Victorville City Council
June 20, 2023

Change Order
Community Buildings
Christianbelle Electric Inc.
11580 I Avenue
Hesperia, CA 92345
Phone: (760) 948-3444
Website: www.christianbelle.com
Pony wall with receptacles not installed per Connect Homes Drawings Exterior fixtures not provided
Lighting fixtures and wiring missing
Low Voltage Lighting Control wire and devices missing
Fixture lenses missing from various fixtures
BUILDING 11
Panel cans, interiors, and covers not on site
Conduit and wiring from Main Panel to subpanels not installed per Connect Homes Drawings Conduit and wiring to large condensing unit not installed per Connect Homes Drawings Overhead branch wiring to panels not installed as done in some of the other buildings Receptacles not wired to a common junction box on underside per Connect Homes Drawings Receptacles missing or not installed
Lighting and Lighting Controls not wired to a common junction box per Connect Homes Drawings (Please provide lighting control drawings)
Exterior fixtures not provided
Lighting fixtures and wiring missing
Low Voltage Lighting Control wire and devices missing
Fixture lenses missing from various fixtures
We reserve the right to correct this quote for errors and or omissions. All wiring to meet the requirements of the 2020 National Electrical Code.

Pricing:

For the Sum of $350,000.00
The Change Order expires on 05/31/23
We request an additional 20 days be added to the completion date of the project.

Sincerely,
David Placencia
Christianbelle Electric Inc.

Item Number: 15
City Council / Board of Directors
Written Communications
Meeting of: June 20, 2023
Submitted By:

Joe Slegers, Building Official

Subject:

Green Tree Library – Conceptual Design
Recommendation:

That the Honorable City Council approve the conceptual site and floor plans for the Green Tree Library and direct staff to move forward with the construction drawings for the final design.

Fiscal Impact:

There is no fiscal impact associated with this action. A contract with TR Design Group, Inc. (TR Design) in the amount of $896,014,98 was previously approved by the Council at its February 7, 2023, meeting, inclusive of the cost for creation of construction drawings.

Strategic Plan Goal:

The City of Victorville Strategic Plan 2020-2023 identifies multi-year strategic goals and various strategies to work toward achieving those goals. Goal E, Invest in Infrastructure, focuses on creating a healthy and livable community by maintaining the city’s assets through investment in infrastructure and innovations. Specific to this project, Strategy 3 focuses on completing the Library Master Plan and developing implementation strategies to improve and enhance Library services in the community. Council adopted the Library Master Plan on April 20, 2021, and staff have been working to implement recommendations therein.

Background:

Through the Master Plan process, it was determined that the current library facility has inadequate space to serve the City’s current population. The current library facility has a footprint of 8,229 sq. ft. The city needs approximately 14,990 sq. ft. to serve the current population.
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In May 2021, space became available at the Green Tree Golf Course Clubhouse (Clubhouse), prompting staff to investigate the potential for Library’s relocation. The Clubhouse location was consistent with certain Master Plan recommendations in that it is centrally located, has natural lighting desired for library facilities, and has an improved outdoor area for programming and use by library patrons. Due to its more recent construction date, the site also provides a higher level of code compliance including enhanced levels of ADA accessibility for visiting patrons. Because of these findings, staff elected to proceed and seek the services of an architectural design firm to redesign the Clubhouse into the City Library.

On March 15, 2022, the Council unanimously awarded TR Design a contract to conceptualize the Clubhouse as a space that will accommodate both library services and golf operations (Phase A). TR Design then made numerous site visits to the existing library and the new Green Tree location to take 3D photographs, observe existing programs, and interview staff. Utilizing the data from their research, TR Design created a first rendering of a conceptual design of the Library at Green Tree. The first rendering was circulated to key staff and stakeholders to review and provide input. Staff met to discuss their thoughts and findings, and those were forwarded to TR Design. This process continued for two more cycles before TR Design ultimately completed a final conceptual design of the Library at GreenTree utilizing the existing building footprint.

The next step in the design process would have been for TR Design to proceed with Phase B following Council approval. Phase B included $383,639.98 to generate Architectural, Civil, Structural, Landscape, Mechanical, Plumbing, and Electrical construction drawings. It also included preparing bid-ready plans and documents to assist with advertising the bid for construction, obtaining permits, construction administration, post-construction services, and project management. Staff were prepared to request approval from the Council to continue the design into Phase B when we were informed of the Building Forward Library Infrastructure grant award in October 2022, which provided $9,035,105 to complete the construction and expand the footprint of the Library at Green Tree.

At the February 7, 2023, Council approved the revision to TR Design’s contract for an updated conceptual plan (Phase A), construction drawings and construction management (Phase B).

Discussion:

As part of the Phase A contract, a revised conceptual plan was designed to include approximately 5,000 additional sq.ft. for the library facility (Attachment A). The proposed conceptual plan will allow the City to surpass the current level of library services and provides flexibility for future changes to meet patron needs. For example, movable stacks and furniture allow for staff to move items as needed. Additional restrooms and workspace allow staff to have room for cataloging and inventorying. Patrons will have additional square footage in the children’s area, adult section, and teen section. The design also accommodates a maker space, meeting rooms and ample storage. 3 1
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The golf area has also been remodeled to include a food and beverage area with a drive- up window, as well as a pass-through walkway to the library so patrons have access to snacks and beverages. The plan was reviewed with the Friends of the Library, a local non-profit that assists with and donates to the City Library, where additional feedback was provided. The plan was then scheduled for review at the next Community Services Advisory Committee (CSAC) meeting.

On May 15, CSAC reviewed the conceptual layout, discussed operations and logistics for golf and library services, and ultimately recommended moving the site and floor plans forward to the City Council for consideration.

If the Council moves forward with the staff recommendation, TR Design will begin the final construction document phase of the project. After completion of the construction documents, staff will begin the advertising and procurement process, with future construction contracts being brought to the Council for consideration.

This project is currently on schedule, with the Building Forward Library Infrastructure grant expenditure deadline being March 31, 2026. Additionally, the preliminary construction estimate for the contemplated design is within the project budget (funded by a combination of the Building Forward Library Infrastructure grant and Measure P).

