Finance & Governance Committee
March 28, 2023

Written materials relating to an item on this agenda that are distributed to the legislative bodies within 72 hours before the item is to be considered at its regularly scheduled meeting will be made available for public inspection at the City Clerk’s Office, 300 West Third Street 4th Floor during customary business hours. Agenda reports are also on the City of Oxnard web site at www.oxnard.org.

In compliance with the Americans with Disabilities Act, if you require special assistance to participate in a meeting, please contact the City Clerk’s Office at 385-7803. Notice at least 72 hours prior to the meeting will enable the City to reasonably arrange for your accessibility to the meeting.

Agenda Item Time Estimates include: (Minutes for Presentation + Council Discussion + Public Comment)

AGENDA

OXNARD CITY COUNCIL

FINANCE AND GOVERNANCE COMMITTEE
Council Chambers, 305 West Third Street
March 28, 2023
Regular Meeting - 5:00 to 6:30 PM

Zoom details to call-in for public comment during a meeting:

1. Dial Phone Number: (888) 475-4499

2. Enter Meeting ID: 828 3648 8221

3. Passcode: 158778

If you wish to speak during public comments or a particular item on the agenda, please sign-on by following the zoom call-in steps listed above. Once the presiding officer calls for public speakers, press *9 to raise your hand to inform the City Clerk you would like to speak during the public speaking section for that particular item on the agenda, while in the zoom waiting room. Press *6 when asked to unmute. Listen to the instructions provided virtually on the phone while on hold in the zoom waiting room. Please note that there is a slight time delay when viewing the meeting via television.

IN ACCORDANCE WITH ASSEMBLY BILL 2449, MEMBERS OF THE LEGISLATIVE BODY MAY MEET IN- PERSON OR REMOTELY. TO PARTICIPATE REMOTELY VISIT WWW.OXNARD.ORG.

To find out how you may provide public comment, please refer to the instructions below or at www.https://www.oxnard.org/city-meetings/.

The public may view the meeting from home on Spectrum channel 10, Frontier channel 35, or YouTube at Youtube.com/oxnardnews.

Video recordings of the meeting are typically available online following the meeting at the City’s website at www.oxnard.org/city- meetings.

*Please see the link for the Measure M pre-recorded presentation video for each item listed on this agenda.

YOU MAY PARTICIPATE IN THE MEETING IN THE FOLLOWING WAYS:

1. ATTEND THE MEETING AT THE LOCATION LISTED ABOVE: Submit a speaker card to the City Clerk.

2. EMAIL COMMENTS OR SIGN UP TO SPEAK REMOTELY BEFORE THE MEETING

a. Submit a request to speak remotely by no later than 3 p.m. on the day of the meeting by using the form available at www.oxnard.org/citymeetings.
b. Submit an email to [email protected] no later than 3 p.m. on the day of the meeting (indicate the agenda item number in the subject line). All email correspondence will be forwarded to the legislative body prior to the start of the meeting and made part of the legislative record.
c. Contact the City Clerk’s Office at (805) 385-7803 to submit your request.

3. PROVIDING PUBLIC COMMENTS REMOTELY DURING THE MEETING 1 OXNARD CITY COUNCIL: FINANCE & GOVERNANCE COMMITTEE
March 28, 2023 - Page 2

a. To provide public comment during the meeting dial (888) 475-4499 and enter the Meeting ID and Passcode listed above as the Zoom details for this meeting. When the presiding officer announces the particular item on the agenda you want to speak on, press *9 to raise your hand while in the zoom waiting room. Once called on, press *6 to unmute your phone.
b. Public comments on agenda items will be taken following the announcement of the item. After the item is announced, members of the public may register or otherwise be recognized for the purpose of providing public comment.

Please review the Zoom instructions on the registration page to help ensure there are no technical difficulties during your comments and help you understand public comment procedures using Zoom. Detailed participation instructions can be found at www.oxnard.org/city-meetings.

In the event of a disruption which prevents a legislative body of the City of Oxnard from broadcasting a meeting using a call-in option or internet-based service option, or in the event of a disruption within the City’s control which prevents members of the public from offering public comment using the call-in option or internet-based service option, the legislative body shall take no further action on items appearing on a meeting agenda until public access to the meeting via the call-in option or internet-based service option is restored. However, if any of the broadcast options are disrupted, but any of the other broadcast options is still available to the public, the legislative body may take further action on items appearing on a meeting agenda without waiting for the disrupted broadcast option(s) to be restored.

* The City has filed pre-election and post-election lawsuits regarding the validity of Measure M.

A. ROLL CALL, POSTING OF AGENDA, FLAG SALUTE
Consideration of Teleconference Participation pursuant to Assembly Bill 2449.

B. PUBLIC COMMENTS ON ITEMS NOT ON THE AGENDA

A person may address the legislative body only on matters not appearing on the agenda and within the subject matter jurisdiction of the legislative body. Speaker requests shall be submitted as set forth on the first page of this agenda. Speakers are limited to three minutes. After 30 minutes, if all speakers have not had the opportunity to speak, the remaining speakers will be given an opportunity to speak prior to adjournment of the meeting. The legislative body cannot enter into a detailed discussion or take action on any items presented during public comments at this time. Such items may only be referred to the City Manager/Executive Director/Secretary for administrative action or scheduled on a subsequent agenda for discussion. Persons wishing to speak on public hearing items should do so at the time of the hearing.

C. CONSENT AGENDA

1. City Clerk Department
SUBJECT: Approval of Minutes.

RECOMMENDATION: That the Finance & Governance Committee approve the minutes of the February 28, 2023 regular meeting as presented.

Contact: Rose Chaparro, (805) 385-7805
D. REPORTS

1. Finance Department
SUBJECT: Presentation of Single Audit Report. (20 Minutes)

RECOMMENDATION: That the Finance and Governance Committee receive the 2022 Single Audit Report from the audit firm Eadie + Payne and recommend staff forward presentation to the City Council.

(Eadie + Payne Presentation will be live upon consultant's request).

Contact: Denise Olson, (805) 200-5400

2. Finance Department
2 OXNARD CITY COUNCIL: FINANCE & GOVERNANCE COMMITTEE
March 28, 2023 - Page 3

SUBJECT: Update on the Corrective Action Plan (CAP) for Closing Past Audit Findings. (10 minutes)

RECOMMENDATION: That the Finance and Governance Committee receive an update on the Corrective Action Plan (CAP) for closing past audit findings and recommend staff forward the presentation to City Council.

Please click the following link to view the required Measure M pre-recorded presentation video: https://youtu.be/2ZomiRAeg50
Contact: Denise Olson, (805) 200-5400

3. Information Technology Department
SUBJECT: Purchase of Microsoft Software and Licensing. (10 minutes)

RECOMMENDATION: That the Finance and Governance Committee recommend that City Council approve and the Mayor execute an agreement and purchase order with an authorized Microsoft licensing service provider (reseller), "piggybacking" off of County of Riverside Microsoft Enterprise Agreement #8084445, for an amount not-to-exceed $2,028,260 for the continued use and purchase of Microsoft products for the three year agreement term of May 1, 2023, to April 30, 2026.

Please click the following link to view the required Measure M pre-recorded presentation video: https://youtu.be/j3J2uNeZZIA
Contact: Helen Miller, (805)385-7446
E. ITEMS FOR FUTURE AGENDAS

F. ADJOURNMENT

3 FINANCE AND GOVERNANCE COMMITTEE

AGENDA REPORT

CONSENT AGENDA
AGENDA ITEM NO. C.1

DATE: March 28, 2023

TO: Finance & Governance Committee

FROM: Rose Chaparro, City Clerk, (805) 385-7805, [email protected]

SUBJECT: Approval of Minutes.

RECOMMENDATION

That the Finance & Governance Committee approve the minutes of the February 28, 2023 regular meeting as presented.

BACKGROUND

Approval of Minutes.

STRATEGIC PRIORITIES

This agenda item is a routine operational item.

FINANCIAL IMPACT

There is no financial impact.

