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Year Report Code Finding Recommendation Moss Adams Determination Notes 133 1 2017 17-ICTPC
Payment documentation requirements do not provide
maximum
controls.
Consider increasing the payment documentation
requirements.
Closed upon review of P-Card policy, which restricts "any purchases which contain elements of labor, installation, repair, or modification which are performed on City
property"
124 2 2017 17-ICTPC
Not all card statements were signed by the cardholder. Re-emphasize the importance of signing monthly statements.
Requirement to sign monthly p-card statements is indicated in policies and procedures as well as training.
134 2 2017 17-ICTPC
The City’s current P-Card policy does not require
documentation
that shipped or delivered items go to a City address unless an
explanation is provided.
Increase shipping and delivery address requirements. Closed upon review of P-card policy, which indicates that purchase receipts always reference a shipping address or delivery location and includes what to do if it does not have this information.
125 3 2017 17-ICTPC
Not all receipts for transactions included required
documentation.
Remind cardholders and supervisors about documentation
requirements. Will Wong was promoted as Utilities Director in 2018; interviews for a 2024 internal audit indicate enhanced
collaboration and communication.
135 3 2017 17-ICTPC
Current asset controls are not addressed within the City’s PCard
Manual.
Update the City’s P-Card Manual.
Asset Capitalization Policy addresses asset controls
126 4 2017 17-ICTPC
Not all P-Card transactions were appropriate given the
existence of blanket purchase orders or annual agreements in place with certain vendors.
Re-emphasize the importance of reviewing the list of the City’s
BPOs and annual agreements.
Closed upon review of P-Card policy, which restricts "any purchases which have an existing blank purchase order
and/or department assigned annual agreement"
136 4 2017 17-ICTPC
Some P-Card transactions did not have clear business
purposes.
Consider increasing documentation requirements to include an
explanation of business purpose.
Closed upon review of P-card policy, which includes
guidance around which purchases require a clear business purpose.
127 5 2017 17-ICTPC
Some purchases included labor, installation, or repair
services,
which are not permitted expenditures with P-Cards.
Clarify language related to restriction on services, labor, and installation.
Closed upon review of P-Card policy, which restricts "any purchases which contain elements of labor, installation, repair, or modification which are performed on City
property"
137 5 2017 17-ICTPC
Pre-approval may not beobtained from the Information
Technology (IT) Department for all technology purchases.
Clarify P-Card manual regarding technology purchase
requirements. Closed upon review of P-card policy, which requires IT related purchases to get pre-approval for each instance of purchase.
128 6 2017 17-ICTPC
Not all travel-related P-Card purchases were included on travel expense claims.
Implement additional processes to strengthen controls
during
reconciliation of the P-Card statement and the travel
expense
claim.
Last revision of the travel policy was 12/12/23. the
Reciliation between travel expense claims and the City's procurement card has been documented.
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Year Report Code Finding Recommendation Moss Adams Determination Notes 138 6 2017 17-ICTPC
The City does not provide guidance about some types of
expenditures to ensure prudent use of public funds.
Update the P-Card manual to provide more comprehensive
guidance about other types of purchases including food and employee recognition events.
Closed upon review of P-card policy, which includes a note about how to handle food and employee recognition
purchases.
129 7 2017 17-ICTPC
Required price comparisons were not performed for all
items
available through the City’s contract with Office Depot.
Improve compliance with Office Depot price comparisons.
P-Card policy mentions the requirement that office supplies must be ordered through the lowest cost supplier.
139 7 2017 17-ICTPC
Some departments use shared P-Cards, and the City’s P-Card manual does provide adequate controls for this type of
usage.
Update the P-Card manual to specifically address the
processes
and procedures for shared P-Cards.
Closed upon review of P-card policy, which restricts sharing cards with other City staff and explains potential
exceptions..
130 8 2017 17-ICTPC
Not all required quotes were obtained for purchases over $1,000.
Continue to detect missing quotes and enforce noncompliance.
P-card policy indicates the need to obtain 3 quotes for items over $3,500
140 8 2017 17-ICTPC
Some current P-Card accounts may not be necessary, while others may be required.
Develop and implement a process to periodically review all PCards
accounts.
Closed upon review of P-card policy, which requires review of inactive accounts every 6 months.
141 9 2017 17-ICTPC
The City’s P-Card violation program may not be adequately defined to support strong enforcement action.
Strengthen the City’s enforcement program for violations of the
P-Card manual.
Closed upon review of P-card policy, which includes a
section on consequences for failure to comply with program policies and procedures.