Staff are available for any questions the Council may have.

Attachments: Attachment A – Library Final Design

ATTACHMENT A

Item Number: 16
City Council / Board of Directors
Written Communications
Meeting of: June 20, 2023
Submitted By:

Sophie Smith, Deputy City Manager / City Treasurer

Subject:

Macerich Assistance Payment #9 - Mall of Victor Valley Development Agreement Recommendation:

That Your Honorable City Council authorize assistance payment as provided for in the Development Agreement with Macerich Victor Valley LLC in the amount of $408,960.00 for Calendar Year (CY) 2022.

Fiscal Impact:

This item has a fiscal impact of $408,960.00 out of the General Fund. There are sufficient funds in the FY 2022-2023 budget for this expense in the account below:

Account Description Available Budget
1000010-52300-97029 General Fund Contract Services - Macerich $408,960.00 Strategic Plan Goal:

This payment aligns with Goal C, Strategy 8 in the City of Victorville Strategic Plan 2020- 2023 by working in partnership with the Mall of Victor Valley by assisting in meeting performance measures to attract new businesses.

Background:

At the City Council meeting of July 17, 2012, the City Council adopted Ordinance 2291 approving a Development Agreement with Macerich Victor Valley LLC, owners of the Mall of Victor Valley (the Mall). The Development Agreement was approved resulting from Council’s recognition that the Mall has experienced declining gross sales since 2007 which directly correlated with a reduction in sales tax generated to the City and available to fund its essential public services, including police and fire. The analysis at that time had shown that gross sales at the Mall have reduced from $175 million in 2006 to $106 million in 2010.
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Pursuant to the Development Agreement, the Mall is permitted to receive the tier one maximum amount until the $18.89 million threshold is reached. Upon approving the subject Development Agreement, the City required, as a condition to its assistance, that the Mall would perform redevelopment that would reposition the Mall to becoming a destination for the diverse shopping demographics of the valley and keeping it fresh and attractive for future tenants of the Mall. Among the required performance measures, the Mall was required, pursuant to Article 5 of the Development Agreement to: 1. Successfully relocate into expanded space and cause for the public opening of a reformatted JC Penney; 2. Successfully cause for the opening of a new Macy’s as a fashion retail anchor;

3. Complete the remodel of all exterior entry ways; and 4. Sign leases for up to 25,000 square feet of space (that was the former JC Penney anchor pad) with planned occupancy within 9 months from the date of the signed lease.

To assist in off-setting certain costs to achieve the aforementioned performance measures, once those performance measures were achieved, the City agreed to provide assistance payments in annual amounts equal to the sales tax received by the City that is in excess of a baseline to be retained by the City of $1 million. The agreement allows an aggregate collection of up to $18,886,644.00 in payment assistance or for a period of 28 years, whichever occurs first. If the maximum of $18,886,644.00 is not reached by the end of the 28 years, the City of Victorville has reached the conclusion of the assistance agreement and no additional payments will be made. The performance measures were satisfied by the Mall in calendar year 2013, therefore, 2013 became the measurement year where City assistance was to be commenced. Notably, the Mall added Dick’s Sporting Goods to satisfy performance measure #4 and has exceeded the space requirement of the Development Agreement.

Discussion:

City staff employs HDL Companies to conduct sales tax analysis for all tenants at the Mall, including its anchor tenants. In the aggregate, that analysis is represented with the following:

Calendar Year 2023
Sales Tax Generated at Mall of Victor Valley $1,412,960 Sales Tax Threshold ($1,000,000)
Assistance Payments Due (Gross) $412,960
Ex C-10 Contract Maintenance Fee ($ 2,000)
Ex C-11 Sales Tax Analysis Fee ($ 2,000)
Due to Mall of Victor Valley $408,960
Attachment A shows the charts provided for in the original agreement which reflects a predicted erosion of Sales Tax as well as Sales Tax Increment Sharing proposal by Macerich Victor Valley LLC. Attachment B shows actual sales tax payments since the start of this development agreement. If approved, this payment will bring the total payments to $2,900,205 of the $18.8 million threshold.
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Calendar year 2020 shows no payment as with the issued stay at home orders resulting in the shutdown of the mall for a large portion of the year, the sales tax generated at the mall did not exceed the threshold deduction. During calendar year 2021 there was a surprising turn around in spending, which resulted in much larger than previous generation of sales tax and an increased payment to Macerich. Calendar year 2022 generated a slight decline compared to 2021, however, 2022 still exhibited higher than predicted sales tax returns.

Staff remains available for any questions Council may have.

Attachments: A. Macerich Development Agreement 2012 Charts B. Payments Distributed to Macerich to Date

ATTACHMENT A
Macerich Development
Agreement 2012 Charts

ATTACHMENT A
The chart below was then presented and summarized the trend line of gross sales at the Mall and the projected downward trend had the City Council chose to not assist. For comparison purposes, had the City chosen not to assist in the redevelopment of the Mall, the Mall was projected in 2014 to realize $88.28 million in gross sales which would have yielded an estimated $882,800 in City sales tax revenue.

Er
osion of Sales Tax
The char
t provided below was then used to help illustrate, based on Macerich projections, what the sales tax sharing could look like over the next 20 years, though pursuant to the Development Agreement, the Mall is permitted to receive the tier one maximum amount until the $18.89 million threshold is reached.

Sal
es Tax Increment Sharing
$0
$20,000,000
$40,000,000
$60,000,000
$80,000,000
$100,000,000
$120,000,000
$140,000,000
$160,000,000
$180,000,000
$200,000,000
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
Actual Sales
Projected Sales
Linear (Projected Sales)
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
Tier One Maximum Amount
Base Sales Tax Revenues
$50.72 million
$88.28 million
$175 million
Projections
total
$18,886,644
over term of
agreement

ATTACHMENT B
Payments distributed to
Macerich to date

ATTACHMENT B

The chart below reflects the distribution of Sales Tax to Macerich since the inception of the Sales Tax Agreement in 2013. There is a steady gain in activity from 2013 until 2016.