Prepared by: Rose Chaparro, City Clerk

ATTACHMENTS

1. MINUTES 02 28 2023 Finance & Governance

4 MINUTES

OXNARD CITY COUNCIL

FINANCE AND GOVERNANCE COMMITTEE
Regular Meeting
FEBRUARY 28, 2023

A. ROLL CALL, POSTING OF AGENDA, FLAG SALUTE
At 5:04 p.m., Chair John C. Zaragoza called to order the regular meeting of the Oxnard City Council Finance and Governance Committee in the City Hall Council Chambers at 305 W. Third Street, Oxnard, California. The City Clerk called the roll and announced the posting of the agenda. Chair Zaragoza , Member Gabriela Basua; and Member Gabriel (Gabe) Teran were present in person.

Staff members present in person were Alexander Nguyen, City Manager ; Shiri Klima, Deputy City Manager; Stephen M. Fischer, City Attorney ; Denise Olson, Interim Chief Financial Officer; Mark Sewell, Assistant Chief Financial Officer ; Dee Lai, Ass istant City Clerk and Rose Chaparro, City Clerk.

Andy Bhatnagar , Vice President at Kreative Core Technologies participated via videoconference.

B. PUBLIC COMMENTS ON ITEMS NOT ON THE AGENDA (None received.)

C. CONSENT AGENDA

1. City Clerk Department
SUBJECT: Approval of Minutes.

RECOMMENDATION: That the Finance & Governance Committee approve the minutes of the February 14, 2023 regular meeting as presented.

It was moved by Memb er Teran, seconded by Member Basua , to app rove the Information/Consent item as presented. VOTE: Basua, Teran, and Zaragoza voted in favor; the motion carried 3-0.

D. REPORTS

1. City Manager Department

SUBJECT: Risk to the ERP Project related to Aaron Starr Lawsuit preventing City from Obtaining Council-Approved Bonds; Fifth Amendment to Project Management Contract; and Annual Report.

RECOMMENDATION: That the Finance and Governance Committee recommend that the City Council:

1. Consider approving using up to $2,500,000 from Fiscal Year 2022-23 General 5 FEBRUARY 28, 2023 OXNARD CITY COUNCIL PAGE 2

FINANCE & GOVERNANCE COMMITTEE

Fund to cash fund the portion of all FY 2022-23 Enterprise Resource Planning (ERP) project expenditures in excess of the initial bond proceeds received in prior fiscal years (with additional FY 2023-24 General Fund as listed in budget to cash fund the FY 2023-24 ERP project expenditures if litigation remains pending that prevents City from issuing bonds); and

2. Approve and authorize the Mayor to execute a Fifth Amendment to the Professional Services Agreement with Kreative Core Technologies Corp (9431-21-FN) in the amount of $2,120,000 for a new not to exceed contract amount of $4,720,000 and to extend the term from December 31, 2023, to December 31, 2024, for Project Management Services related to the Human Capital Management (HCM), Energov, Enterprise Asset Management (EAM), and Utility Billing phases of the City’s multi-year Enterprise Resource Planning (ERP) implementation; and

3. Receive and file the ERP system annual report.

Shiri Klima, Deputy City Manager introduced Mark Sewell, Assistant Chief Financial Officer and Andy Bhatnagar, Vice President with Kreative Core Technologies who presented and answered the Committee’s questions. No public comments were received. Discussion ensued among the Committee and staff.

It was mo ved by Member Basua, seconded by Member Teran, to approve the recommended action as presented. VOTE: Basua, Teran, and Zaragoza voted in favor; the motion carried 3-

0. E. ITEMS FOR FUTURE AGENDAS

Member Teran requested that an item be placed on a future meeting agenda to conduct a broader discussion on how this lawsuit can affect other future bonded items.

F. ADJOURNMENT
There being no further business on the agenda, and without objection, Chair Zaragoza adjourned the meeting at 5:30 p.m.

ROSE CHAPARRO JOHN C. ZARAGOZA
City Clerk Chair

6 FINANCE AND GOVERNANCE COMMITTEE

AGENDA REPORT

REPORTS
AGENDA ITEM NO. D.1

DATE: March 28, 2023

TO: Finance & Governance Committee

FROM: Denise Olson, Interim Chief Financial Officer, (805) 200-5400, [email protected]

SUBJECT: Presentation of Single Audit Report. (20 Minutes)

RECOMMENDATION

That the Finance and Governance Committee receive the 2022 Single Audit Report from the audit firm Eadie + Payne and recommend staff forward presentation to the City Council.

(Eadie + Payne Presentation will be live upon consultant's request).

BACKGROUND

The Single Audit is a rigorous, organization-wide audit of the City’s grant funded programs that expend $750,000 or more of Federal grants or assistance. The objective of the Single Audit is to provide assurance to federal government as to the management and use of such funds by the City. The audit is performed by the City’s independent auditor, Eadie + Payne, LLP, and the report is issued annually showing the City of Oxnard’s expenditures of Federal awards. Eadie + Payne, LLP will present its audit opinion of the City of Oxnard Single Audit Report for fiscal year ending June 30, 2022.

STRATEGIC PRIORITIES

This agenda item supports the Organizational Effectiveness strategy. The purpose of the Organizational Effectiveness strategy is to reinforce, stabilize, improve, and strengthen the organizational foundation of the City in order to build a modern, high-functioning City government that effectively and efficiently supports the operating departments in providing high-quality services and programs for our residents and businesses.

FINANCIAL IMPACT

There is no financial impact.

Prepared by: Beth Vo, Assistant Chief Financial Officer

ATTACHMENTS

1. Single Audit Report

2. Single Audit Presentation

7 SINGLE AUDIT
REPORT
FISCAL VEAR ENDED JUNE 30, 2022
8 CITY OF OXNARD

CONTENTS
JUNE 30, 2022
PAGE

Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ................. 1 Independent Auditor's Report on Compliance for Each Major Program; Report on Internal Control over Compliance in Accordance with Uniform Guidance; and Report on the Schedule of Expenditures of Federal Awards Required by the Uniform Guidance ...................... 3 Schedule of Expenditures of Federal Awards and Schedule of Findings and Questioned Costs Schedule of Expenditures of Federal Awards ........................... 7 Notes to the Schedule of Expenditures of Federal Awards .................... 1 0 Schedule of Findings and Questioned Costs ........................... 1 1 Schedule of Prior Audit Findings .................................. 1 4 9 3880 Lemon St., Ste. 300
Riverside, CA 92501
P.O. Box 1529
Riverside, CA 92502-1529
951-241-7800
www.eadiepaynellp.com
1 INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND

ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS

PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS The Honorable City Council
City of Oxnard
Oxnard, California
We have au
dited, 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, each major fund, and the aggregate remaining fund information of the City of Oxnard, California (City), as of and for the year ended June 30, 2022, and the related notes to the financial statements, which collectively comprise the City's basic financial statements, and have issued our report thereon dated January 19, 2023. Our report includes a reference to other auditors who audited the financial statements of Oxnard Housing Authority, 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 financial statements, we considered the City's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the 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. 10 2
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 preceding paragraph and was not designed to identify all deficiencies in inte rnal control over financial reporting that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified. 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 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 determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion.

The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

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 entity'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 entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

Riverside, California
January 19, 2023
11 3880 Lemon St., Ste. 300
Riverside, CA 92501
P.O. Box 1529
Riverside, CA 92502-1529
951-241-7800
www.eadiepaynellp.com
-3-
INDEP

ENDENT AUDITOR'S REPORT ON COMPLIANCE FOR
EACH MAJOR PROGRAM; REPORT ON INTERNAL CONTROL OVER
COMPLIANCE IN ACCORDANCE WITH UNIFORM GUIDANCE; AND REPORT ON THE

SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS REQUIRED BY

THE UNIFORM GUIDANCE
The Honorable City Council
City of Oxnard
Oxnard, California
Report on Compliance for Each Major Federal Program
We have audited City of Oxnard's (City) compliance with the types of compliance requirements identified as subject to audit in the OMB Compliance Supplement that could have a direct and material effect on each of the City's major Federal programs for the year ended June 30, 2022. The City's major Federal programs are identified in the summary of auditor's results section of the accompanying schedule of findings and questioned costs.