106 1 2017 17-ICTTE
The City’s current policies and procedures do not specifically require documentation in writing for prior approval of all travel arrangements. Update the policy to include clear guidance for how approval in advance of travel arrangements should be
documented.
Last revision of the travel policy was 12/12/23. The City has added an authorization for travel section which outlines how to receive pre-approval to travel. An Event
Authorization Form is required to be complete for any
business travel.
117 1 2017 17-ICTTE
The City does not provide guidance about when travel time should begin and end in relation to the intended conference or training.
Update written policies to provide guidance about travel time.
Last revision of the travel policy was 12/12/23. The policy states when travel time should begin and end and what
types of reimbursments are allowed.
107 2 2017 17-ICTTE
Adequate and appropriate documentation was not provided in all travel expense packets.
Update the travel policy to include explicit direction about required supporting documentation and provide relevant
resources and training to support compliance.
Travel policy includes a listing of required supporting documentation.
118 2 2017 17-ICTTE
The expenses incurred for the same conference or training can vary significantly.
Develop and implement process to compare costs across
individuals attending same event and investigate certain variations.
Last revision of the travel policy was 12/12/23. The policy states that when Travel Expense Claim
packages are submitted by different staff for the same event the need to be reviewed and give a list of criteria in whish to review and compare.
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Year Report Code Finding Recommendation Moss Adams Determination Notes 108 3 2017 17-ICTTE
Not all travel advances were approved in accordance with the City’s policy.
Revise City policy regarding authorization of travel advances.
Last revision of the travel policy was 12/12/23. And
authorization and training of the process has been created. 119 3 2017 17-ICTTE
There is no formal process in place to compare the
authorized cost of a trip to the actual cost incurred on a trip.
Develop and implement a process to compare estimated
costs to actual costs and investigate significant deviations. Last revision of the travel policy was 12/12/23. The policy states that when Travel Expense Claim
packages are submitted they need to review th difference between the estimated costs and the actual costs.
109 4 2017 17-ICTTE
Not all travel-related p-card purchases were included on travel expense claims. Implement additional processes to strengthen controls during reconciliation of the p-card statement and the travel expense claim.
Last revision of the travel policy was 12/12/23. the
Reciliation between travel expense claims and the City's procurement card has been documented.
120 4 2017 17-ICTTE
Some individuals may not be requesting all reimbursements they are due but may not be officially forfeiting these funds either.
Add section in travel expense claim form for individuals to authorize their forfeiture of funds.
Travel policy requires all travel expenses to be part of the Travel Expense Claim packet, even if the amount if not owed to the traveler.
110 5 2017 17-ICTTE
Some meal reimbursements exceeded GSA rates or
otherwise were not compliant with the City’s policies.
Establish and implement an additional process to obtain approval for meals that exceed the established GSA rates.
Last revision of the travel policy was 12/12/23. Meal the exceeds established rates are requires a travel const
justification form to be filled out and must be approved the direct supervisor and department director or authorized designee.
121 5 2017 17-ICTTE
The City’s current policy lacks guidance with regard to claiming reimbursement for additional travel fees, such as, parking and resort fees.
Update the City policy to include more specific guidance in regard to additional fees commonly associate with travel. Last revision of the travel policy was 12/12/23. The policy has an entire section that list other reimbursable expenses, including things like bridge tolls, shuttle fees, parking fees, visa and passport expenses, etc.
111 6 2017 17-ICTTE
The City’s policy does not adequately address requirements for standardized notations about travel times to support accurate per diem calculations.
The City should update its policy to include documentation requirements regarding travel times on the travel expense claim forms.
Last revision of the travel policy was 12/12/23.Requirement regarding travel times have been outlines in the policy - 'when reviewing Travel Expense Claims packages one thing that is required to verify is the travel time and dates. 122 6 2017 17-ICTTE
Some discrepancies exist between the City’s current
Municipal Code and the City's policy regarding travel
expenses.
Update the City policy and Municipal Code section related to travel expenditures to eliminate discrepancies between the different sources of written guidance.
Administrative Directive 1.02 includes updated travel
policies.
112 7 2017 17-ICTTE
Some transportation expenses do not appear to have been the most economical and lack justification for why these methods were chosen.
The City should update its policy and enforce the
requirement to pursue the most advantageous method of
transportation
Last revision of the travel policy was 12/12/23.Requirement regarding the most advantageous method of transportation have been outlines in the policy - when reviewing Travel Expense Claims packages one thing that is required to verify is transportation. It also states that if travelers are traveling by means that aren't the economical that they will only be reimbursed up to the most economical means of
transportation.
113 8 2017 17-ICTTE
Travel expenses were claimed that exceeded the lodging
GSA rate without written documentation of a reason for an exception.