This has been followed by several years of decline which have been primarily a loss of sales to online retailers. Total amount paid through 202 1 is $ 2,491,245 and with the approval of council for this payment, the total through 202 2 would be $2,900,205 of the maximum $18.89 million threshold with 18 years remaining in this agreement. Next year is predicted to be lower than 2021 based on current information received to date.

143,159
257,697
320,746
381,979
331,092
310,556 279,157
0 466,859
408,960
$-
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
$350,000
$400,000
$450,000
$500,000
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Sales Tax Distributed to Macerich

Item Number: ����

City Council / Board of Directors

Written Communications

Meeting of: June 20, 2023

Submitted By:

Sophie Smith, Deputy City Manager / City Treasurer

Subject:

Fiscal Year 2023/2024 Contracts/Renewals - Annual Supply and Service Agreements

Recommendation:

That the City Council/Board of Directors award contracts for the Annual Supply and Service Agreements to various vendors and suppliers for Fiscal Year 2023/2024 per the Adopted Budget approved on June 06, 2023.

Fiscal Impact:

The following departments have included their annual costs in their department budgets:
 City Manager
 Fire
 VMUS
 SCLA
 Economic Development/Successor
Agency
 Finance
 Information Technology

 Community Services
 Engineering
 Public Works
 Water
 Building
 Code Compliance
 Planning

Each of these departments have budgeted their respective contracts in the June 06, 2023, Adopted Budget. The various funding sources are listed in the tables in the Discussion section. Annual Supply Agreements tota l $3,393,435.00 and t he Annual Service Agreements total $13,232,843.70.

Strategic Plan Goal:

These annual supply and service agreements align with Goal A: Financial Sustainability – foster fiscal health through disciplined l ong-term planning, cost control, increased revenues, and cost recovery. Locking in our vendors and suppliers on multi-year annual contracts ensures pricing stability and continued service levels. Goal C: Support the economic vitality and preservation of the comm unity for all its mem bers. Stable pricing 3 1
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on supplies and services allows various departments the resources to initiate development projects throughout the city. Goal E: Invest in Infrastructure. Various vendors are key components to the design of infrastructure and innovation throughout the city.

Discussion:

Various departments throughout the year work with Purchasing staff to determine frequently requested/needed supplies and services. Purchasing staff determines if these supplies or services warrant a multi-year contract to avoid market price fluctuations and establish a preferred purchasing method to protect the City from these fluctuations by increasing financial stability and predictability in terms of prices, charges, and service quality. One of the advantages of multi-year contracts include reduction in administrative and maintenance costs by creating fixed annual pricing for repetitive commodity purchases, thus reducing the need for multiple instances of bidding, soliciting quotes, purchase orders, and other administrative costs while stabilizing prices over a period of five years. In addition, annual maintenance contracts provide the City with a form of assurance knowing repairs will be provided efficiently and economically. The City is guaranteed the supplier will keep a full stock of original spare parts, have qualified personnel readily available for preventative maintenance and emergency calls, standby equipment, and offer substantial discounts. The City can better predict its spending through annual contracts and develop spending trends to seek ways to improve savings, thereby providing continuous improvement of its processes over the long term.

Each of the competitively bid and/or sole source contracts from the following supply and service providers allow for an additional one-year contract renewal option based on performance. Purchasing staff worked with appropriate City and District staff to inquire a desire to exercise the renewal option available for these agreements for an additional option year, based on satisfactory performance, those department approvals are attached for your reference. The listed supply and service providers have expressed an interest in exercising said options for Fiscal Year 2023/2024, and a majority have agreed to honor the contract pricing with the inclusion of State regulations involving the Department of Industrial Relations (DIR) prevailing wage requirements SB854 and AB219.

In regard to one of our service contracts, High Desert Homeless Services’ contract renewal for their Interim Shelter operations includes a reduced scope of services and a month-to-month term. High Desert Homeless Services continuance of services as the shelter operator at the Interim Shelter is required until such time operations transition to the Wellness Center. Transition of the clients from the Interim Shelter to the Wellness Center, which includes the closure of the Interim Shelter, is anticipated to occur within the next six months.

Below is a list of supply and service agreements staff is seeking for approval. 3 1
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Annual Supply Provider Agreements
VENDOR TYPE OF SERVICE DEPT FY 2023/2024 FUNDING SOURCE All Star Fire
Equipment
Fire Prevention
Equipment &
Supplies
FIRE $485,000.00 Fire Equipment
Expense
LN Curtis Fire Prevention
Equipment &
Supplies
FIRE $250,000.00 Fire Equipment
Expense
Flyers Energy Fuel PW $200,000.00
Gen Fund Bulk
Fuel Inventory
Southern Counties Fuel PW $250,000.00
Gen Fund Bulk
Fuel Inventory
Merrimac Energy Fuel PW $200,000.00
Gen Fund Bulk
Fuel Inventory
Beck Oil Fuel
PW
WATER
SCLA
FIRE
$750,000.00
$250,000.00
$119,605.00
$190,000.00
Gen Fund Bulk
Fuel Inventory;
Water Production,
Admin & Field;
Airport
Operations;
General Fund-Fire
Imperial Sprinkler Irrigation Supplies PW
PARKS
$100,000.00
$100,000.00
PW-

LMAD/DFAD/MAD
Gas Tax, LTF,
Storm
Drain, Sewer,
PW-Parks General
Fund
Robertson’s Concrete Products PW
SCLA
$135,080.00
$ 25,000.00
PW-Gas Tax,
LTF, Measure I,
Sewer, Storm
Drain; SCLA-
Airport
Operations
Vulcan Materials Hot Mix Asphalt
PW
WD
SCLA
$120,750.00
$ 30,000.00
$ 50,000.00
PW-Gas Tax,
General Fund,
Water, Sewer;
VWD -Field
Infrastructure
Repairs;
SCLA-Airport
Operations
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Waxie Janitorial Supplies

PW-PARKS
BUILDING-FAC.

FIRE
SCLA
$40,000.00
$58,000.00
$25,000.00
$15,000.00
General Fund -
Parks
General Fund-
Fac.

