINANCIAL MANAGEMENT
ATTACHMENT-SINGLE AUDIT REPORT FY21
APPROVED:

THOMAS B. MODICA

CITY MANAGER

CITY OF LONG BEACH, CALIFORNIA
Audit of Expenditures of Federal Awards Performed in
Accordance with the Uniform Guidance
Year Ended September 30, 2021
(With Independent Auditors’ Report Thereon)

CITY OF LONG BEACH, CALIFORNIA
Table of Contents
Page
Independent Auditors’ Report on Compliance for Each Major Federal Program; Report on Internal Control Over Compliance; and Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance 1
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 4
Schedule of Expenditures of Federal Awards 6
Notes to Schedule of Expenditures of Federal Awards 14
Schedule of Findings and Questioned Costs 15

Independent Auditors’ Report on Compliance for Each Major Federal Program; Report on Internal Control Over Compliance; and Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance
The Honorable Mayor and City Council
City of Long Beach, California:

Report on Compliance for Each Major Federal Program
We have audited the City of Long Beach, California’s (the City’s) compliance with the types of compliance requirements described in the Office of Management and Budget Compliance Supplement that could have a direct and material effect on each of the City’s major federal programs for the year ended September 30, 2021.

The City’s major federal programs are identified in the summary of auditors’ results section of the accompanying schedule of findings and questioned costs.

The City's financial statements include the operations of the Long Beach Transportation Company, the discretely presented component unit, which expended $31,442,415 in federal awards , which is not included in the City’s schedule of expenditures of federal awards for the year ended September 30, 2021. Our audit, described below, did not include the operations of the discretely presented component unit because Long Beach Transportation Company engaged other auditors to perform an audit in accordance with Title 2 U.S.

Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance).

Management’s Responsibility
Management is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs.

Auditors’ Responsibility
Our responsibility is to express an opinion on compliance for each of the City’s major federal programs based on our audit of the types of compliance requirements referred to above. 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 audit requirements of the Uniform Guidance. Those standards and the Uniform Guidance 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 City’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 on compliance for each major federal program. However, our audit does not provide a legal determination of the City’s compliance.

Opinion on Each Major Federal Program
In our opinion, the City complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended September 30, 2021.

KPMG LLP
Suite 1500
550 South Hope Street
Los Angeles, CA 90071-2629
KPMG LLP , a Delaware limited liability partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee.

2 Other Matters
The results of our auditing procedures disclosed an instance of noncompliance that is required to be reported in accordance with the Uniform Guidance and is described in the accompanying schedule of findings and questioned costs as item 2021-001. Our opinion on each major federal program is not modified with respect to these matters.

The City’s response to the noncompliance finding identified in our audit is described in the accompanying schedule of findings and questioned costs. The City is also responsible for preparing a corrective action plan to address each audit finding included in our auditors’ report. The City’s response and corrective action plan were not subjected to the auditing procedures applied in the audit of compliance and, accordingly, we express no opinion on the response or the corrective action plan.

Report on Internal Control Over Compliance
Management of the City is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the City’s internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, 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 City’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 cour se 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 a combination of deficiencies, in internal control over compliance, such that there is a 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. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.

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 material weaknesses or significant deficiencies and, therefore, material weaknesses or significant deficiencies may exist that have not been identified. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, we did identify a deficiency in internal control over compliance, described in the accompanying schedule of findings and questioned costs as items 2021-001, that we consider to be a significant deficiency.

The City’s response to the internal control over compliance finding identified in our audit is described in the accompanying schedule of findings and questioned costs. The City is also responsible for preparing a corrective action plan to address each audit finding included in our auditors’ report. The City’s response and corrective action plan were not subjected to the auditing procedures applied in the audit of compliance and, accordingly, we express no opinion on the response or the corrective action plan.

The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose.