The City's basic financial statements include the operations of the Oxnard Housing Authority, which expended $
26,175,745 in Federal awards during the year ended June 30, 2022 which is not included in the City’s schedule of expenditures of Federal awards. Our audit, described below, did not include the operations of the Oxnard Housing Authority, because it engaged other auditors to perform an audit in accordance with the Uniform Guidance.

In our opinion, the City complied, in all material respects, with the compliance requirements referred to above that could have
a direct and material effect on each of its major federal programs for the year ended June 30, 2022.

Basis for Opinion on Each Major Federal Program
We conduct
ed our audit of compliance in accordance with auditing standards generally accepted in the United States of America (GAAS); the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States (Government Auditing Standards); and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Our responsibilities under those standards and the Uniform Guidance are further described in the Auditor’s Responsibilities for the Audit of Compliance section of our report. 12 -4-
We are requ
ired to be independent of the City and to meet our other ethical responsibilities, in accordance with relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on compliance for each major federal program. Our audit does not provide a legal determination of the City’s compliance with the compliance requirements referred to above.

Responsibilities of Management for Compliance
Management is responsible for compliance with the requirements referred to above and for the design, implementation, and maintenance of effective internal control over compliance with the requirements of laws, statutes, regulations, rules and provisions of contracts or grant agreements applicable to the City’s federal programs.

Auditor’s Responsibilities for the Audit of Compliance
Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements referred to above occurred, whether due to fraud or error, and express an opinion on the City’s compliance based on our audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS, Government Auditing Standards , and the Uniform Guidance will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Noncompliance with the compliance requirements referred to above is considered material, if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about the City’s compliance with the requirements of each major federal program as a whole.

In performing an audit in accordance with GAAS, Government Auditing Standards , and the Uniform Guidance, we:
 Exercise professional judgment and maintain professional skepticism throughout the audit.  Identify and assess the risks of material noncompliance, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include ex amining, on
a test basis, evidence re
garding the City’s compliance with the compliance requirements referred to above and performing such other pro
cedures as we considered necessary in the
circumstances.
 Obtain an u
nderstanding of the City’s internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstances 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 the City’s internal control over compliance. Accordingly, no such opinion is expressed.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and any significant deficiencies and material weaknesses in internal control over compliance that we identified during the audit. 13 -5-
Report on Internal Control over Compliance
A deficiency in internal control over
compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of 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 Auditor’s Responsibilities for the Audit of Compliance section above and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies in internal control over compliance. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. However, material weaknesses or si gnificant deficiencies in internal control over compliance may exist that were not identified.

Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.

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.

Report on Schedule of Expenditures of Federal Awards
We have audited the financial statements of the gover nmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City as of and for the year ended June 30, 2022, and the related notes to the financial statements, which collectively comprise the City's basic financial statements. We issued our report thereon dated January 19, 2023, 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 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.

Riverside, California
March 13, 2023
14 -6-

SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
AND

SCHEDULE OF FINDINGS AND QUESTIONED COSTS
15 -7-

CITY OF OXNARD

SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2022
Federal
Assistance Program Total Total Amount
Federal Grantor/Pass-through Listing Identification Program Provided to Grantor/Program Title Number Number Expenditures Subrecipients U.S. Department of Housing and Urban Development
CDBG - Entitlement Grants Cluster
Direct Program
Community Development Block Grants/Entitlement Grants 14.218 B-21-MC-06-0534 918,409 $ 53,376$ B-19-MC-06-0534 49,749 -
B-17-MC-06-0534 187,640 -
COVID-19 Community Development Block Grants CARES Act 14.218 B-20-MW-06-0534 306,101 90,187 Total CDBG - Entitlement Grants Cluster 1,461,899 143,563 Direct Program
Emergency Solutions Grants Program 14.231 E-21-MC-06-0534 34,052 24,000 E-20-MC-06-0534 133,136 124,512
COVID-19 Emergency Solutions Grants - CARES Act 14.231 E-20-MW-06-0534 2,876,608 2,875,913 3,043,796 3,024,425
Direct Program
HOME Investment Partnership Program 14.239 M-21-MC-06-0526 134,191 - 134,191 -
Total U.S. Department of Housing and Urban Development 4,639,886 3,167,988 U.S. Department of Housing and Community Development
Passed through California Department of Housing and Community Development Emergency Rental Assistance Round 1 (Administrative Cost) 21.023 21-ERAP-10003 89,751 - 89,751 -
Total U. S. Department of Housing and Community Development 89,751 - U.S. Department of Homeland Security
Passed through the County of Ventura

97.067 2019-0035 40,684 -
19-SHSGP 4,976 -
45,660 -
Passed through the County of Ventura

97.042 2019-0006 46,604 -
46,604 -
Passed through the California Office of Emergency Services

97.039 HMGP #4407-431-079R 40,324 -
40,324 -
Direct Program
Assistance to Firefighters Grant 97.044 EMW-2019-FG-09826 132,037 117,839 EMW-2019-FG-09714 36,936 -
EMW-2020-FG-13213 162,452 -
FEMA-FY2020 Fire Prevention and Safety (FPS) 97.044 EMW-2020-FF-01126 201,292 - FEMA-FY2020 Staffing for Adequate Fire and Emergency Response 97.044 EMW-2020-FP-00777 141,191 - 673,908 117,839
Passed through the County of Ventura
Assistance to Firefighters Grant FY19 97.044 EMW-2019-FG-10771 24,545 - 24,545 -
698,453 117,839
Total U.S. Department of Homeland Security 831,041 - Hazard Mitigation Grant - Emergency Backup Generator at Oxnard Shores
Homeland Security Grant Program
Emergency Management Performance Grant FY20
See accompanying notes to
Schedule of Expenditures of Federal Aw ards and Independent Auditor's Report on Compliance for Each Ma jor Program; Report on Internal Control over Compliance; and Report on the Schedule of Expenditures of Federal Awards required by the Uniform Guidance.
16 -8-

CITY OF OXNARD
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS (Continued)
FOR THE YEAR ENDED JUNE 30, 2022
Assistance Program Total Total Amount
Federal Grantor/Pass-through Listing Identification Program Provided to Grantor/Program Title Number Number Expenditures Subrecipients U.S. Department of Justice
Direct Program
Equitable Sharing Program 16.922 CA0560400-NCIC 85,188 - 85,188 -
Direct Program
Edward Byrne Justice Assistance Grant (JAG) 16.738 2020-DJ-BX-0781 21,289 21,289 2018-DJ-BX-0852 23,350 -
44,639 21,289
Passed through the County of Ventura Sheriff Department FY21 National Sexual Assault Kit Initiative(SAKI) 16.833 VTA CO SHERIFF-VSCO SAKI 698 - 698 -
Direct Program
COVID-19 FY2020 Coronavirus Emergency Supplemental Funding 16.034 2020-VD-BX-0321 8,778 - 8,778 -
Total U.S. Department of Justice 139,303 21,289
U.S. Department of Transportation
Highway Planning and Construction Cluster
Passed through the State of California Department
of Transportation
C Street Bicycle Facilities 20.205 CML-5129 (087) 59,044 - Northside Vta Blvd. Between Balboa & Rose Avenue 20.205 CML-5129 (078) 1,171 - Traffic Signal Various Locations 20.205 HSIPL 5129 (093) 188 - City Wide Signal Mod 20.205 HSIPL 5129 (095) 22,089 - Total Highway Planning and Construction Cluster 82,492 - Highway Safety Cluster
Passed through the State of California Office of
Traffic Safety
OTS Pedestrian & Bicycle Safety Program-2020 20.600 PS21024 4,353 - OTS Pedestrian & Bicycle Safety Program-2022 20.600 PS22009 13,893 - OTS Traffic Enforcement - 2021 20.600 PT21094 24,366 - OTS Traffic Enforcement - 2020 20.600 PT20098 78,423 - Total Highway Safety Cluster 121,035 -
Passed through the State of California Office of
Traffic Safety
OTS Traffic Enforcement - 2021 20.608 PT21094 68,555 - OTS Traffic Enforcement - 2022 20.608 PT20098 134,875 - 203,430 -
Passed through the State of California Office of
Traffic Safety
OTS Child Passenger Safty - 2020 20.616 OP21013 2,678 - 2,678 -
Total U.S. Department of Transportation 409,635 -
Corporation for National and Community Service
Direct Program
Retired and Senior Volunteer Program FY21-22 94.002 19SRPCA007 65,774 - Retired and Senior Volunteer Program FY20-21 94.002 19SRPCA007 4,450 - Total Corporation for National and Community Service 70,224 - See accompanying notes to
Schedule of Expenditures of Federal Aw ards and Independent Auditor's Report on Compliance for Each Ma jor Program; Report on Internal Control over Compliance; and Report on the Schedule of Expenditures of Federal Awards required by the Uniform Guidance.
17 -9-