Reiterate the City’s requirement to provide documentation of good faith effort for lodging rates that exceed the
government or group rates.
Last revision of the travel policy was 12/12/23. The policy state that when the state of lodging exceeds the
government rate that they must demonstrate good faith
efforts to find median pricing lodging and obtain the
necessary approvals
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Year Report Code Finding Recommendation Moss Adams Determination Notes 114 9 2017 17-ICTTE
Some travel expense reimbursement claims included
requests for duplicate reimbursement for meals, when
meals were included as a part of the event attended. Update the City’s policy to provide additional direction regarding meal documentation.
Last revision of the travel policy was 12/12/23. The policy states that the ymust include reciepts and copy of agenda - the agenda must iclude times, days and when meals are
provided.
115 10 2017 17-ICTTE
Not all expense claims were submitted in a timely manner consistent with the City’s policy
Update the City’s policy to include consequences for late submissions and establish a process for monitoring and
enforcing compliance.
Last revision of the travel policy was 12/12/23. The policy states that they must submit the Travel
Expense Claim packet within 25 days and if they fail to do an addition Travel justification form is to be completed with all required signatures
116 11 2017 17-ICTTE
The City does not currently monitor and track instances of non-compliance with the travel policy, nor does it have a consistent enforcement protocol.
The City should update its current written policies and procedures relating to travel expenses to establish
consequences of noncompliance.
Last revision of the travel policy was 12/12/23. The policy list consequences for when staff on not in compliance with the travel policy.
144 3 2019 17-ISF
N/A Continue to adequately fund the Property Insurance ISF. The Property Insurance ISF continues to be funded appropriately based upon review of the funding worksheet. 145 4 2020 17-ISF
N/A Reduce overall liability through investments in risk management.
City performed an assessment of the Risk Division practices and has implemented improvements.
146 5 2021 17-ISF N/A Consider creating a trust to prefund employee benefit obligations. City established an OPEB Trust in 2021.
147 6 2022 17-ISF
N/A Develop a policy to adequately fund the EBF based on fund administrative costs, plus a target percentage of Annual Required Contribution (ARC) for retiree health contributions, plus a reasonable estimate, based on projected retirements, for leave cash-out. Discontinue the use of rate holidays to address budget deficits to stabilize the EBF.
The EBF is fully funded based on a review of the funding model.
153 12 2028 17-ISF
N/A Conduct a facilities condition assessment to fully quantify the deferred maintenance and capital needs to be
addressed.
FCA was completed in November 2024.
154 13 2029 17-ISF
N/A Revise the Property ISF methodology to adequately fund facilities maintenance, operations, and capital needs. A comprehensive fee based on per square-foot building
occupancy should be charged to departments to cover the complete costs of operating and maintaining the City’s
facilities.
The Property Insurance ISF continues to be funded
appropriately based upon review of the funding worksheet.
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Year Report Code Finding Recommendation Moss Adams Determination Notes 1 2017-001 2017 17-SAR
Per the City of Modesto procurement card policy, a
competitive quotation is required for all transactions
over a $1,500 threshold. The policy also establishes the following spending limits - $1,500 for single
transactions and a monthly limit of $4,500. Spending above these limits are allowed with pre-approval.
During our audit, out of a sample of 27 monthly employee procurement activity, we noted the following:
. Two cases over $1,500 that did not have competitive
quotation.
. Two cases where an employee spent over their
preapproved single transaction limit.
. One case where an employee spent over their preapproved monthly transaction limit.
We recommend the City strengthen internal controls over the procurement card process for collection of
competitive quotations and the monitoring of employee
procurement card limits. The City may improve the
monitoring of spending limits by comparing a listing of each employee and their standard single transaction limit and standard monthly transaction limit to their monthly
procurement card statement.
PROCUREMENT CARD POLICIES AND PROCEDURES MANUAL
7.27 was revised on 9/8/23 and lays out the process to do a temporary increase on a p-card. They also included the form that needs to be filled out and approved for the increased amount.
2 2017-002 2017 17-SAR
During the audit, it has come to our attention that certain purchasing policies and procedures were not being
followed. The purchasing policies and procedures are
essential to meeting the City's objectives in operational effectiveness and efficiency, reliable financial reporting, and compliance with laws, regulations and policies.
Some of the initial findings relate to a lack of clarity regarding administering contracts and purchasing
procedures, inadequate policies and oversight, inadequate training, lack of communication among departments,
staffing constraints, and unauthorized extensions and
contract adjustments. The City has proactively engaged
professional assistance in investigating these discrepancies in order to identify the causes of breakdown in internal controls. The next step is to take the necessary corrective actions in order to cure any deficiencies that need action and strengthen the existing internal controls to ensure compliance with the City's purchasing policies and
procedures.