3 Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance We have audited the financial statements of the government activities, the business -type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the City as of and for the year ended September 30, 2021, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements. We issued our report thereon dated March 29, 2022, which contained unmodified opinions on those financial statements. Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the basic financial statements. The accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis as required by the Uniform Guidance 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 basic 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 basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the schedule of expenditures of federal awards is fairly stated in all material respects in relation to the basic financial statements as a whole.

Los Angeles, California
June 24, 2022

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
The Honorable Mayor and City Council
City of Long Beach, California
We have audited, in accordance with the 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, 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 City of Long Beach, California (the City) as of and for the year ended September 30, 2021, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements, and have issued our report thereon dated March 29, 2022. Our report includes a reference to other auditors who audited the financial statements of Long Beach Public Transportation Company (the Company), which is the City’s only discretely presented component unit, as described in our report on the City’s basic 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 on separately by those auditors.

Internal Control Over Financial Reporting
In planning and performing our audit of the basic financial statements, we considered the City’s internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the basic financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.

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 entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City’s basic financial statements are free from 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 financial statements. 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 5 instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

Los Angeles, California
March 29, 2022

CITY OF LONG BEACH, CALIFORNIA
Schedule of Expenditures of Federal Awards
Year Ended September 30, 2021
Assistance Federal grantor/ Federal Passed
listing number pass-through entity disbursements/ through to Federal grantor/pass-through agency/program title (ALN) identifying number expenditures subrecipients Department of Agriculture Food and Nutrition Service:

Passed through the State of California Department of Health Services:

WIC Special Supplemental Nutrition Program for Women, Infants, and Children WIC Special Supplemental Nutrition Program for Women, Infants, and Children 10.557 Non-Cash Value $ 11,017,619 — WIC Special Supplemental Nutrition Program for Women, Infants, and Children 10.557 15-10061 4,580,485 — Total WIC Special Supplemental Nutrition Program for Women, Infants, and Children (10.557) 15,598,104 — Passed through the State of California Department of Health Services:

Summer Food Service Program for Children 10.559 19-81908V 203,800 — State Administrative Matching Grants for the Supplemental Nutrition Assistance Program 10.561 19-10327 705,875 38,262 Total Department of Agriculture Food and Nutrition Service 16,507,779 38,262 Department of Commerce Economic Development Administration:

Direct:

Economic Adjustment Assistance 11.307 07-49-05046 1,256,394 — COVID-19 Economic Adjustment Assistance 11.307 07-79-07579 300,928 — Total Department of Commerce Economic Development Administration 1,557,322 — Department of Housing and Urban Development:

Direct:

Community Development Block Grants/Entitlement Grants 14.218 B-17-MC-06-0522 64,012 — Community Development Block Grants/Entitlement Grants 14.218 B-18-MC-06-0522 224,022 — Community Development Block Grants/Entitlement Grants 14.218 B-19-MC-06-0522 602,068 — Community Development Block Grants/Entitlement Grants 14.218 B-20-MW-06-0522 6,782,881 — Community Development Block Grants/Entitlement Grants 14.218 B-20-MC-06-0522 2,891,659 — Community Development Block Grants/Entitlement Grants 14.218 PROGRAM INCOME 77,928 — Total Community Development Block Grants/Entitlement Grants Cluster (14.218) 10,642,570 — Emergency Solutions Grant Program 14.231 E-19-MC-06-0522 70,256 18,500 Emergency Solutions Grant Program 14.231 E-20-MW-06-0522 6,282,168 1,006,100 Emergency Solutions Grant Program 14.231 E-20-MC-06-0522 167,622 167,622 Total Emergency Solutions Grant Program (14.231) 6,520,046 1,192,222 Home Investment Partnerships Program 14.239 M-17-MC-06-0518 72,879,165 — Home Investment Partnerships Program 14.239 M-18-MC-06-0518 1,543,945 — Home Investment Partnerships Program 14.239 M-19-MC-06-0518 5,035 — Home Investment Partnerships Program 14.239 PROGRAM INCOME 2,342,074 — Total Home Investment Partnerships Program (14.239) 76,770,219 — Passed through the City of Los Angeles:

Housing Opportunities for Persons with AIDS 14.241 98256 1,464,585 — Direct:

Continuum of Care Program 14.267 CA0000U9D061900 355,858 355,858 Continuum of Care Program 14.267 CA0000U9D061907 6,795,781 4,170,214 Continuum of Care Program 14.267 CA0000U9D062008 1,776,928 1,776,928 Total Continuum of Care Program (14.267) 8,928,567 6,303,000 (Continued)6

Section 8 Housing Choice Vouchers 14.871 CA068VO $ 102,868,539 — COVID-19 Section 8 Housing Choice Vouchers 14.HCC CA068VO 3,212,734 — Total Section 8 Housing Choice Voucher Cluster 106,081,273 — Family Self-Sufficiency Program 14.896 FSS21CA3966 266,505 — Family Self-Sufficiency Program 14.896 FSS20CA3285 88,460 — Total Family Self-Sufficiency Program (14.896) 354,965 — Lead-Based Paint Hazard Control in Privately Owned Housing 14.900 CALHB0591-19 1,154,373 — Total Department of Housing and Urban Development 211,916,598 7,495,222 Department of the Interior:

Direct:

Water Desalination Research and Development 15.506 R15AC00086 42,460 — Reclamation States Emergency Drought Relief 15.514 R20AP00109 55,497 — Total Department of the Interior 97,957 —
Department of Justice:

Direct:

COVID-19 Coronavirus Emergency Supplemental Funding Program 16.034 2020-VD-BX-1444 208,531 — Passed through the State of California Office of Emergency Services:

Services for Trafficking Victims 16.320 2018-VT-BX-0019 154,167 — Passed through the California State University:

National Institute of Justice Research, Evaluation, and Development Project Grants 16.560 2019-R2-CX-0020 115,991 — Passed through the State of California Office of Emergency Services:

Paul Coverdell Forensic Sciences Improvement Grant Program 16.742 CQ19157240 48,705 — Paul Coverdell Forensic Sciences Improvement Grant Program 16.742 CQ20167240 19,489 — Total Paul Coverdell Forensic Sciences Improvement Grant Program (16.742) 68,194 — Direct:

Smart Prosecution Initiative 16.825 2019-YX-BX-0001 4,396 — Total Department of Justice 551,279 —
Department of Labor:

Passed through the State of California Employment Development Department:

WIOA Adult Program 17.258 AA011103 37,592 —
WIOA Adult Program 17.258 AA111013 1,129,671 —
WIOA Adult Program 17.258 AA011103 173,381 —
WIOA Adult Program 17.258 AA111013 89,340 —
1,429,984 —
(Continued)7

Passed through the State of California Employment Development Department:

Passed through the City of Los Angeles:

WIOA Adult Program 17.258 AA011103 $ 146,882 —
WIOA Adult Program 17.258 C-134844 (714) —
WIOA Adult Program 17.258 C-137191 458,429 —
Passed through the State of California Employment Development Department:

Passed through the City of Los Angeles:

Passed through Southeast Los Angeles County Workforce Board (SELACO):

WIOA Adult Program 17.258 N/A 4,741 —
Total WIA/WIOA Adult Program (17.258) 2,039,322 —
WIOA Youth Activities 17.259 C-129810 1,575 —
WIOA Youth Activities 17.259 C-129810 24 —
WIOA Youth Activities 17.259 K8106641 468,300 —
WIOA Youth Activities 17.259 C138844 191,195 —
661,094 —
Passed through the State of California Employment Development Department:

WIOA Youth Activities 17.259 AA011013 291,153 84,965
WIOA Youth Activities 17.259 AA111013 89 —
WIOA Youth Activities 17.259 K8106641 1,031,401 29,020 WIOA Youth Activities 17.259 AA211013 96,487 —
1,419,130 113,985
Total WIA/WIOA Youth Activities (17.259) 2,080,224 113,985 WIOA Dislocated Worker Formula Grants 17.278 AA111013 238,832 — WIOA Dislocated Worker Formula Grants 17.278 AA211013 19,339 — WIOA Dislocated Worker Formula Grants 17.278 AA111013 9,788 — WIOA Dislocated Worker Formula Grants 17.278 AA211013 52 — WIOA Dislocated Worker Formula Grants 17.278 AA111013 56,691 — COVID-19 WIOA Dislocated Worker Formula Grants 17.278 AA011013 493,336 — COVID-19 WIOA Dislocated Worker Formula Grants 17.278 AA011013 162,919 — WIOA Dislocated Worker Formula Grants 17.278 K9110023 800 — WIOA Dislocated Worker Formula Grants 17.278 K9110023 (38) — WIOA Dislocated Worker Formula Grants 17.278 AA111013 741,655 — WIOA Dislocated Worker Formula Grants 17.278 AA011013 4,715 — WIOA Dislocated Worker Formula Grants 17.278 AA011013 75,614 — WIOA Dislocated Worker Formula Grants 17.278 AA111013 78,868 — WIOA Dislocated Worker Formula Grants 17.278 AA111013 46,064 — (Continued)8

Passed through the City of Los Angeles:

WIOA Dislocated Worker Formula Grants 17.278 C-137191 $ 218,558 — WIOA Dislocated Worker Formula Grants 17.278 C138800 113,181 — WIOA Dislocated Worker Formula Grants 17.278 C-134844 (25) — WIOA Dislocated Worker Formula Grants 17.278 C-137191 8,818 — WIOA Dislocated Worker Formula Grants 17.278 C-T6719 63,809 — WIOA Dislocated Worker Formula Grants 17.278 T6847 30,422 — Total WIOA Dislocated Worker Formula Grants (17.278) 2,363,398 — Total WIOA Cluster 6,482,944 113,985
Direct:

H-1B Job Training Grants 17.268 HG-29534-16-60-A-6 1,116,053 43,432 Passed through the State of California Employment Development Department:

COVID-19 WIOA National Dislocated Worker Grants/WIA National Emergency Grants 17.277 AA011013 516,632 — Total Department of Labor 8,115,629 157,417
Department of Transportation:

Direct:

Airport Improvement Program 20.106 30601270452019 277,080 — Airport Improvement Program 20.106 30601270462020 5,771,636 — Airport Improvement Program 20.106 30601270482020 7,414,194 — Airport Improvement Program 20.106 30601270492020 864,049 — COVID-19 Airport Improvement Program 20.106 30601270512021 5,437,072 — COVID-19 Airport Improvement Program 20.106 30601270472020 3,632,389 — Total Airport Improvement Program (20.106) 23,396,420 — Passed through the State of California Department of Transportation:

Highway Planning and Construction 20.205 STPL 5108(175) 866,220 — Highway Planning and Construction 20.205 HSIPL-5108(190) 43,907 — Highway Planning and Construction 20.205 HSIPL-5108(188) 2,903 — Highway Planning and Construction 20.205 HSIPL-5108(178) 33,949 — Highway Planning and Construction 20.205 STPLR-5108(183) 597,627 — Highway Planning and Construction 20.205 CMLN-5108 (159) 84 — Highway Planning and Construction 20.205 STIPL-5108(199) 354,071 — Highway Planning and Construction 20.205 BHLS-5108(197) 11,414 — Highway Planning and Construction 20.205 BRLS-5108 (137) 549,561 — Highway Planning and Construction 20.205 ACNH 7101-807 1,672,643 — Highway Planning and Construction 20.205 ATPL-5108-182 373,928 — Highway Planning and Construction 20.205 ATPL-5108-184-Z301 1,915,790 — Highway Planning and Construction 20.205 5108-189 10,268,015 — Passed through the Los Angeles Metropolitan Transportation Agency:

Highway Planning and Construction 20.205 ATPL-5108-184-Z400 1,159,881 — Total Highway Planning and Construction Programs (20.205) 17,849,993 — (Continued)9

Passed through the State of California Department of Transportation:

State and Community Highway Safety 20.600 0521-0890-101 $ 133,324 — State and Community Highway Safety 20.600 DD21005 113,984 — Total State and Community Highway Safety Programs (20.600) 247,308 — Minimum Penalties for Repeat Offenders for Driving While Intoxicated 20.608 0521-0890-101 209,136 — National Priority Safety Programs 20.616 PS21028 202,073 — National Priority Safety Programs 20.616 DI21026 132,366 — Total National Priority Safety Programs (20.616) 334,439 — Interagency Hazardous Materials Public Sector Training and Planning Grants 20.703 319-40/HMEP19 9,328 — Total Department of Transportation 42,046,624 —
Department of Treasury:

Direct:

Equitable Sharing Program 21.016 N/A 314,771 —
COVID-19 Coronavirus Relief Fund 21.019 137191 134,438 — COVID-19 Coronavirus State and Local Fiscal Recovery Funds 21.027 N/A 71,785,227 — Emergency Rental Assistance Program (ERAP) 21.023 ERAE0209 10,245,998 — Passed through the State of California:

Emergency Rental Assistance Program (ERAP) 21.023 20-ERAP-00018 6,179,624 — Total Emergency Rental Assistance Programs (21.023) 16,425,622 — Total Department of Treasury 88,660,058 —
Environmental Protection Agency:

Direct:

National Clean Diesel Emissions Reduction Program 66.039 99T56001 469,680 469,680 Passed through the State of California Department of Health Services:

Beach Monitoring and Notification Program Implementation Grants 66.472 SWRCB0000000000D1914103 103,389 — Total Environmental Protection Agency 573,069 469,680
Department of Health and Human Services:

Passed through the County of Los Angeles:

Public Health Emergency Preparedness 93.069 PH-003348 819,832 — Direct:

Environmental Public Health and Emergency Response 93.070 NUE1EH001405 90,000 — Healthy Marriage Promotion and Responsible Fatherhood Grants 93.086 90ZJ0025 610,872 — Passed through the State of California Department of Health Services:

Project Grants and Cooperative Agreements for Tuberculosis Control Programs 93.116 2175 BASE00/ 2175FSIE00 NU52PS910219 47,775 — Project Grants and Cooperative Agreements for Tuberculosis Control Programs 93.116 2075 BASE00/2075FSIE00/2075ADDF00NU52PS910219 117,485 — Total Project Grants and Cooperative Agreements for Tuberculosis Control Programs (93.116) 165,260 — (Continued)10

Childhood Lead Poisoning Prevention Projects State and Local Childhood Lead Poisoning Prevention and Surveillance of Blood Lead Levels in Children 93.197 17-10224 $ 279,348 — Immunization Cooperative Agreements 93.268 17-10325 A03 1,636,075 — Passed through the County of Los Angeles:

Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323 PH-003348 4,878,897 — Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323 PH-003348 4,817,353 — Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323 PH-003348 49,199 — Total Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (93.323) 9,745,449 — Public Health Emergency Response:

Cooperative Agreement for Emergency Response:

COVID-19 Public Health Crisis Response 93.354 PH-003448 615,553 — COVID-19 Public Health Crisis Response 93.354 PH-003448 80,692 — Total Public Health Crisis Response (93.354) 696,245 — Direct:

COVID-19 Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises 93.391 1 NH75OT000004-01-00 201,426 — Passed through the State of California Department of Health Services:

Passed through the County of Los Angeles Department of Public Social Services:

Passed through the City of Los Angeles:

Temporary Assistance for Needy Families 93.558 C 137033 85,164 — Temporary Assistance for Needy Families 93.558 C 139451 29,717 — Passed through the State of California Department of Health Services:

Passed through the County of Los Angeles Department of Public Social Services:

Temporary Assistance for Needy Families 93.558 IA- 0214 138,237 — Temporary Assistance for Needy Families 93.558 IA- 0214 50,230 — Passed through the State of California Department of Health Services:

Passed through the County of Los Angeles Department of Public Social Services:

Passed through the City of Hawthorne/South Bay Workforce Investment Board:

Temporary Assistance for Needy Families 93.558 16-W129 (3, 423) — Total Temporary Assistance for Needy Families (93.558) 299,925 — Passed through the State of California Department of Health Services:

Medical Assistance Program 93.778 61-19Evrgrn (64,050) — Medical Assistance Program 93.778 N/A 96,256 —
Medical Assistance Program 93.778 N/A 163,286 —
Medical Assistance Program 93.778 N/A 69,940 —
Passed through the County of Los Angeles:

Medical Assistance Program 93.778 PH-002508-16 119,928 — Medical Assistance Program 93.778 PH-002508-17 42,702 — Total Medical Assistance Program (93.778) 428,062 —
(Continued)11

Passed through the County of Los Angeles:

HIV Emergency Relief Project Grants 93.914 PH-003753 $ 77,156 — HIV Emergency Relief Project Grants 93.914 PH-002900 58,720 — HIV Emergency Relief Project Grants 93.914 PH-002900 37,137 — HIV Emergency Relief Project Grants 93.914 PH-003754 474,301 — Total HIV Emergency Relief Project Grants (93.914) 647,314 — Passed through the State of California Department of Health Services:

HIV Care Formula Grants 93.917 18-10872 1,027,465 —
HIV Care Formula Grants 93.917 15-11059 140,442 —
COVID-19 HIV Care Formula Grants 93.917 19-11154 125,835 — Total HIV Care Formula Grants (93.917) 1,293,742 —
Passed through the State of California Department of Health Services:

HIV Prevention Activities Health Department Based 93.940 19-10424 270,474 — HIV Prevention Activities Health Department Based 93.940 PH-003492/NU62PS924569 284,251 — HIV Prevention Activities Health Department Based 93.940 PH-003082 W1-2 39,112 — HIV Prevention Activities Health Department Based 93.940 PH-003082 W2 6,104 — Total HIV Prevention Activities Health Department Based (93.940) 599,941 — Sexually Transmitted Diseases (STD) Prevention and Control Grants 93.977 20-10720 35,752 — Passed through the State of California Department of Health Services:

Maternal and Child Health Services Block Grant to the States 93.994 202060 140,673 — Maternal and Child Health Services Block Grant to the States 93.994 202060 613,281 — Maternal and Child Health Services Block Grant to the States 93.994 202160 115,229 — Maternal and Child Health Services Block Grant to the States 93.994 202160 410,916 — Maternal and Child Health Services Block Grant to the States 93.994 202016 279,896 — Total Maternal and Child Health Services Block Grant to the States (93.994) 1,559,995 — Total Department of Health and Human Services 19,109,238 — Department of Homeland Security:

Passed through the State of California - California Office of Emergency Services:

Passed through the County of Los Angeles:

Emergency Management Performance Grants 97.042 EMF-2019-EP-00003 78,170 — Emergency Management Performance Grants 97.042 2020-EP-00019 33,554 — Total Emergency Management Performance Grants (97.042) 111,724 — (Continued)12

Direct:

Port Security Grant Program 97.056 E
MW2018PU00587 $ 170,117 —
Port Security Grant Program 97.056 E
MW-2017-PU-00542 620,969 —
Port Security Grant Program 97.056 E
MW-2018-PU-00287 554,682 —
Port Security Grant Program 97.056 E
MW2016PU00124 138,893 —
Port Security Grant Program 97.056 E
MW2017PU00048 375,762 —
Port Security Grant Program 97.056 E
MW2018PU00090 552,533 —
Port Security Grant Program 97.056 E
MW2019PU00170 1,574,605 —
Port Security Grant Program 97.056 E
MW2020PU00043 242,753 —
Total Port Security Grant Program (97.056) 4,230,314 —
P
assed through the State of California - California Office of Emergency Services:

Passed through the City of Los Angeles:

Homeland Security Grant Program 97.067 E
MW-2017-SS-00083 9,417 —
Homeland Security Grant Program 97.067 18LA
0183 864,434 —
Homeland Security Grant Program 97.067 E
MW-2017-SS-00035 681,695 —
Homeland Security Grant Program 97.067 2020-S
S-00032 248,962 —
1,804,508 —
P
assed through the State of California - California Office of Emergency Services:

Passed through the County of Los Angeles:

Homeland Security Grant Program 97.067 2018-00054
520,566 —
Homeland Security Grant Program 97.067 E
MW-2019-SS-00035 261,034 —
781,600 —
T
otal Homeland Security Grant Program (97.067) 2,586,108 — T
otal Department of Homeland Security 6,928,146 —
T
otal Federal Expenditures $ 396,063,699 8,
160,581
13 CITY OF LONG BEACH, CALIFORNIA
Notes to Schedule of Expenditures of Federal Awards
September 30, 2021
14 (1) General
The accompanying schedule of expenditures of federal awards (the Schedule) presents the activity of all federal financial assistance programs of the City of Long Beach, California (the City). All federal financial assistance received directly from federal agencies, as well as federal financial assistance passed through to the City by other government agencies, has been included in the Schedule. The Schedule did not include federal expenditures of $31,442,415 for the year ended September 30, 2021 of the Long Beach Transportation Company (the Company), a discretely presented component unit of the City, as the Company engaged other auditors to perform audits in accordance with the Uniform Guidance. The City’s reporting entity is defined in note 1 to the City’s basic financial statements. (2) Summary of Significant Accounting Policies
Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. These items are reported as negative amounts within the Schedule and represent adjustments or credits made in the normal course of business to amounts reports as expenditures in prior years. (3) Community-based Loan Programs with Continuing Compliance The City considers loans advanced to eligible participants for the Community Development Block Grant/ Entitlement Grants (CDBG) and the Home Investment Partnerships Program (HOME) to have continuing compliance requirements. As such, the amounts reported in the Schedule for the CDBG and HOME programs include current-year disbursements as well as the balance of the beginning of the year of loans with continuing compliance requirements.

As of September 30, 2021, the balance of loans with continuing compliance requirements for the HOME program was $77,872,256.

As of September 30, 2021, the balance of the outstanding loans with continuing compliance requirements for the CDBG programs was $5,106,153.
(4) Food Instruments/Vouchers
Food instruments/vouchers expenditures represent the estimated value of the Special Supplemental Nutrition Program for Women, Infants, and Children food instruments distributed during the year as communicated by the State of California Department of Health Services. The food instruments/vouchers totaled $11,017,619 but do not represent cash expenditures in the City’s basic financial statements for the year ended September 30, 2021.
(5) Indirect Cost Rate
The City did not elect to use the 10% de minimis indirect cost rate as discussed in the Uniform Guidance Section 200.414.