General Fund –
Fire
Airport
Operations
Total Annual Supply Provider Agreement Amount $3,393,435.00 Annual Service Provider Agreements
VENDOR TYPE OF SERVICE DEPT FY 2023/2024 FUNDING
SOURCE
Dell
Microsoft EA &
Subscriptions
Renewal; Dell
Server, Compellent
San & APC Support
and Battery Refresh;
VMware Renewal;
Tape Library, SQL
Licenses
IT $310,500.00 General Fund
NTT America
(formally
Dimension Data)
Cisco Smartnet,
Managed Services,
Meraki, Lic. & Webex
Sub.

IT $250,000.00 General Fund
Logicalis
Veeam Backup,
Cisco AMP for
Endpoints, Cisco
Umbrella & Security
Licensing
IT $200,000.00 General Fund
Tyler Technologies
Munis, TCM,
Energov Software
AND Tyler Direct
Renewal and
Support
IT $896,423.00
General Fund
Water
Solid Waste &
Dev. Tech
Robert Half
International
Consultative & Talen
Acquisition Services IT $218,000.00 General Fund
OpenGov
Financial
Transparency
Software
IT $150,000.00 General Fund
Alltech Industries,
Inc.

Security Guard
Services

FINANCE

COMMUNITY

SERVICES
$109,893.36
$102,490.00
General Fund
Water/Solid
Waste
Clifton/Larson/Allen
LLP
Professional Auditing
Services FINANCE $144,953.00
General Fund,
Water, Airport
Operations

HDL Sales and Use Tax
Measure P FINANCE $150,000.00
$50,000.00
General Fund;
Measure P
Astrum Utility
Services
Consultant –
Municipal Utility
Operations
VMUS $193,200.00
Foxborough-
Electric/ VMUS
Utility
Operations
IEC Corporation Qualified Electrical
Engineers VMUS $200,000.00
Foxborough-
Electric/ VMUS
Utility
Operations
4Leaf Building and Fire
Inspection

BUILDING
FIRE $436,500.00
Building Fire
Contract
Services

High Desert
Homeless Services
Interim Homeless
Shelter Lead
Operator at the
Westwinds Sports
Center located at
18241 George Blvd.

Planning $830,000.00 Measure P
Harris & Associates
Housing Successor
Agency/RFP Review

Annual ROPS & Tax
Increment

Bond Continuing/
Disclosure Reports

General Plan &
Housing Element
Annual Progress
Report

Old Town Community
Revitalization (CRIA)
EDD

City Manager

City Mgr/(EDD)

Planning

Planning
$5,000.00

$70,000.00

$57,000.00

$33,395.00

$10,000.00

CHAS,Contract
Service

City Manager-
SCLA

CDR/HDPT; BV

CDR & SA
Contract
Services

General Fund

State Grant-
Development

AGA Engineers, Inc. Traffic Signal Design ENG $160,000.00 Measure I HR Green On-Call Plan & Map
Checking ENG $150,000.00 General Fund,
On-Call
Water Systems
Consulting
On-Call Engineering
Services ENG $250,000.00 Water
Operations
Woodard & Curran
SCLA Wastewater
Treatment Plan
Misc. Eng. Services
ENG $497,200.00
$160,000.00
Wastewater
Treatment
Plant
Fireworks & Stage
FX America
4th of July Annual
Fireworks Show

COMMUNITY
SERVICES $206,000.00 General Fund-
Fireworks
American
Landscape Landscape Maint. PW $844,495.00 DFAD, LMAD,
MAD
T.R. Stewart-Roto- Qualified Sewer PW $300,000.00 Sewer

Rooter Lateral Repairs
VJL Waste dba
Alpha Omega
Qualified Sewer
Lateral Repairs PW $225,000.00
Sewer

West Coast Arborist Tree Trimming PW
PARKS
$84,475.00
$50,000.00

PW- LTF,
Sewer, LMAD,

DFAD, MAD,
PW-Parks
General Fund
Burns & McDonnell
Building Support,
Construction
Management &
Inspection Services &
ALP Update
SCLA $902,243.34
$594,996.00 FAA Grants
Ferguson Enterprise
Automated Meter
Reading System and
Water Meters
WD $870,000.00
Water
Operations
Meter Service
Change Outs
InfoSend Utility Billing Mailing WD - (FINANCE)
PW- (FINANCE) $177,200.00
VWD-Water
Operations/
PW-Sanitation
Clinical Labs Lab Serv ices WD $150,000.00 Water
Operations
Eurofins Lab Servic es WD $150,000.00 Water
Operations
General Pump Well Maintenance WD $771,000.00 Water
Production
Layne Christensen Well Ma intenance WD $771,000.00 Water Production

Univar
Water Treatment
Chemicals WD $317,000.00 Water HDPP
Mojave Water
Agency
Administrative &
Biological
Assessment
WD $175,280.00
Water
Production/Gro
und Water
Mojave Water
Agency
Recover (R3) Water
Deliveries WD $821,600.00
Water
Production/Pur
chased Water
Konica Minolta Copier Least & Ma int. Various Dept. $188,000.00 Various Funds

Total Annual Service Agreement Amount $13,232,843.70

Staff from Finance, City Manager, SCLA, VMUS , Code Compliance, Building, Planning, Fire, Engineering, Public Works, Inform ation Technology, Econo mic Development and Water departments have reviewed the agr eement options and recommend contracts/ renewals for Fiscal Year 2023/2024. The contract/renewal costs of these contracts were included in the overall budget for Fisca l Year 2023/2024, adopt ed on June 06, 2023.

There are no additional appropriations requested.

Staff remains available to answer any questions the Council may have.

Attachments:

A. Department Head Approvals

Item Number: 18
City Council / Board of Directors
Written Communications
Meeting of June 20, 2023
Submitted By:

Sophie Smith, Deputy City Manager / City Treasurer

Subject:

Receive and File of Annual Single Audit on Federal Expenditures Report for Year Ended June 30, 2022.

Recommendation:

That the City Council receive and file the Fiscal Year 2021-2022 Single Audit.

Fiscal Impact:

There is no fiscal impact from this receive and file item.