We recommend the City continue its investigation of past contracts and make the appropriate changes to its
purchasing policies and procedures in order to strengthen the internal controls over this area. Also, the City should implement a monitoring and oversight process to ensure
adherence to purchasing policies and procedures as
designed. Purchasing Policy 7.5 and Purchasing Procedure Manual were updated in Nov. 2023. In the Purchasing Procedure
Manual it has a section on reporting and requisitions
needed which states the monthly monitoring report and
also provided additional purchasing guidance. Also reviewed was 3 of the monthly purchasing updates that is review with council and this seem efficient and covers new policy and produces and other topics related to purchasing at the city.
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Year Report Code Finding Recommendation Moss Adams Determination Notes 3 2017-003 2017 17-SAR
We reviewed 2 out of 3 subrecipient files and noted that 1 subrecipient did not have the universal identifier and SAM requirements in accordance with 2 CFR 25.200. Additionally, the City did not retain documentation to indicate whether it collected the subrecipients' unique entity identifier prior to awarding funds in accordance with 2 CFR 25.205.
The City did not have a process in place to ensure the
required information is communicated and collected,
nor did the City ensure its subrecipient maintain active SAM registration.
We recommend that the City should review all federal
statutes, regulations, and the terms and conditions of the federal award and determine whether or not policies and procedures exist and are operating effectively to ensure compliance with all requirements.
Further, the City should maintain adequate documentation that the unique entity identifier has been obtained.
Marked corrected in the 2018 Single audit report
4 2017-004 2017 17-SAR
The City did not perform inspections for the year ended June 30, 2017. However, the City has developed controls and
procedures to identify those units on which housing quality inspections are due to ensure the required inspections are performed. City staff developed a monitoring schedule and HOME units are scheduled to be inspected starting January 2018. This is a repeat finding since the single audit for the year ended June 30, 2015.
Due to management changes and reorganization, staff was unable to perform inspections.
During the fiscal year, the City's Citizens Housing and Community Development Committee approved HOME
policies and procedures, which were also subsequently
approved by the City Council. These policies and procedures require the City to perform required on-site inspections of HOME-assisted properties periodically, consistent with the Criteria noted above. We recommend that the City continue to evaluate the effectiveness of its current internal control policies to ensure that the required inspections of units are performed as housing quality inspections are due.
Marked corrected in the 2018 Single audit report
11 F1
2018-
2019 18_19-SCCGJ
Several high-level and interim positions within the City of Modesto have now been filled.
The City of Modesto should continue to maintain adequate staff who will enter specific contract information and
generate reports using the Oracle Computer System.
The purchasing Ord chart provided for the most recent
procurement audit shows the approved position and
employees in those positions. Also reviewed was the job descriptions for the following add positions assistant Buyer, Senior Buyer, Buyer, and purchasing manager.
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Year Report Code Finding Recommendation Moss Adams Determination Notes 12 F2
2018-
2019 18_19-SCCGJ
The number of staff positions within the City of Modesto currently meets the contract monitoring needs of the city.
The Finance Department should continue to conduct
monthly meetings to assure contract compliance.
2 of the monthly purchasing updates were reviewed and
are efficient and covers new policy and produces and other topics related to purchasing at the city.
13 F3
2018-
2019 18_19-SCCGJ
Staff now receive monthly training regarding standardized policies and procedures.
As required by Modesto City Charter and the Modesto
Municipal Code, regular meetings with all city division heads should occur to ensure that contracts nearing monetary or time limits are reported to the Modesto City Council
2 of the monthly purchasing updates were reviewed and
are efficient and covers new policy and produces and other topics related to purchasing at the city.
A monthly Purchasing email was provided that is sent to the City departments which includes all Department Directors.
This email is sent at the beginning of every month. It also included the most recent updates of all agreements,
Blankets, and Amazon spending.
14 F4
2018-
2019 18_19-SCCGJ
The purchasing Procedures manual has not been revised
since March 2007
Both of the Purchasing Division’s written policy and
procedures manuals should be finalized by September 30, 2019.”
Purchasing Policy 7.5 (original date of 11/1/2018) and
Purchasing Procedure Manual were both updated in Nov.
2023.
15 F5
2018-
2019 18_19-SCCGJ
The purchasing manual has not been revised since July 2009. Both of the Purchasing Division’s written policy and procedures manuals should be finalized by September 30, 2019.