CITY OF OXNARD
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS (Continued)
FOR THE YEAR ENDED JUNE 30, 2022
Federal
Assistance Program Total Total Amount
Federal Grantor/Pass-through Listing Identification Program Provided to Grantor/Program Title Number Number Expenditures Subrecipients U.S. Department of Health and Human Services
Aging Cluster
Passed through the County of Ventura Area Agency on Aging Special Programs for the Aging, Senior Nutrition Services 93.045 3500FY22-05 127,334 - Total Aging Cluster 127,334 -
Total U.S. Department of Health and Human Services 127,334 - U.S. Department of Treasury
Direct Program
COVID-19 - Coronavirus State and Local Fiscal Recovery Funds 21.027 N/A 27,007,177 565,000 27,007,177 565,000
Passed through California Water Resources Control Board

21.027 CA5610007-01 1,026,077 -

21.027 CA5610007-01 256,044 -
1,282,121 -
28,289,298 565,000
Total U.S. Department of Treasury 28,289,298 565,000 Total Direct Program 32,529,800 3,872,116
Total Pass Through 2,066,672 -
TOTAL EXPENDITURES OF FEDERAL AWARDS 34,596,472$ -$ COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Water Arrearage Payment Program
COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Wastewater Arrearage Payment Program
See accompanying notes to Schedule of Expenditures of Federal Aw ards and Independent Auditor's Report on Compliance for Each Ma jor Program; Report on Internal Control over Compliance; and Report on the Schedule of Expenditures of Federal Awards required by the Uniform Guidance.
18 -10-

CITY OF OXNARD

NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED JUNE 30, 2022

1. BASIS OF PRESENTATION
The accom
panying schedule of expenditures of Federal awards (Schedule) includes the Fed eral award activit
y of City of Oxnard (City) under programs of the Federal government for the year ended June
30, 2022. The information in this Schedule is presented in accordance with the r equirements of Title
2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance). Because t he Schedule pr
esents only a selected portion of the operations of the City, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the City. It does no t include the
Federal award activity of Oxnard Housing Authority, a blended component unit of the City, which expended $26,175,745 in Federal awards.

2. SUMMA

RY 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.

3. INDIRE

CT COST RATE
The City has not elected to use the 10% de minimis indirect cost rate.

4. FEDERALL

Y-FUNDED LOANS
The City administers loans, primarily forgivable l oans, made from funds provided by the following Federal programs for the year ended June 30, 2022:

LOANS

FEDERAL PROGRAMS OUTSTANDING
Community Development Block Grants
(CFDA #14.218) 3,752,569 $
HOME Investment Partnership Program
(CFDA #14.239) 9,640,632
19 -11-

CITY OF OXNARD

SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2022

SUMMARY OF AUDITOR'S RESULTS
Financial Statements
Type of report the auditor issued on whether the financial statements audited were prepared in accordance with GAAP:

Internal control over financial reporting:
• Material weaknesses identified? Yes x No
• Significant deficiencies identified? Yes x None reported Noncompliance material to financial statements noted: Yes x No Federal Awards
Internal control over major programs:

Material weaknesses identified? Yes x No
Significant deficiences identified? Yes x None reported Type of auditor's report issued on compliance
for major programs:

Any audit findings disclosed that are required to be
reported in accordance with 2 CFR 200.516(a)? Yes x No Identification of major programs:

CFDA No. Name of Federal Program or Cluster

21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Dollar threshold used to distinguish between
type A and type B programs: $1,037,894
Auditee qualified as low-risk auditee? x
Y e s N o
Unmodified
Unmodified
20 -12-

CITY OF OXNARD

SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2022
INDEX

CURRENT YEAR

MAJOR FEDERAL AWARD PROGRAMS
None

FINANCIAL STATEMENTS

PRIOR YEAR

MAJOR FEDERAL AWARD PROGRAMS
Indirect Cost Allocation 2021-001
2021-002
Indirect Cost 2017-005

FINANCIAL STATEMENTS
2020-001
2018-018 - 2018-037
2017-016Information Technology (IT) General Controls
None
CDBG HUD Findings
Information Technology (IT) General Controls
Information Technology (IT) General Controls
21 -13-

CITY OF OXNARD

SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2022
FINDINGS AND QUESTIONED COSTS – MAJOR PROGRAMS
None
FINDINGS AND QUESTIONED COSTS – FINANCIAL STATEMENTS
None
22 -14-

CITY OF OXNARD

SCHEDULE OF PRIOR AUDIT FINDINGS
FOR THE YEAR ENDED JUNE 30, 2022
FINDIN
GS AND QUESTIONED COSTS – MAJOR FEDERAL PROGRAMS
2021-001 – Indirect Cost Allocation (SD)
CFDA Title
and Number: 14.218 - Community Development Block Grants Name of Federal Agency: Department of Housing and Urban Development Internal Control over Compliance: Allowable Cost
Criteria: 2 CFR Part 200.414 requires that governmental entities support indirect costs with a cost allocation plan or an indirect cost proposal prepared in accordance with the Uniform Guidance. 2 CFR Part 200 Appendices III-VII contain the requirements for the development and submission of indirect cost rate proposals and cost allocation plans. A non-Federal entity that has never received a negotiated indirect cost rate, may elect to charge a de minimis rate of 10% of modified total direct costs.

Condition: The City does not have a cost allocation plan or an indirect cost proposal prepared in accordance with the Uniform Guidance. The City has not elected to use the 10% de minimis rate either.

The City charged $22,573 of liability insurance costs to Fund 285 based on a City cost allocation plan.

Cause: The City has not completed the indirect cost study that will comply with requirements of the Uniform Guidance for indirect cost.

Effect or Potential Effect: Indirect costs charged to the CDBG program may not eligible for reimbursement.

Questioned Cost: None, since the amount charged was less than 10% of the total cost.

Repeat of a Prior-Year Finding: 2017-005
Recommendation: The City should complete the central service cost allocation plan (as indicated in the Corrective Action for prior year finding 2017-005). It should include the cost allocation plan for indirect costs, including liability insurance, as required by Uniform Guidance.

City's Response 2022: The City has engaged the services of a consultant and has developed the central service cost allocation plan that includes a cost allocation method for indirect costs, such as liability insurance, in accordance with OMB's Uniform Guidance. The City plans to complete the indirect cost rate no later than April 2023.

Planned Implementation Date: The central service full cost allocation plan is complete and is being implemented with the FY 23-24 budget.

Responsible Person: Jim Costello, Financial Analyst III; Beth Vo, Assistant CFO EP's Comment 2022: In Progress.
(SD – Significant Deficiency)
23 SCHEDULE OF PRIOR AUDIT FINDINGS (Continued)

-15-
2021-002 – CDBG HUD Findings (SD)
CFDA Title and Number: 14.218 - Community Development Block Grants Name of Federal Agency: Department of Housing and Urban Development Internal Control over Compliance: Allowable Cost
Criteria: Re cipients of CDBG grants are required to be in compliance with all requirements imposed by the U.S. Department of Housing and Urban Development at all times.

Condition: The City received fifteen findings and two conc erns from the U.S. Department of Housing and Urban Development as part of the Fiscal Year 2021 Remote Monitoring Report for the Community Development Block Grant (CDBG) Program. HUD conduc ted the remote monitoring in order to assess the City’s performance and compliance with applicable requirements. This report covered grants B-18- MC-06-0534 and B-19-MC-06-0534 for $2,502,719 and $2,516,091, resp ectively.