Background:

Governmental organizations or nonprofits with federal expenditures in excess of $750,000 are required by law to have a single audit performed. This audit includes both the annual financial statements and the federal awards. The single audit reviews the management of the grants and ensures that rules are followed in association with the grant or award. These rules are listed in Title 2 US Code of Federal Regulations (CFR) Part 200.

The purpose of the single audit is to test the City’s internal controls and compliance and to report any findings to those charged with governance. The City in turn, initiates a corrective action plan to correct identified deficiencies and produce recommended improvements. Thus, the audit results turn into opportunities to strengthen our internal controls and operate efficiently, and eventually, they become best practices in our business processes.

StrategicPlanGoal:Annual single audit and reporting is part of Goal A: Financial Sustainability as this report acts as a tool for management to monitor Federal program activities. 3 1
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Discussion:

In most years, the single audit report is included in the same council agenda item with the annual comprehensive financial statements and Southern California Logistics Airport Authority and Victorville Water District annual audit reports. This year, the single audit was performed after those reports were filed as the auditing firm of CliftonLarsonAllen LLP (CLA) audited four major programs per the 2 CFR 200 requirements. This included major Coronavirus Relief Funds including American Rescue Plan Act (ARPA) and CDBG- CV funding sources. The deadline to submit the Single Audit for fiscal year ending June 30, 2022 was March 31, 2023.

There was a delay in filing resulting from the amount of grants that required testing this fiscal year primarily as a result of the additional funding that the City received through Federal Coronavirus Funding and the extensive testing requirements provided to the auditors through the annual supplement to the OMB Uniform Guidance. The expenditures for this period along with the results of the audit are reflected in this report which was filed with the Federal Audit Clearinghouse on May 31, 2023 and sent to all federal agencies granting funding to the City of Victorville.

Audit findings 2022-001 through 2022-003 were submitted to the City Council at the April 18, 2023, meeting on item 8 titled “Annual Financial Reports for the Fiscal Year Ended June 30, 2022”. These findings were previously discussed during the receipt and filing of the annual comprehensive audited financial statements and the SCLAA and VWD annual audit reports and provided to the City Council. Auditing standards require that these findings be repeated in the Single Audit as part of the City’s Corrective Action Plan.

Findings 2022-004 through 2022-008 deal specifically with the handling of Federal grant funds and management and staff have outlined a corrective action for these items. The corrective action is delineated below in attachment B labeled “Corrective Action Plan”. 2022-04 Significant Deficiency in Internal Control over Compliance Allowable Cost 2 CFR Part 200, section 200.303 of the Uniform states that a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. The City has specific CDBG grant personnel that are responsible for reviewing all grant expenditures to ensure they are allowable. However, the designated grant personnel are reviewing the expenditures after the disbursement has been made instead of prior to authorizing the disbursement and charging to the grant. In addition, there is no formal documentation retained to illustrate that all disbursements were reviewed. Internal controls over federal awards should include authorization by appropriate grant personnel prior to such disbursements occurring.
2022-005 Significant Deficiency in Internal Control over Compliance Allowable Cost Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, §200.430 requires payroll records to support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one federal 3 1
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award; a federal award and nonfederal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. From July 2021 through September 2021, personal services charged were recorded for two employees based on budget to the program and an after-the-fact determination of personal services charged to the program was not conducted and adjustments, if necessary, were not recorded. In addition, the City corrected this matter beginning October 2021 and this finding did not apply from October 2021 through June 2022. In addition, in some cases, overtime charges occurred that were not supported by timesheets. 2022-006 Significant Deficiency in Internal Control over Compliance Allowable Costs
Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, §200.430 requires payroll charges to be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated.

After the findings the City received in the prior year audit, the City revised the internal controls over payroll to require a supervisor's review and approval of hours charged to federal awards on the electronic timesheets, which is in line with the requirements of the Uniform Guidance. In 2 out of 12 payroll transactions tested, there was no supervisor approval of hours charged to the federal award, which was a lack of internal controls. 2022-007 Significant Deficiency in Internal Control over Compliance Reporting Prime recipients awarded a federal grant greater than or equal to $30,000 are subject to FFATA sub-award reporting requirements as outlined in the Office of Management and Budgets guidance issued August 13, 2020. The City is a prime recipient and provided subawards totaling $135,000 to three recipients, each over the $30,000 reporting threshold. Two out of the three FFATA reports were filed for these recipients. Also, the two FFATA reports that were filed occurred in the month of August 2022 for the obligation date of July 1, 2021, which is not the end of the month following the month in which the sub-grant was awarded.
2022-008 Significant Deficiency in Internal Control over Compliance (Suspension and Debarment)
2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of suspension and debarment. The City was not able to provide supporting documentation that the verification of suspension or debarment was performed prior to entering into the contract.

Deficiencies 22-005, 22-006, and 22-007 are repeated findings from the FYE 2021 single audit. Although corrective measures were taken after that single audit was completed, there were some early months in the 21-22 fiscal year where the issues were being addressed; however, there was some slight carryover into the 21-22 fiscal year.

Deficiencies 22-004 and 22-008 are new findings. As mentioned in the corrective action plan, Executive Management is initiating an internal auditor function to help identify the causes of these findings and take appropriate action to eliminate future occurrences. It is anticipated the internal auditing firm will begin its work in late June or early July. 3 1
6 3
Staff remain available for any questions the City Council may have.

Attachments: A. Single Audit of Federally Assisted Grant Programs for Year Ended June 30, 2022
B. Corrective Action Plan

ATTACHMENT A

SINGLE AUDIT OF FEDERALLY ASSISTED GRANT
PROGRAMS YEAR ENDED JUNE 30, 2022
CIT

Y OF VICTORVILLE

VICTORVILLE, CALIFORNIA

SINGLE AUDIT OF FEDERALLY ASSISTED

GRANT PROGRAMS
YEAR ENDED JUNE 30, 2022

CITY OF VICTORVILLE

TABLE OF CONTENTS
YEAR ENDED JUNE 30, 2022

INDEPENDENT AUDITORS’ REPORT ON INTERNAL CONTROL OVER

FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS

BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN
ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS 1
INDEPENDENT AUDITORS’ REPORT ON COMPLIANCE FOR EACH MAJOR

FEDERAL PROGRAM, REPORT ON INTERNAL CONTROL OVER

COMPLIANCE, AND REPORT ON THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS REQUIRED BY THE UNIFORM GUIDANCE 3
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 7
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 8
SCHEDULE OF FINDINGS AND QUESTIONED COSTS 9
SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS 25

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INDEPENDENT AUDITORS’ REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

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

STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

Honorable Mayor and Members of City Council
City of Victorville
Victorville, California
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Victorville (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 of Victorville’s basic financial statements, and have issued our report thereon dated April 11, 2023.