CITY OF LONG BEACH, CALIFORNIA
Schedule of Findings and Questioned Costs
September 30, 2021
15 (Continued)
(1) Summary of Auditors’ Results
Basic Financial Statements
(a) Type of auditors’ report issued on whether the basic financial statements were prepared in accordance with generally accepted accounting principles: Unmodified (b) Internal control deficiencies over financial reporting disclosed by the audit of the basic f inancial statements:
• Material weaknesses: No
• Significant deficiencies: None Reported
(c) Noncompliance material to the basic financial statements: No Federal Awards
(d) Internal control deficiencies over major program disclosed by the audit:
• Material weaknesses: No
• Significant deficiencies: 2021-001
(e) Type of report issued on compliance for major programs: Unmodified (f) Audit findings that are required to be reported in accordance with 2 CFR 200.516(a): Yes (g) Major program:
• WIC Special Supplemental Nutrition Program for Women, Infants, and Children, ALN 10.557 • Community Development Block Grant/Entitlement Cluster, ALN 14.218 • Emergency Solutions Grant Program, ALN 14.231
• Airport Improvement Program, ALN 20.106
• Highway Planning and Construction, ALN 20.205
• Emergency Rental Assistance Program, ALN 21.023
• COVID-19 Coronavirus State and Local Fiscal Recovery Funds, ALN 21.027 • Epidemiology and Laboratory Capacity for Infectious Diseases (ELC), ALN 93.323 • Port Security Grant Program, ALN 97.056

CITY OF LONG BEACH, CALIFORNIA
Schedule of Findings and Questioned Costs
September 30, 2021
16 (Continued)
(h) Dollar threshold used to distinguish between Type A and Type B programs: $3,000,000 (i) Auditee qualified as a low-risk auditee: Yes
(2) Findings Relating to the Financial Statements Reported in Accordance with Government Auditing Standards
None
(3) Findings and Questioned Costs Relating to Federal Awards Finding 2021-001
Federal Program Title – COVID-19 Airport Improvement Program Assistance Listing No. – 20.106
Federal Agency – U.S. Department of Transportation – Direct Program Federal Award Number – 30601270472020
Grant Award Periods – May 7, 2020 to May 6, 2024
Compliance Requirement – Reporting
Criteria:

As set forth in 2 CFR 200.328, the Federal Financial Report, SF 425, must be collected with the frequency required by the terms and conditions of the federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances.

In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, establish and maintain effective internal control over the federal award that provides reasonable assurance that the nonfederal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award.

Conditions Found:

The City did not have an effective system of internal control in place to ensure the reports that are required to be submitted to the U.S. Department of Transportation were accurate. We selected a sample of nine reports and determined that one report omitted $18.4 million in payroll and payroll-related costs of which $3.6 million are costs incurred during the fiscal year ended September 30, 2021.

Questioned Costs:

There are no questioned costs.

CITY OF LONG BEACH, CALIFORNIA
Schedule of Findings and Questioned Costs
September 30, 2021
17 Context:

The City is required to submit annual federal financial reports related to the Airport Improvement Program that include all disbursements for direct charges for property and services; the amount of indirect expense incurred; and the net increase or decrease in the amounts owed by the recipient for (1) goods and other property received; (2) services performed by employees, contractors, subrecipients, and other payees; and (3) programs for which no current services or performance are required.

Cause and Effect:

City management indicated that interpretation of the reporting requirements was that payments made to employees for services provided were required to be omitted from the SF 425 report. As a result, the reports submitted omitted $18.4 million in payroll and payroll-related costs.

Repeat Finding:

A similar finding was not reported in the prior-year audit.

Statistical Sampling:

The sample was not intended to be, and was not, a statistically valid sample.

Recommendations:

We recommend the City strengthen processes and internal controls to ensure the City has an effective internal control in place to ensure that reports are complete and accurate prior to submitting to the U.S.

Department of Transportation as required.

View of Responsible Official:

The subject Airport Improvement Program (AIP) grant for COVID-19 related funding was used solely for internal City payroll-related expenditures and debt service payments, which is different from other previous AIP grants received by the Airport Department. The misinterpretation of reporting requirements for the new grant led to an error on the Federal Financial Report SF 425. The Airport Department will be providing more training to staff that are involved with the preparation, review and approval of the reports to reduce the risk of misinterpreting reporting requirements. The Airport Department will also strengthen internal controls by requiring at least two levels of review for Federal Financial Report SF 425, prior to submission.

These improvements to the process will ensure that reports are complete and accurate.

Long Beach City CouncilJuly 12, 2022

Long Beach City Council
July 12, 2022