A finding is a deficiency in program performance bas ed on a violation of a statutory or regulatory requirement. A concern is a deficiency in program performance that is not based on a statutory or regulatory requirement but is brought to the City’s attention.

The following summarizes the findings:
1) Fair Housing Eligibilit
y – The City did not provide sufficient docum entation to support a subrecipient
’s eligibility and national objective.
2) Fire Station Equipment and Vehicles – Fire station generators is an ineligible use of CDBG funds. 3) Citywide Homebuyer Loan Program – The City provided all participants a standard loan of $30,000 instead of limiting the amount of the loan to 50% of the required down payment as specified in CDBG regulations.
4) Conflict of Interest – The City provided a homeowner loan to a City employee and t here was no
evidence th
at the City determined whether a conflict of interest existed. 5) Time and Activity Sheets – The City did not provide documentation associating staff costs charged to specific CDBG program with eligible housing activities carr ied out.
6) Lead-Based Paint – The
City’s rehabilitation program relies solely on a form signed by the City inspector in
dicating that the home was built afte r 1978 to determine when a property requires lead-based
paint inspection, assessment and correction.
7) Procurement Written Policies and Procedures – The City’s purchasing policy manu al did not address if
cost plus a percentage of cost and percentage of construction cost methods of contracting were prohibited.
8) Procuremen
t History – The City’s documentation was not sufficient to detail the procurement history to identify the rationale for the method of procurement, the selection of co ntract type, contract se
lection or reject, or the basis for the cost or price of the contract. 9) Procurement Procedures for Housing Services Programs and Fire Department – The City did not have policies to guarantee that environmental consult
ants are procured for based on
qualificat
ions. There was no evidence provided for the procurement of select fire department equipment and vehicle
s.
(SD – Significant Deficiency)
24 SCHEDULE OF PRIOR AUDIT FINDINGS (Continued)
-16-
10) Financial Standards --
HUD was unable to determine the account codes assigned to specific CDBG activities, CFDA title and grant number within the City’s accounting records. Without these, HUD was unable to identify the source and application of the CDBG award. 11) Source Documentation – Source do
cumentation did not support all expenditure costs of select vouchers reviewed.
12) Record Retention and Access Policy – The City’s record r etention and access policy did not
comply with 2 CFR Part 200 requirements.
13) Protected
Personally Identifiable (PII) Information – The City did not provide writt en documentation to suppo
rt an intern al control self-assessment nor measures to safeguard PII information.
14) Audit Costs
– HUD was unable to determine if measures are in place to ensure HUD awards are charged no
more than a reasonably proportionate share of the audit costs. 15) Equipment Records – T
he City’s equipment records do not comply with all requirements of 2 CFR Part 200.

Cause: The deficiencies
were attributed by HUD to various causes including:
 Not having updated policies and procedures for the CDBG programs  The procure
ment policies and procedures needing to be revised to comply with 2 CFR Part 200  Not having the appropriate accounting codes to keep track of CDBG costs by activit
y/program/grant number
 Not keeping
complete documentation to support costs charged to CDBG.

Effect or Potential Effect: Various
Questioned Cost: None for current year. For prior years: $470,000 for Finding #2; $5,137.16 for Finding #11
Context: The U.S. De partment of Housing and Urban Development conducted a routine monitoring assessment over a selection of CDBG grants administered by the City during program years 2018 and 2019, and determined that the City had fifteen findings which would require corrective actions, and two concerns for which they provided recommended actions.

Repeat of a Prior-Year Finding: No.

Recommendation: We recommen
d that the City continue to follow up with the U.S. Department of Housing and Urban Development in order to sufficiently meet the required corrective action plan.

City's Response 2022: The City believes it has sufficiently co mpleted its Corrective Action Plan detailed in the City's two responses to U.S. Departm ent of Housing and Urban Development (HUD) dated February 8, 2022 and July 1, 2022, respectively, for Fiscal Year 2021 Remote Monitoring and continues to follow up with HUD to receive confirmation that they are in agreement that the Corrective Action Plan was sufficiently completed.

Planned Implementation Date: Co
rrective Action completion dates varied by finding, with all Corrective Actions completed by May 9, 2022.

Responsible Person: Andrea Palmer, Grants Manager
EP's Comment 2022: Completed.
25 SCHEDULE OF PRIOR AUDIT FINDINGS (Continued)

-17-
2017-005 - Indirect Cost (SD)
CFDA Title and Number: 14.218 – Community Development Block Grants Name of Federal Agency: Department of Housing and Urban Development Internal Control over Compliance: Allowable Cost
Criteria: 2 CFR Part 200.414 requires that governmental entities support indirect costs with a cost allocation plan or an indirect cost proposal prepared in accordance with the Uniform Guidance. 2 CFR Part 200 Appendices III-VII contain the requirements for the development and submission of indirect cost rate proposals and cost allocation plans. A non-Federal entity that has never received a negotiated indirect cost rate, may elect to charge a de minimis rate of 10% of modified total direct costs.

Condition: The City does not have
a cost allocation plan or an indirect cost proposal prepared in accordance with the Uniform Guidance. The City has not elected to use the 10% de minimis rate either.

The City charged in fiscal year 2016-2017 $76,912 of indirect costs to Fund 285 based on a City cost allocation plan.

Cause: The Finance Department wa
s not aware of the requirements of the Uniform Guidance for indirect cost, and allocated cost to CDBG and posted the entry without consulting the grants administrator.

Effect or Potential Effect: Any indirect cost s charged to the CDBG program are not eligible for reimbursement.

Questioned Cost: None
Context: The Housing Department discovered th
e error and did not claim reimbursement for the amount.

The amount was not included in the Schedule of Expenditures of Federal Awards.

Repeat of a Prior-Year Finding: 2015-060
Recommendation: The
City should complete the central service cost allocation plan (as indicated in the Corrective Action for prior year finding 2017-005). It should include the cost allocation plan for indirect costs, including liability insurance, as required by Uniform Guidance.

City's Response 2022: The City has engaged th e services of a consultant and has developed the central service cost allocation plan that includes a cost allocation method for indirect costs, such as liability insurance, in accordance with OMB's Uniform Guidance. The City plans to complete the indirect cost rate no later than April 2023.

Planned Implementation Date: The central service full cost allocation plan is complete and is being implemented with the FY 23-24 budget.

Responsible Person: Jim Costello, Financial Analyst III; Beth Vo, Assistant CFO EP's Comment 2022: In progress.
(SD – Significant Deficiency)
26 SCHEDULE OF PRIOR AUDIT FINDINGS (Continued)

-18-
FINDIN

GS AND QUESTIONED COSTS - FINANCIAL STATEMENTS
2020-001 – Information Technology (IT) General Controls (SD) Criteria: IT
general controls (ITGC) are basic controls applied to IT systems. The objectives of ITGC are to ensure the integrity of data and processes that the IT systems support. ITGC have a pervasive effect on the City’s system of internal control over financial reporting.

Condition: We evaluated the design and implementation of ITGCs and noted 12 findings. We communicated such findings to the IT Department. Because those findings reveal vulnerabilities to, or otherwise increase the potential for an attack on, the information technology systems of the City, the details of the findings will not be published in this document. They will, however, be communicated to the City Council via a separate confidential written report.

Repeat of a Prior-Year Finding: 5 out of 12 were repeat findings Recommendation: Our recommendations will be communicated to the City Council via a separate confidential written report.

City’s Response 2022: The City’s corrective action plan will be communicated to the City Council via a separate confidential written report. The auditors will follow up on the City’s implementation of its corrective action plan in the next audit.

EP's Comment 2022: In progress
2018-018 – 2018-037 –Information Technology (IT) General Controls (SD) Criteria: IT general controls (ITGC) are basic controls applied to IT systems. The objectives of ITGC are to ensure the integrity of data and processes that the IT systems support. ITGC have a pervasive effect on the City’s system of internal control over financial reporting.

Condition: We evaluated the design and implementation of ITGCs and noted 20 findings. We communicated such findings to the IT department. Because those findings reveal vulnerabilities to, or otherwise increase the potential for an attack on, information technology systems of the City, the details of the findings will not be published in this document. They will however be communicated to the City Council via a separate confidential written report.