Report on 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) as a basis for designing 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.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified. We identified certain deficiencies in internal control, described in the accompanying schedule of findings and responses as items 2022-001 through 2022-003 that we consider to be material weaknesses.

Honorable Mayor and Members of City Council
City of Victorville
(2)
Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City of Victorville’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 financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

City’s Response to Findings
Government Auditing Standards requires the auditor to perform limited procedures on the City’s response to the findings identified in our audit and described in the accompanying schedule of findings and responses. The City’s response was not subjected to the other auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on the response.

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.

CliftonLarsonAllen LLP
Irvine, California
April 11, 2023

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INDEPENDENT AUDITORS’ REPORT ON COMPLIANCE FOR EACH MAJOR

FEDERAL PROGRAM, REPORT ON INTERNAL CONTROL OVER COMPLIANCE, AND

REPORT ON THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

REQUIRED BY THE UNIFORM GUIDANCE

Honorable Mayor and Members of City Council
City of Victorville
Victorville, California

Report on Compliance for Each Major Federal Program
We have audited the City of Victorville’s (the City) compliance with the types of compliance requirements described 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 auditors’ results section of the accompanying schedule of findings and questioned costs.

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 conducted 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; 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 Auditors’ Responsibilities for the Audit of Compliance section of our report.

We are required 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.

Honorable Mayor and Members of City Council
City of Victorville
(4)
Auditors’ 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 examining, on a test basis, evidence regarding the City’s compliance with the compliance requirements referred to above and performing such other procedures as we considered necessary in the circumstances.

 Obtain an understanding 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 effectiv eness 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.

Other Matters
The results of our auditing procedures disclosed instances of noncompliance, which are required to be reported in accordance with the Uniform Guidance and which are described in the accompanying schedule of findings and questioned costs as items 2022-004 through 2022-008. Our opinion on each major federal program is not modified with respect to these matters.

Government Auditing Standards requires the auditor to perform limited procedures on the City’s response to the noncompliance findings identified in our compliance audit described in the accompanying schedule of findings and questioned costs. The City’s response was not subjected to the other auditing procedures applied in the audit of compliance and, accordingly, we express no opinion on the response.

Honorable Mayor and Members of City Council
City of Victorville
(5)
Report on Internal Control Over Compliance
Our consideration of internal control over compliance was for the limited purpose described in the Auditors’ 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 and therefore, material weaknesses or significant deficiencies may exist that were not identified. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, as discussed below, we did identify certain deficiencies in internal control over compliance that we consider to be significant deficiencies.

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. We consider the deficiencies in internal control over compliance described in the accompanying schedule of findings and questioned costs as items 2022- 004 through 2022-008, to be significant deficiencies.

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.

Government Auditing Standards requires the auditor to perform limited procedures on the City’s response to the internal control over compliance findings identified in our audit described in the accompanying schedule of findings and questioned costs. The City’s response was not subjected to the other auditing procedures applied in the audit of compliance and, accordingly, we express no opinion on the response.

The purpose of this report on internal control over co mpliance 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 Required by the Uniform Guidance We have audited the financial statements of the governmental 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 have issued our report thereon, dated April 11, 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.

Honorable Mayor and Members of City Council
City of Victorville
(6)
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 responsibi lity of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements.

The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, includi ng 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.

CliftonLarsonAllen LLP
Irvine, California
May 24, 2023

CITY OF VICTORVILLE

SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
JUNE 30, 2022

(7)

Federal Pass-Through
Assistance Entity Passed-
Federal Grantor / Pass-Through Grantor / Listing Identifying Federal Through to Program / Cluster Title / Project Number Number Expenditures Subrecipients United States Department of Housing and Urban Development Direct Assistance:

CDBG Entitlement Grants Cluster:

Community Development Block Grants 14.218 n/a 1,674,691 $ 467,655 $ (CDBG)
COVID-19 CDBG 14.218 n/a 446,317 -
Total CDBG Entitlement Grants Cluster 2,121,008 467,655 HOME Investment Partnerships Program 14.239 n/a 314,361 - Total United States Department of Housing and Urban Development 2,435,369 467,655 United States Department of Justice
Passed-through the County of San Bernardino:

Edward Byrne Memorial Justice Assistance
Grant Program 16.738 2017-DJ-BX-0991 8,918 - Total United States Department of Justice 8,918 - United States Department of Transportation
Direct Assistance:

Airport Improvement Program 20.106 n/a 940,527 - COVID-19 Airport Improvement Program 20.106 n/a 94,327 - Total Airport Improvement Program 1,034,854 -
Passed-through California Department of Transportation:

Highway Planning and Construction Cluster:

DEMO5UBL-
Highway Planning and Construction 20.205 5380(028) 12,697,538 - Highway Planning and Construction 20.205 BHLS-5380(026) 2,409,041 Highway Planning and Construction 20.205 ATPL-5380(032) 359,311 - Total Highway Planning and Construction Cluster 15,465,890 - Total United States Department of Transportation 16,500,744 - United States Department of Treasury
Passed-through the County of San Bernardino:

CARES21-
COVID-19 Coronavirus Relief Fund 21.019 PRJC-VIC 2,139 - Direct Assistance:

COVID-19 Coronavirus State and Local
Fiscal Recovery Funds 21.027 n/a 1,796,796 -
Total United States Department of Treasury 1,798,935 - United States Department of Homeland Security
Passed-through the County of San Bernardino:

Emergency Management Performance Grants 97.042 n/a 21,449 - Total United States Department of Homeland Security 21,449 - 20,765,415$ 467,655 $ TOTAL EXPENDITURES OF FEDERAL AWARDS

CITY OF VICTORVILLE

NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
JUNE 30, 2022

(8)

NOTE 1 BASIS OF PRESENTATION
The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal award activity of the City of Victorville (the City) under programs of the federal government as well as federal financial as sistance passed through other government agencies for the year ended June 30, 2022. The information in this Schedule is presented in accordance with the 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). Because the Schedule presents only a selected portion of the operations of the City, it is not intended to and does not present the financial statements of the City. The City’s reporting entity is defined in Note 1 of the notes to the City’s financial statements.

NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Expenditures reported on the Schedule are reported on the modified accrual basis of accounting for governmental funds and the accrual basis for proprietary funds, which is described in Note 1 of the notes to the City’s financial statements. Such expenditures are recognized following the cost principles contained in the Uniform Guidance for all awards with the exception of Assistance Listing 21.019 and 21.027, which follows criteria determined by the Department of Treasury for allo wability of costs. Under these principles, certain types of expenditures are not allowable or are limited as to reimbursement.

NOTE 3 INDIRECT COST RATE
The City has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance.

CITY OF VICTORVILLE

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

(9)

Section I – Summary of Auditors’ Results

Financial Statements

1. Type of auditors’ report issued: Unmodified

2. Internal control over financial reporting:
 Material weaknesses identified? x yes no  Significant deficiencies identified? yes x none reported

3. Noncompliance material to financial
statements noted? yes x no

Federal Awards

1. Internal control over major federal programs:

 Material weakness(es) identified? yes x no

 Significant deficiency(ies) identified? x yes none reported

2. Type of auditors’ report issued on
compliance for major federal programs: Unmodified

3. Any audit findings disclosed that are
required to be reported in accordance
with 2 CFR 200.516(a)? x yes no

Identification of Major Federal Programs

Assistance Listing Numbers Name of Federal Program or Cluster

14.218 Community Development Block Grants Cluster

20.106 Airport Improvement Program

20.205 Highway Planning and Construction Cluster

21.027 COVID-19 Coronavirus State and Local Fiscal
Recovery Funds

Dollar threshold used to distinguish between
Type A and Type B programs: $ 750,000

Auditee qualified as low-risk auditee? yes x no

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

(10)

Section II – Financial Statement Findings

2022-001

 Material Weakness in Internal Control over Financial Reporting

Condition: Amounts recorded in the general ledger for the pension deferred outflows and inflows of resources and pension expense and amounts allocated to governmental activities, business-type activities, and enterprise funds for these amounts did not agree individually or in total to the City’s calculated pension amounts.

Criteria or Specific Requirement: The pension deferred outflows and inflows of resources and pension expense should be recorded in the general ledger at amounts that agree to the CalPERS provided amounts for the miscellaneous defined benefit pension plan and to the calculated amounts utilizing the CalPERS tool for the safety cost-sharing defined benefit pension plan. The amounts allocated to City funds should follow the City’s historical policy for allocating such amounts, which is based on the current year CalPERS contributions by fund.

Effect: The pension deferred outflows and inflows of resources and pension expense were materially misstated, which resulted in an overall decrease to pension expense of approximately $2.4 million, increase to deferred outflows of $19.8 million and increase to deferred inflows of $17.5 million.

Cause: The City made errors when generating the journal entry to record the pension deferred outflows and inflows of resources and pension expense.

Repeat Finding: This finding is a repeat of a finding in the immediately prior year.

Recommendation: We recommend the City implement policies and procedures to ensure the accurate recording of pension amounts in all funds.

Views of Responsible Officials and Planned Corrective Actions: With the additional staff added in FY21/22, there was insufficient training which took place and resulted in reconciliation errors in City amounts versus auditors’ amounts. After meeting with the auditors to review the reconciliation steps and ending balances, it was determined a step was incorrectly omitted which caused the reconciliation to the incorrect table in the actuarial valuation and the City has since corrected the reconciliation processes. Implementation of a three-tier review process is now in place and additional staff will be properly trained in FY22/23 as part of our cross-training procedures.

As part of the FY 23-24 budgeting process, the City’s Executive Management Team will be requesting the addition of an Internal Auditor position to the Table of Organization to help to identify potential audit issues on an ongoing basis, prior to the external auditing process.

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

(11)

Section II – Financial Statement Findings

2022-002

 Material Weakness in Internal Control over Financial Reporting

Condition: During our review of capital assets, we noted (1) construction in progress projects that were complete or had been cancelled and required reclassification to other capital asset categories or expensing; (2) recording missing capital asset additions; (3) removal of a project included in construction in progress for which the goods had not yet been received that required reclassification to prepaid expenditures. In addition, the City had restatements to beginning equity to record capital asset additions to prior years. The capital asset restatements also resulted in a restatement to recognize the SCLAA’s liability due to tenants for rental credits owed from tenant capital improvements made and contributed to SCLAA.

Criteria or Specific Requirement: When capital projects are complete and meet the City’s capitalization policy, these projects should be moved to the appropriate asset category, such as infrastructure, and depreciated over the life of the asset. Projects that do not meet the City’s capitalization policy should not be recorded as construction in progress and should be expensed as incurred. When projects are cancelled and the asset is no longer usable, the project should be expensed. In addition, all expenses/expenditures that meet the City’s capitalization policy should be capitalized. When goods have not yet been received, the City should record a prepaid asset instead of a capital asset. Capital assets contributed from t enants should be recognized as capital contributions and a capital asset addition in the year the assets are contributed. Any corresponding liability due to tenants from donating these capital improvements should be recognized as the liability is incurred.

Effect: Audit adjustments had a net impact to decrease capital assets $4.5 million, decreasing expenses/expenditures $2.7 million and increase prepaid items $4.2 million. The restatement increased capital assets $8.2 million, recorded accumulated depreciation of $201 thousand, and recognized a $756 thousand liability for rental credits from tenant capital improvements made and contributed to the SCLAA.

Cause: The City did not sufficiently follow the year-end closing procedures to identify the above errors.