Purchasing Policy 7.5 (original date of 11/1/2018) and
Purchasing Procedure Manual were both updated in Nov.
2023.
16 F6
2018-
2019 18_19-SCCGJ
The City of Modesto's purchasing division now has
safeguards in effect with regard to contract approvals
Staff responsible for purchases and contracts should follow the City of Modesto policy and procedures and the Modesto Municipal Code.
Purchasing Policy 7.5 (original date of 11/1/2018) and
Purchasing Procedure Manual were both updated in Nov.
2023. Reviewed purchasing training that covered these
policies.
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Year Report Code Finding Recommendation Moss Adams Determination Notes 17 F7
2018-
2019 18_19-SCCGJ
The City of Modesto's purchasing division now enters and monitors contract information within the Oracle Computer System.
Purchasing and finance department staff should receive
specific orientation and refresher training regarding
utilization of the Oracle Computer System.
Purchasing Policy 7.5 (original date of 11/1/2018) and
Purchasing Procedure Manual were both updated in Nov.
2023. Reviewed purchasing training that covered these
policies.
18 F8
2018-
2019 18_19-SCCGJ
The position of City Auditor remains vacant as of the date of this report.
The Modesto City Council should begin the process of
recruiting and hiring a new City Auditor as required by Modesto Municipal Code §902.1, no later than September
30, 2019.
Marked as Corrected in the 2022 Single Audit Report
165 6 2018 18-FUS
N/A Expand the central motor pool at City Hall by utilizing existing City vehicles and/or rental cars to provide access to vehicles that may be needed due to the surplusing of
underutilized vehicles.
Provided rental report for July 2024 - December 2024 of all central motor pool reservations
166 7 2018 18-FUS
N/A Utilize the State of California’s Statewide Travel Program for rental vehicles to supplement the City pool when units are out of service due to extensive repair work or for peak need periods.
Rental agreements apply government discounted rates.
167 8 2018 18-FUS
N/A Train employees on the guidelines and policies for
determining when to use a City vehicle, mileage
reimbursement, or a rental vehicle.
Reviewed Fleet Training and Traning Materials
168 9 2018 18-FUS
N/A Re-evaluate the composition of the shop loaner pool and discontinue the practice of charging customers for utilization of loaner pool vehicles.
Screenshot provided shows that a rental rate is applied to each vehicle and it shows the Hourly, Daily, Weekly and Monthly rates to rent a motor pool vehichle or equipment
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Year Report Code Finding Recommendation Moss Adams Determination Notes 169 10 2018 18-FUS
N/A Establish a new central heavy equipment pool,
supplemented with rentals, to provide access to equipment that may be needed due to the surplusing of underutilized equipment and require all requests for heavy equipment
rentals to be processed and approved through Fleet
Services
Screenshot provided shows that a rental rate is applied to each vehicle and it shows the Hourly, Daily, Weekly and Monthly rates to rent a motor pool vehichle or equipment 173 1 2018 18-PES
Decentralized Plan Check and Permitting Processes
Define and create an organized and centralized location of resources relevant to the varied permitting activities. eTRAKiT is used to track permit activities and a plan process review was provided and illustrates the process by which plans are reviewed and how to resubmit revised plans when necessary.
174 2 2018 18-PES
Reliance on Sole Source Employees Close to Retirement
Proactively strategize ways to incorporate succession
planning for key positions involved in permitting activities to ensure operational continuity and prevent the loss of
institutional knowledge.
Solar Plan and Water Heater Inspection checklists were
provided and are thorough in demonstrating everything that needs to be addressed during those inspections. A Process flow for development review process was also provided as a road map for project managers to ensure all steps occur during the review.
175 3 2018 18-PES
Early Stages of Outcome Performance Measuring and
Reporting
Review and identify more meaningful performance metrics related to permitting activity, and identify opportunities for sharing with City leadership and customers alike.
Monthly data from 21-24 was provided on community and
economic development projects. The data shows counts by month for topics such as, residential unit applications, new commercial applications, Permits issued- new commercial, Customer counts, all inspections completed, etc.
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Year Report Code Finding Recommendation Moss Adams Determination Notes 176 4 2018 18-PES
Significant CED Department Leadership Turnover
Support departmental stability by ensuring positions are filled timely, staff are provided sufficient training and support, and dedicate resources to developing managers
through coaching and training
Provided evidence of trainings that were approved and
attended, also a list of staff that attended. For 2024
177 5 2018 18-PES
Building Permit Plan Check Slowdowns from Incomplete
Applications
CED should develop a comprehensive checklist of all the items that must be included in pre-submittal and plan check.
Check lists and how to guide for eTRAKiT pre submittals and plan checks were provided. They layout the process and are comprehensive.