Repeat of a Prior-Year Finding: No
Recommendation: Our recommen
dations will be communicated to the City Council via a separate confidential written report.

City's Response 2022: The City's corrective action plan will be communicated to the City Council via a separate confidential written report. The auditors will follow-up on the City’s implementation of its corrective action plan in the next audit.

EP’s Comment 2022: In progress.
(SD – Significant Deficiency)
27 SCHEDULE OF PRIOR AUDIT FINDINGS (Continued)

-19-
2017-016 - Information Technology General Controls (SD) Criteria: The City should establish and implement comprehensive data security controls to protect sensitive data, mitigate risks to confidentiality, and ensure the integrity and availability of data in the City's information systems.

Condition: We found deficiencies in data security controls. We communicated such findings to the IT department. Because those findings reveal vulnerabilities to, or otherwise increase the potential for an attack on, information technology systems of the City, the details of the findings will not be published in this document. They will however be communicated to the City Council via a separate confidential written report.

Recommendation: Our recommendations will be communicated to the City Council via a separate confidential written report.

City's Response 2022: The City's corrective action plan will be communicated to the City Council via a separate confidential written report. The auditors will follow-up on the City's implementation of its corrective action plan in the next audit.

EP’s Comment 2022: In progress.
(SD – Significant Deficiency)
28 Single Audit Report for
Fiscal Year Ended June 30, 2022
Finance and
Governance Committee
March 28, 2023
29 1 Introduction
2 Schedule of Expenditures of Federal
Awards (SEFA)
3 Major Program
4 Internal Control Findings
AGENDA
Finance and Governance Committee | March 28, 2023
30 Measure O Citizen Oversight Board Meeting | January 27, 2022 Finance and Governance Committee | March 28, 2023
Introduction
•Single Audit Report
• Internal Control Report Required by Government Auditing Standards • Report on Compliance for Each Major Program
• Report on Internal Control on Internal Control over Compliance • Report on the Schedule of Expenditures of Federal Awards 1 31
Measure O Citizen Oversight Board Meeting | January 27, 2022 Finance and Governance Committee | March 28, 2023
Schedule of Expenditures of Federal Awards (SEFA)
• Total Expenditures $34.596M
• Major Programs 1
• Total Programs 19
2 32
Measure O Citizen Oversight Board Meeting | January 27, 2022 Finance and Governance Committee | March 28, 2023
Major Program
Coronavirus
State & Local
Government
Fiscal
Recovery
Fund (CSLFRF
aka ARPA
fund)
3 Program Total Program Expenditures Provided to Subrecipients Direct from US Department of Treasury $ 27,007,177 $ 565,000 Passed through California Water Resources Control Board 1,282,121 - $ 28,289,298 $ 565,000
Eligible Uses
Revenue loss offset $ 21,232,682
Premium pay 1,396,800
Capital outlay 2,406,603
Water arrearage payment program 1,026,077
Wastewater arrearage payment program 256,044
Other 1,971,092
$ $28,289,298
33 Measure O Citizen Oversight Board Meeting | January 27, 2022 Finance and Governance Committee | March 28, 2023
• No internal control findings in FY2022
• Prior year findings
• Federal awards – Resolved
• 2021-001 Indirect Cost Allocation
• 2021-002 CDBG HUD Findings
• 2017-005 Indirect Cost
• Financial Statements – In Progress
• 2020-001Information Technology (IT) General Controls
• 2018-018 – 2018-037 IT General Controls
• 2017-016 IT General Controls
Internal Control Findings 4
34 THANK
YOU!
Eden C. Casareno
[email protected]
909.809.7662
35 FINANCE AND GOVERNANCE COMMITTEE

AGENDA REPORT

REPORTS
AGENDA ITEM NO. D.2

DATE: March 28, 2023

TO: Finance & Governance Committee

FROM: Denise Olson, Interim Chief Financial Officer, (805) 200-5400, [email protected]

SUBJECT: Update on the Corrective Action Plan (CAP) for Closing Past Audit Findings. (10 minutes)

RECOMMENDATION

That the Finance and Governance Committee receive an update on the Corrective Action Plan (CAP) for closing past audit findings and recommend staff forward the presentation to City Council.

Please click the following link to view the required Measure M pre-recorded presentation video: https://youtu.be/2ZomiRAeg50

BACKGROUND

The City’s annual audit for FY 2014-15 produced 111 single-audit findings. These findings primarily concerned the City's policies and procedures (or lack thereof) for accounting and financial management.

Between fiscal year 2016 through the fiscal year ended June 30, 2018, the City’s annual audits continued to identify new findings in the double digits. For FY 2019-20, there was one additional audit finding, for Information Technology General Controls, which was communicated to City Council via a separate confidential written report due to its sensitive nature For FY 2020-21, there was one new finding for accounting and financial management, but only two earlier audit findings remain unresolved, and there were no material weaknesses. For FY 2021-22, there were no new findings for accounting and financial management; only two prior findings remain unresolved. FY 2021-22 is the third year in a row where the City had no material weaknesses. Below is a table summarizing audit finding history.

History of Findings by Fiscal Year A
# of
New
Finding
B
# of Repeat Findings
C = (A+B) + Prior Year C
Total # of Findings
FY 2014-15 111 0 111
FY 2015-16 5 0 116
FY 2016-17 10 9 135
FY 2017-18 24 13 172
FY 2018-19 8 3 183
36 FY 2019-20 1 0 184
FY 2020-21 1 1 186
FY 2021-22 0 0 186

In order to correct the various accounting and financial management audit findings, the City was required to produce a Corrective Action Plan, or CAP. This plan, updated annually, addresses all unresolved findings, and the steps and timeline to correct them. Staff created a detailed audit scorecard, and began presenting it to the Finance & Governance Committee, and to City Council, every six months.

DISCUSSION

During our FY 21-22 Single Audit, Eadie + Payne determined that City sufficiently completed the corrective action plan for the finding identified in the FY 20-21 audit related to the CDBG HUD findings. Only two findings remain outstanding; the findings related to (1) the Indirect Cost Allocation Plan Update and (2) the Information Technology General Controls.

We have continued to make progress on the corrective actions for both findings. For the Indirect Cost Allocation Plan finding, the City has developed the central cost allocation plan that includes a cost allocation method for indirect costs. The City plans to complete the indirect cost rate this spring. The City Council will continue to receive updates on the IT General Controls findings through separate confidential reports.

STRATEGIC PRIORITIES

This agenda item supports the Organizational Effectiveness strategy. The purpose of the Organizational Effectiveness strategy is to reinforce, stabilize, improve, and strengthen the organizational foundation of the City in order to build a modern, high-functioning City government that effectively and efficiently supports the operating departments in providing high-quality services and programs for our residents and businesses.

FINANCIAL IMPACT

There is no financial impact.

Prepared by: Jennifer Hiraoka, Senior Manager Internal Controls, Denise Olson, Interim Chief Financial Officer

ATTACHMENTS

1. Presentation on Corrective Action Plan

37 UPDATE ON THE CORRECTIVE

ACTION PLAN FOR CLOSING PAST

AUDIT FINDINGS
Presentation to Finance and Governance Committee
Denise Olson, Interim Chief Financial Officer
Jennifer Hiraoka, Senior Manager Internal Controls
March 28, 2023
38 RECOMMENDATION 2
That Finance & Governance Committee receive the update on the Corrective Action Plan (CAP) for closing past audit findings and recommend staff forward the presentation to City Council. 39 AGENDA 3
• Status of Corrective Action Plan
• Continued progress
40 CAP STATUS DEFINITIONS 4
Complete – Auditors have tested and determined that corrective action for the finding has been effectively implemented To Be Tested – Policies and Procedures (P&P) approved (if applicable), training completed and corrective action ready for auditors to test during the next single audit
P&P Draft – P&P drafted but not yet approved by CFO and/or training not yet provided.

In Progress – Staff has taken steps towards implementation, but not yet drafted P&P or completed training
Not Started – Staff has not initiated mitigations, implemented resolutions or provided training
Passed/No Longer Required – Staff disagrees with the finding and/or auditors have determined corrective action is no longer required 41 CORRECTIVE ACTION PLAN STATUS THROUGH OCTOBER 2022
5 FINDINGS STATUS (2015-2021)
(as of October '22)

MATERIAL

WEAKNESS

SIGNIFICANT

DEFICIENCY
Non-
Compliance
Best
Practice TOTAL
TOTAL Findings 72 78 17 19 186
Repeat Findings (7) (12) (4) (4) (27)
TOTAL Unique Findings 65 66 13 15 159
COMPLETE 63 60 7 12 142
Passed / No Longer Required 2 3 6 3 14
TO BE TESTED 0 0 0 0 0
P&P DRAFT 0 0 0 0 0
IN PROGRESS 0 3 0 0 3
NOT STARTED 0 0 0 0 0
TOTAL Unresolved Findings 0 3 0 0 3
42 ONE AUDIT FINDING CLEARED DURING FY 21-22 SINGLE AUDIT 6 • During our FY 21-22 Single Audit, Eadie + Payne determined that City sufficiently completed the corrective action plan for the finding identified in the FY 20-21 audit related to the CDBG HUD findings. • Only two (2) outstanding findings remain “In Progress” and were not ready “To Be Tested” during Eadie+Payne’s Single Audit in January 2023.
43 FY 2022 SINGLE AUDIT RESULTED IN NO ADDITIONAL FINDINGS, 2 PREVIOUS FINDINGS REMAIN UNRESOLVED – NO MATERIAL WEAKNESSES (3 years in a row!) 7 There were no new audit findings during FY 2021-22
FINDINGS STATUS (2015-2022)
(as of February '23)

MATERIAL

WEAKNESS

SIGNIFICANT

DEFICIENCY
Non-
Compliance
Best
Practice TOTAL
TOTAL Findings 72 78 17 19 186
Repeat Findings (7) (12) (4) (4) (27)
TOTAL Unique Findings 65 66 13 15 159
COMPLETE 63 61 7 12 143
Passed / No Longer Required 2 3 6 3 14
TO BE TESTED 0 0 0 0 0
P&P DRAFT 0 0 0 0 0
IN PROGRESS 0 2 0 0 2
NOT STARTED 0 0 0 0 0
TOTAL Unresolved Findings 0 2 0 0 2
44 REMAINING AUDIT FINDINGS
The two (2) outstanding remaining findings:

Prior Audit Findings:
 Update to Indirect Cost Allocation Plan [Finance Department] – will complete the indirect cost rate this spring and remain on track to implement new cost allocation plan with FY23-24 budget  Information Technology (IT) General Controls [IT Department] – City Council continues to receive updates via separate confidential reports
8 45
35 39
87 23
22 5
4 8
8 57
21 20
11 53
10 4
16 5
5 5
5 3
1 0
0 0
0 2
1 1
0 0 0
0 0
0 0
0 3
2 60 70 80 90 100

MATERIAL WEAKNESS

SIGNIFICANT DEFICIENCY
Non-Compliance
Best Practice
TOTAL
COUNT OF UNRESOLVED* FINDINGS 2015-2023
CAP STATUS - As of Mar'19
CAP STATUS - As of Oct'19
CAP STATUS - As of Mar'20
CAP STATUS - As of Oct'20
CAP STATUS - As of Mar'21
CAP STATUS - As of Oct'21
CAP STATUS - As of Apr'22
CAP STATUS - As of Feb'23
HISTORY OF PROGRESS 9
0 10 20 30 40 50
*Includes all unique findings excluding “Complete” or “Passed/No Longer Required” status 46 o We continue to operate with a commitment to following policies and procedures. Recent financial statement audit resulted in no new findings, showing that prior corrective actions have been effective.
o We continue to make progress on our remaining open audit findings, we completed a Cost Allocation plan and will
complete the indirect cost rate this spring.
o We continue to ensure our Accounting team is properly trained. The team received training on Generally Accepted Accounting Principles (GAAP) updates in preparation for the FY 22-23 financial reporting cycle.
o The City continues to implement stronger internal controls, which were a critical component of Oxnard’s 5th S&P credit rating upgrade dated October 2022, to ensure we maintain our existing credit rating.

PROGRESS CONTINUES 10
47 Questions?
11 48

FINANCE AND GOVERNANCE COMMITTEE

AGENDA REPORT

REPORTS
AGENDA ITEM NO. D.3

DATE: March 28, 2023

TO: Finance & Governance Committee

FROM: Helen Miller, Chief Information Officer, (805)385-7446, [email protected]

SUBJECT: Purchase of Microsoft Software and Licensing. (10 minutes)

RECOMMENDATION

That the Finance and Governance Committee recommend that City Council approve and the Mayor execute an agreement and purchase order with an authorized Microsoft licensing service provider (reseller), "piggybacking" off of County of Riverside Microsoft Enterprise Agreement #8084445, for an amount not-to- exceed $2,028,260 for the continued use and purchase of Microsoft products for the three year agreement term of May 1, 2023, to April 30, 2026.

Please click the following link to view the required Measure M pre-recorded presentation video: https://youtu.be/j3J2uNeZZIA

BACKGROUND

Since 2011, the City of Oxnard has used a Microsoft Enterprise Agreement (EA) for the Microsoft software licenses, software maintenance, cloud services, and professional services used by the Police and Fire Departments. Microsoft software is on every Police Department and Fire station computer and on most of their technology infrastructure servers, providing the systems used to conduct day-to-day operations and deliver services to residents. The current EA, which expires on April 30, 2023, provides licensing for 515 computer workstation Windows operating systems, desktop productivity software suites (e.g., Microsoft Word, Excel, PowerPoint, Visio), and the licensing for database and server infrastructure used for public safety operations; e.g., electronic content management, time-keeping, records management, computer aided dispatch, remote IT support, reporting writing.

The City "piggybacks" off of the County of Riverside’s competitively bid Microsoft Enterprise Master Purchase Agreement, which is used by more than 900 public entities. This agreement provides the City with greater savings than if we were to negotiate with Microsoft on our own. The agreement enables the City of Oxnard to: (1) lock in pricing for the length of a three-year term, (2) amortize the cost of new licenses and support across multiple years, (3) access all necessary Microsoft software available for purchase, (4) raise and lower flexible commitments on hosted services, and (5) obtain additional licenses to meet the City’s operational and strategic technology needs for the next three years.

Under the EA’s Software Assurance Benefits, the City will continually receive software patches, security updates, and any upgrades to the latest versions of Microsoft products during the term of the three-year agreement. The EA provides the most efficient and cost-effective approach to maintaining these software licenses with a single annual payment. Each year, the City must ‘true-up’ our EA year end total payment to 49 account for all the Microsoft product changes required throughout the previous twelve month period to sustain and support City departments’ existing and evolving operations. For example, this new EA includes a rolled over 24% licensing growth rate for public safety’s usage of Microsoft device licensing when compared with their licensing needs at the beginning of the current EA agreement that expires on April 30, 2023. The increase is attributed to the larger number of network connected computer devices (+100) required by public safety from April 2020 through May 2023.

DISCUSSION

For more than twenty years, the City has used Microsoft as the platform throughout the organization, including Windows desktop and server operating systems, business applications such as Office suite (Word, Excel, PowerPoint) and Structured Query Language (SQL) Server, which is used to store and manage data for the City. This purchase will rectify the number of valid licenses for Windows desktop based on the City’s current staffing levels and computer systems in use. The addition of Microsoft Systems Center for datacenter management will allow the City's Information Technology (IT) Department to upgrade and maintain the City’s 240 virtual servers, used to run the City departments’ business software applications, so that they are on the latest operating system, updates and security patches. Datacenter management will provide the City with necessary control of its IT environment and platforms by simplifying the deployment, configuration, management and monitoring of infrastructure while increasing agility and performance. The addition of SQL Service licensing will allow IT to properly segment database resources to adequately support data usage, security, and demand based on the City’s software solutions. As some of the City’s enterprise and department solutions no longer support older SQL Server databases, this will provide the ability to upgrade to the latest versions in order to properly support these systems and maintain necessary updates and security patches.