179 7 2018 18-PES
Heavy Reliance on Manual Processes and Paper
The selection and implementation of a new Permitting
System provides an opportunity to strengthen internal data and processes.
Monthly data from 21-24 was provided on community and
economic development projects. eTRAKiT System provides
an opportunity to strengthen internal data and processes.
The data shows counts by month for topics such as,
residential unit applications, new commercial applications, Permits issued- new commercial, Customer counts, all
inspections completed, etc.
182 10 2018 18-PES
No Formal Customer Feedback Mechanism in Place
Develop a simple yet meaningful process to solicit, collect, and analyze customer feedback on the different permitting process activities in order to facilitate ongoing continuous improvement efforts.
Customer feedback surveys have been created for
inspections and permitting and reports for each were
provided.
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Year Report Code Finding Recommendation Moss Adams Determination Notes 5 2018-001 2018 18-SAR
For one of the four projects we reviewed, we noted that one of the subcontractors did not submit the certified payroll reports prior to the date of testing. Furthermore, one
contractor and one subcontractor did not submit their
certified payroll reports within the required timeframe.
The City did not have a review process in place to ensure that the required certified payroll reports were submitted for all projects and by all covered contractors and
subcontractors.
We recommend that the City develop a periodic review of all projects’ certified payroll reports to ensure that all
contractors and subcontractors are submitting the required reports within the required timeframe.
Marked corrected in the 2019 Single audit report
6 2018-002 2018 18-SAR
While performing audit procedures over the City’s
procurement process for rehabilitation projects, we noted that the City did not adequately advertise the bids for a sufficient amount of time before the date set for opening the bids.
Although the projects did not reach a limit that would
require the use of sealed bids, it was the City’s practice to use sealed bids when procuring housing rehabilitation
services from contractors. This caused confusion as to what procedures should be used.
We recommend that the City update their current policies to match their current practices when soliciting for housing rehabilitation services.
Marked corrected in the 2019 Single audit report
7 2018-003 2018 18-SAR
While performing audit procedures over the City’s
subrecipient monitoring, we noted that the City did not include all of the required information at the time of the subaward as required by federal guidelines.
The City has not updated its contracts/agreements between the City and its subrecipients to comply with the changes made to the single audit requirements by the
implementation of the Uniform Guidance
We recommend that the City update their subrecipient
contracts to include all of the requirements of 24 CFR
200.331.
Marked corrected in the 2019 Single audit report
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Year Report Code Finding Recommendation Moss Adams Determination Notes 8 2019-001 2019 19-SAR
During our fieldwork, we noted the Citydid not have
adequate procedures to accurately report capital asset
additions and disposals/deletions as construction in
progress assets were completed; resulting in material audit adjustments and reclassificationsto properly capitalize completed projectsinto a depreciable asset baseand record depreciation expense.
Internal controls have not been suitably designed and
implemented over the construction in progress completion reportingprocess to ensure that completed projects were properly placed in service and/or deleted out of the
construction in progress accounts.
The Cityshould design and implement internal controls over capital assets to ensure that all balances are properly recorded, thus resulting in proper presentation with
generally accepted accounting principles (GAAP). We
recommend that the Cityimplement different levels of
internal review and/or consult with the City’s Public Works Department to ensure that completed construction-inprogress jobs are properly closed and moved to a depreciable asset base to ensure proper presentation and classification of capital assets in accordance with GAAP.
Marked as implemented in the 2020 Single Audit Report
9 2020-001 2020 20-SAR
During our testing of accounts payable, we noted invoices for goods/services incurred prior to the end of the fiscal year were not accrued in the financial statements resulting in a material adjustment.
Although the City’s accrual process resulted in the vast majority of the accruals being correctly accrued, the City unfortunately missed two material invoices which resulted in the material adjustment.
We recommend that City put an additional level of review over the accrual process and implement additional testing over possible missed expenses and liabilities to ensure that the City captures and accrues all necessary invoices as of year-end.
Marked as implemented in the 2021 Single Audit Report
25 R1 -
homeless
ness
2022 21_22-SCCGJ
More accountability needs to be introduced into the system.
The Community System of Care, the Stanislaus Homeless
Alliance, and the Community Services Agency should take the lead, demand verifiable performance, and focus funding and other resources on those agencies and organizations with demonstrable success. This should be done by jointly adopting a performance evaluation system prior to
allocation of the next round of 13 federal homeless funding.
Progress on achieving the eight goals set forth in the
Stanislaus 2021 Regional Strategic Plan to Address
Homelessness should be included in performance
evaluations.