Therefore, in addition to renewing the EA for public safety’s continued use of Microsoft products over the next three years, this renewal expands the EA to be citywide so all City departments have up-to-date and supported Microsoft products. The majority of non-public safety department Microsoft licenses are old, which presents material risk to City operations and the continuity of resident service delivery. Purchasing and deploying enterprise-wide Microsoft licenses for the entire City enhances the City’s cyber resilience.

The new EA includes the continuation of public safety’s 515 device licenses and other products currently in use, plus adds an additional 325 new device licenses in EA year 1, another 644 device licenses throughout EA years 2 and 3, and adds SQL and Microsoft Systems Center licensing and professional services. The three-year not to exceed total cost of $2,028,260 includes a 20% contingency (due to 24% growth this past year). Annual amounts and timing/volume of product purchases are estimated and are subject to shift within the three-year EA term while adhering to the three-year not-to exceed total. Microsoft product cost estimates in the table below are subject to change as actual quote(s) are contingent upon Microsoft’s timeline for issuing EA renewal quotes to resellers within Microsoft’s prescribed EA renewal process window. IT anticipates receipt of reseller quotes within the next two week period for inclusion in the April 2023 City Council agenda item for this purchase. The actual agreement and PO will come after Council approval, as is customary for Microsoft agreements.

Over this new EA’s three-year term, the City’s current device count total, 1,484, will be transitioned from 35% licensed to 100% licensed. These will be perpetual licenses owned by the City, ensuring that upkeep of these devices as well as for Microsoft servers, operating systems, databases, network management systems and other network components are sustained for City departments’ current and future needs. A 20% cost contingency is included to account for anticipated growth, unforeseen remediation or emergency, and the flexibility to meet the City’s Microsoft needs through April 31, 2026, when this new EA will terminate.

The table below shows the estimated cost to the City each year for the proposed new EA:

Description Estimated Year 1 Estimated Year 2 Estimated Year 3 Total 50 EA for Public
Safety users (515
devices)
$95,806 $95,806 $95,806 $287,418
EA for City users
(325 devices)
$294,899 $0 $0 $294,899
EA for City users
(644 devices)
starting in Year 2
$0 $292,177 $292,177 $584,354
EA for servers,
databases, remote
services, cloud, prof
svcs
$41,182 $41,182 $41,182 $123,546
EA for
infrastructure/
datacenter (1500
endpoints)
$200,000 $100,000 $100,000 $400,000
Contingency (20%
over a 3 year term)
$126,377 $105,833 $105,833 $338,043
TOTAL (per fiscal
year)
$758,264 $634,998 $634,998 $2,028,260 - Not to
Exceed 3yr total

STRATEGIC PRIORITIES

This agenda item supports the Organizational Effectiveness strategy. The purpose of the Organizational Effectiveness strategy is to reinforce, stabilize, improve, and strengthen the organizational foundation of the City in order to build a modern, high-functioning City government that effectively and efficiently supports the operating departments in providing high-quality services and programs for our residents and businesses.

FINANCIAL IMPACT

This purchase increases the City’s three-year estimated renewal cost for Microsoft products, inclusive of a 20% growth contingency, from $493,157 for the Police and Fire Departments only, to $2,028,260 for all City departments and the addition of IT datacenter management capabilities. This is an increase of $1,535,104 (76%) for the three-year agreement term, averaging $511,701 annually.

Funds for this expenditure are included in the IT department’s FY 22-23 budget for Year 1. Future years’ payment obligations will be allocated into the IT budget as part of the normal annual budgeting process.

Prepared by: Helen Miller, Chief Information Officer, Gary Krumian, Programmer Analyst

ATTACHMENTS

1. Microsoft EA Riverside Cnty LSP Reseller Agreements Oct2019

2. Presentation - Microsoft Agreement

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Purchase of Microsoft Software and
Licensing
Finance & Governance Committee
March 28, 2023
Helen Miller, Chief Information Officer
377
That the Finance and Governance Committee recommend that City Council approve and the Mayor execute an agreement and purchase order with an authorized Microsoft licensing service provider (reseller), "piggybacking" off of County of Riverside Microsoft Enterprise Agreement #8084445, for an amount not- to-exceed $2,028,260 for the continued use and purchase of Microsoft products for the three year agreement term of May 1, 2023, to April 30, 2026
RECOMMENDATION 2
378
• Since 2011, the City of Oxnard has used a Microsoft Enterprise Agreement (EA) for Microsoft products used by the Police & Fire Departments • Microsoft software is on every public safety computer and on most of their technology infrastructure servers providing business systems used to conduct daily business and deliver services to residents. • County of Riverside negotiated a Microsoft Enterprise Agreement #8084445 o The City piggybacks on their contract as do 900 other public agencies to achieve greater savings
o Required Microsoft agreement term is 3 years
o Prices locked in for duration
o Must use a Riverside Master Agreement authorized reseller BACKGROUND 3
379
• The City’s existing EA terminates on April 30, 2023
• Maintaining the EA ensures the City can keep department systems operational and resident services available via:
o Valid compliant Microsoft licensing
o Weekly Microsoft security maintenance & product bug fixes o Enhanced functionality service pack updates
o Rights to the latest version of a product
o Microsoft technical support access
o Single IT administrative portal
o Improved efficiency, effectiveness, reliability, cyber resiliency, and performance of City operations dependent on Microsoft products BACKGROUND 4
380
• City has used Microsoft as platform throughout City for 20 years; e.g. o Operating systems – servers and work stations
o Business applications – Office suite; SQL server (store/manage data) o Obsolete products remain in use
DISCUSSION 5
381
IT continues to improve the City’s technology infrastructure, computer hardware & business applications (software) including ensuring valid licenses for all computer software utilized by City staff and Departments • Existing EA covers only public safety
• This purchase adds all other City Departments & datacenter management
• All Departments require up-to-date & supported Microsoft products for functionality and cyber-security
• Rectifies number of valid licenses for Windows desktop based on City’s current staffing levels & computer systems use
DISCUSSION 6
382
NEEDS AND DETAILS – Estimated Costs 7
TABLE 1 – Microsoft EA Estimated Costs, 5/1/2023 through 4/30/2026 • County of Riverside authorized reseller quote process is in progress; agreement to come after Council approval
• Agreement total not to exceed estimate = $2,028,260
• Growth contingency (20%) is for unforeseen remediation or emergency needs and flexible capacity to support City Departments through April 30, 2026 when the EA agreement terminates • Public safety’s actual EA growth rate for past 3 years is 24% • Total EA contingency amount in above table is $338,403 • Annual amounts and the timing /volume of product purchases are subject to shift within EA’s term, based on City Departments’ needs, with adherence to not-to-exceed 3-year agreement total.

Description EA Year 1
5/1/23 -4/30/24
EA Year 2
5/1/24-4/30/25
EA Year 3
5/1/25-4/30/26
Total
Microsoft Enterprise Agreement (EA) - Public
Safety + 20% growth contingency
$ 164,386 $ 164,386 $ 164,386 $ 493,157
Microsoft Enterprise Agreement – All Depts &
Datacenter + 20% growth contingency
$ 593,879 $ 470,612 $ 470,612 $ 1,535,104
TOTAL, estimated per fiscal year $ 758,264 $ 634,998 $ 634,998 $ 2,028,260 383
• This purchase increases the City’s three-year estimated renewal cost for Microsoft products, inclusive of a 20% growth contingency o From $493,157 for the Police & Fire Departments
o T o $2,028,260 for all City departments & the addition of IT datacenter management capabilities.
o Increase of $1,535,104 for the 3-year agreement term, averages $511,701 annually.
• Funds available in IT’s FY 22-23 budget for EA year 1 • Future years’ payment obligations will be allocated into IT budget as part of normal budgeting process.

FINANCIAL IMPACT 8
384
That the Finance and Governance Committee recommend that City Council approve and the Mayor execute an agreement and purchase order with an authorized Microsoft licensing service provider (reseller), "piggybacking" off of County of Riverside Microsoft Enterprise Agreement #8084445, for an amount not- to-exceed $2,028,260 for the continued use and purchase of Microsoft products for the three year agreement term of May 1, 2023, to April 30, 2026
RECOMMENDATION 9
385

QUESTIONS
10 386