The City provided a copy of the NOFA released in 2022 - the goal of the City of Modesto is to facilitate the construction, acquisition, rehabilitation, and/or preservation, of
affordable multifamily rental housing for extremely low- (30% AMI), very low- (50% AMI) and low-income (80% AMI) households or as specified by funding source requirements.
The City also provided their CAPER reports from 21-22 and 22-23 which reports on progress made on improving
neighborhoods, partnerships with community organizations, to provide affordable housing opportunities to those in need, improve living conditions, and the provision of
services for the homeless, including individuals with special needs. They also provided us with the data template they us to collect data from partnerships and community
organizations.
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Year Report Code Finding Recommendation Moss Adams Determination Notes 29 R1- Water
supply
and
demand
2022 21_22-SCCGJ
Modesto should adopt a more aggressive conservation
program to reduce its gallons per capita daily consumption and the severity of future rate increases.
Confirmed additional investment into water conservation program.
26 R2 -
homeless
ness
2022 21_22-SCCGJ
More focus should be given to preventing homelessness. To the extent there are funds not earmarked for other
purposes, in the budgeting process of each jurisdiction, priority should be given to allocating these funds for
affordable housing, substance abuse treatment, and mental health services.
The city provided information regarding the funding they have provided for beds and unit expansion of affordable housing.
The City also provided their CAPER reports from 21-22 and 22-23 which reports on financials - resources and
investments, expenditures, and financial summaries.
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Year Report Code Finding Recommendation Moss Adams Determination Notes 30 R2- Water
supply
and
demand
2022 21_22-SCCGJ
Modesto should better educate its citizens on the need to conserve so that when greater restrictions are required, the public is more accepting of the need.
Confirmed additional investment into water conservation education efforts.
27 R3 -
homeless
ness
2022 21_22-SCCGJ
All cities in the County should continually be encouraging the construction of significantly more affordable housing.
They should evaluate their plans, procedures, and
requirements with the goal of balancing community goals, standards, and aspirations with the need for affordable housing.
The City provided their Housing Plan from 2022 and then the Housing element and elements approved for 2023-2031. All the documents outline the cities effort to providing
affordable housing and housing choices for everyone.
The documents provided show the cities efforts to invest in and expand the number of affordable housing units. The
housing report provided developments and cost of the
additional 282 affordable housing units that have been
added to the city since 2020.
31 R3- Water
supply
and
demand
2022 21_22-SCCGJ
Modesto should accelerate its efforts to limit water system loss.
The City provided their water CIP projects from 2016-2025. since 2022 they have done eight (8) S&R water main
projects. The City also provided the Councils approval of Olea (water meter monitoring AR and Resolution in
December 2023.
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Year Report Code Finding Recommendation Moss Adams Determination Notes 28 R4 -
homeless
ness
2022 21_22-SCCGJ
All cities should report annually to the Community System of Care and Stanislaus Homeless Alliance on the steps they have taken to help produce more affordable housing.
The housing report provided developments and cost of the additional 282 affordable housing units that have been
added to the city since 2020.
10 2021-001 2021 21-SAR
Per audit procedures performed over expenditures charged to the Emergency Rental Assistance Program (the Program), we noted an invoice that was incorrectly calculated and charged to the program. The service charge was calculated on a combined federal and state program total, which
resulted in the City’s Program being overcharged. The
overcharge included costs that should have been allocated to the State funding programs as opposed to the federal program, resulting in questioned costs to the Program.
Although the City has sufficient internal control processes over expenditures, including proper review, approval and recording; the overcharge was due to the vendor providing one invoice which combined charges for both federal and state funded programs that was overlooked when the
invoice was submitted for payment to the federal program.
We recommend that management require vendors to split
charges and/or implement additional reviews when
processing payments for invoices with multiple funding
sources.
Marked as Corrected in the 2022 Single Audit Report
19 F1 2023 22_23-SCCGJ
The number of homeless in Stanislaus County fluctuates
from year to year but is increasing over time. This trend was exacerbated by the COVID-19 pandemic.
More accountability needs to be introduced into the system.
The Community System of Care, the Stanislaus Homeless
Alliance, and the Community Services Agency should take the lead, demand verifiable performance, and focus funding and other resources on those agencies and organizations with demonstrable success. This should be done by jointly adopting a performance evaluation system prior to
allocation of the next round of federal homeless funding.
Progress on achieving the eight goals set forth in the
Stanislaus 2021 Regional Plan to Address Homelessness
should be included in performance evaluations.
The City provided their CAPER reports from 21-22 and 22-23 which reports on progress made on improving
neighborhoods, partnerships with community organizations, to provide affordable housing opportunities to those in need, improve living conditions, and the provision of
services for the homeless, including individuals with special needs. They also provided us with the data template they us to collect data from partnerships and community
organizations.
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Year Report Code Finding Recommendation Moss Adams Determination Notes 20 F2 2023 22_23-SCCGJ
The most significant causes of homelessness are lack of affordable housing, substance abuse, and mental health.
More focus should be given to preventing homelessness. To the extent there are funds not earmarked for other
purposes, in the budgeting process of each jurisdiction, priority should be given to allocating these funds for
affordable housing, substance abuse treatment, and mental health services.
The City provided their CAPER reports from 21-22 and 22-23 which reports on financials - resources and investments, expenditures, and financial summaries.
21 F3 2023 22_23-SCCGJ
efforts to better coordinate the system of care are
underway. These include the Stanislaus Homeless Alliance at the policy level, and the Homeless Management Information System at the operational level.
All cities in the County should continually be encouraging the construction of significantly more affordable housing.
They should evaluate their plans, procedures, and
requirements with the goal of balancing community goals, standards, and aspirations with the need for affordable housing.
The documents provided show the cities efforts to invest in and expand the number of affordable housing units. The
housing report provided developments and cost of the
additional 282 affordable housing units that have been
added to the city since 2020.
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Report
Year Report Code Finding Recommendation Moss Adams Determination Notes 22 F4 2023 22_23-SCCGJ
Since over half of the homeless each year are in the care system for the first time, efforts to prevent homelessness have not been successful enough. Without greater
prevention success, homelessness cannot be reduced. All cities should report annually to the Community System of Care and Stanislaus Homeless Alliance on the steps they have taken to help produce more affordable housing.
The housing report provided developments and cost of the additional 282 affordable housing units that have been
added to the city since 2020.
23 F5 2023 22_23-SCCGJ
Despite enormous funding for homeless programs, and
despite the fact that there are many individual successes, overall the system to date has not reduced homelessness.
Subsequent civil grand juries are encouraged to monitor progress on these recommendations and consider a more indepth investigation into efforts to produce affordable housing.
The Homelessness Workshop provided was done in October
2023. The City demonstrates the current state of
homelessness, data around the City's and communities
accountability efforts, summary of the City's programming and initiatives, shelter and housing and what projects have been completed, are in construction, and are pending, and finally summaries of the current research and benchmarking the city has completed on safe housing and bridge housing.
This shows the City's efforts to monitor progress and
consider other efforts to produce affordable housing.
32 1 2024 24-FASWES
The span of control for the Forestry Manager is unusually high, which may be limiting their ability to support
employee career growth and development.
Continue to pursue transitioning two Crew Leader positions to supervisory positions to reduce span of control. City Council approved Forestry Reorg Plan with two additional supervisors on 11/12/2024.
34 3 2024 24-FASWES
Forestry employees reported understaffing in several areas. Consider adding equipment operators, inspectors, and an Administrative Office Analyst (AOA) to increase team
efficiency.
The city provided signed Council resolutions for funding of the forestry re-org and the funding will go in to effect for FY 24-25, specifically in Nov. 2024.
41A 10A 2024 24-FASWES
Technology limitations impact Forestry’s operations. Continue to adapt Lucity to act as an effective and efficient tree management system.
A screenshot from lucity shows a work order for Forestry inspection and includes address and scheudlign notes, etc. 41B 10B 2024 24-FASWES
Technology limitations impact Forestry’s operations. Continue to modernize processes, including migrating away from paper-based processes and moving requests online.
A GoModesto report provided for all the open requests that have been submitted. It groups them by department and
request type. It then shows the number of open request for each request type and the date range for open requests. As of 12/13/24 Forestry had 572 open requests since the start of July 2024.
42B 11B 2024 24-FASWES
Procurement delays are still impacting Forestry and Solid Waste’s ability to obtain necessary equipment, likely due to limited central procurement capacity and supply chain
issues.
Designate a procurement liaison in each division who can work with Procurement and Fleet to ensure that all
purchased specialty parts are the correct item.
Screenshot of the invite for the monthly fleet services meeting was provided - in the details of the meeting it states that they discuss any fleet services issue: sho, vehicle, replacements, etc.
38A 7A 2024 24-FASWES
Current staffing and equipment levels are not sufficient to address the City’s tree maintenance backlog and maintain a tree pruning cycle aligned with best practices.
Continue to contract out for additional capacity aimed at stump grinding, tree removal, and pruning. Consider
increasing these contracts.
City Budget documents indicate an increase in staffing and contractor spend due to available funding through Measure H.
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