In addition, the SCLAA did not review lease agreements for capital improvement and rental credit terms to consider the impact on the general ledger.

Repeat Finding: This particular finding was not noted in the immediately prior year; however, findings related to audit adjustments for capital assets were noted in the immediately prior year.

Recommendation: We recommend the City implement policie s and procedures to review capital assets at year-end for appropriate classification and review leases for capi tal improvement and rental credit terms.

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

(12)

Section II – Financial Statement Findings

2022-002 (Continued)

Views of Responsible Officials and Planned Corrective Actions:
(1) City personnel reconciling capital assets will review with departments at minimum twice a year as well as reviewing budget to actual for projects and notices of completion in city council agenda items to catch all completed projects. Additionally, staff will question departments regarding all projects residing in the Construction in Progress coding with no activity for at least four months to ensure that project is still continuing forward or if it needs to move to “Idle Assets” to be completed in the future or expensed if project has been discontinued and/or did not result in an asset.

(2) In performing reconciliation of the assets curr ently in the Construction in Progress (CIP) account as part of the review process, staff discovered an asset which had been completed in FY2020- 21 but was still recorded as “CIP”. Staff immediately capitalized the item and brought this to the attention of the supervisor who contacted auditors to make them aware.

(3) With the implementation of GASB87, staff did not have procedures already in place to capture portions of a lease which had rental credits for tenant improvements to be completed. Staff has now incorporated this as part of the review of all new leases so any future lease agreements with embedded rental credits or other tenant improvement lease payment reductions are recognized as capital improvements when appropriate. Additionally, staff will discuss new leases with departments to ensure that any non-lease revenue is properly recorded.

As part of the FY 23-24 budgeting process, the City’s Executive Management Team will be requesting the addition of an Internal Auditor position to the Table of Organization to help to identify potential audit issues on an ongoing basis, prior to the external auditing process.

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

(13)

Section II – Financial Statement Findings

2022-003

 Material Weakness in Internal Control over Financial Reporting

Condition: The City has various projects that are grant funded on a reimbursement basis, which means that the City incurs the cost and then requests for reimbursement from the funding source.

During our audit, we reviewed these projects and had numerous inquiries when grant receivables did not equal the unreimbursed eligible expenditures. This led to numerous adjustments to correct the balances.

In addition, the Victorville Water District (District) received federal funds under the American Rescue Plan Act (ARPA) that were utilized for payment of past due utility bills resulting from the pandemic. The City recorded these amounts in a governmental fund instead of the District’s enterprise fund that received the benefit.

Criteria or Specific Requirement: Grant receivables should be equal to the eligible project expenditures less any amounts previously reimbursed by the grantor. For governmental funds, deferred inflows of resources, unavailable revenues, should be recorded instead of revenue when those amounts are received after the City’s availability period, which is 60 days. In addition, in the cases when revenues must be returned if not utilized, cash received should be offset by unearned revenue.

Grant revenues and expenses should be recorded in the fund that received the benefit.

Effect: Approximate changes in the general ledger balances due to the adjustments are as follows: net decrease in receivables of $13.4 million, net decrease in deferred inflows of resources, unavailable revenues, and unearned revenues of $12.5 million, and a net decrease in revenues of $803 thousand.

In addition, the City had a restatement of $591 thousand to record unearned revenue for amounts collected that must be returned to ratepayers if not utilized. This also resulted in an audit adjustment of $635 thousand to record revenues and expenses in the District and remove these revenues and expenditures from the City’s governmental special revenue fund.

Cause: The City did not perform an analysis on each project to verify the balances in these accounts prior to commencement of the audit procedures. The City recorded the cash received in the District’s enterprise fund; however, all revenues and expenditures/expenses were recorded in a City governmental special revenue fund.

Repeat Finding: This finding is a repeat of a finding in the immediately prior year.

Recommendation: We recommend the City implement policies and procedures to review all project activity and verify the amounts recorded for grants receivable and deferred inflows of resources, unavailable revenues, are accurate prior to the commencement of the audit. In addition, we recommend the District implement policies and procedures to ensure all grant revenues and expenditures are recorded in the fund that received the benefit.

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

(14)

Section II – Financial Statement Findings

2022-003 (Continued)

Views of Responsible Officials and Planned Corrective Actions: The city has procedures set up to review and ensure that each project and org is reconciled at the end of the year. Unfortunately, due to the large amount of grants, there were some that had activity posted to them after personnel had reconciled and these did not get reviewed again prior to audit. Staff is working on a schedule and posting access to ensure unauthorized or unreviewed entries are not allowed to back date into the prior fiscal year while staff works on reconciliation for audit.

Additionally, with the new American Rescue Plan Act (ARPA) revenue received in Fiscal Year 2021 and 2022, the city implemented a utility assistance pl an to help those who fell behind on their residential water and sanitation payments as a result of COVID-19. Staff did not realize that this needed to be recorded in the appropriate enterprise accounts as revenue from other governments instead of treating it like a governmental grant for that program. Since all other ARPA programs to date are government related, this issue should not come up again. Staff has made note of this in the grant reconciliation procedures for any future grants as part of the audit review.

As part of the FY 23-24 budgeting process, the City’s Executive Management Team will be requesting the addition of an Internal Auditor position to the Table of Organization to help to identify potential audit issues on an ongoing basis, prior to the external auditing process.

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

(15)

Section III – Findings and Questioned Costs – Major Federal Programs

2022-004

Federal Agency: United States Department of Housing and Urban Development

Federal Program Name: CDBG Entitlement Grants Cl uster: Community Development Block Grant (CDBG)

Assistance Listing Number: 14.218

Federal Award Identification Number and Year: B-21-MC-06-0593; B-20-MC-06-0593; B-19-MC-06- 0593; B-18-MC-06-0593; B-17-MC-06-0593; B-16-MC-06-0593; Award Years 2021, 2020, 2019, 2018, 2017, and 2016

Award Period: Fiscal Year 2021-2022

Type of Finding:
 Significant Deficiency in Internal Control over Compliance (Allowable Costs)  Other Matter (Allowable Costs)

Criteria or Specific Requirement: 2 CFR Part 200, section 200.303 of the Uniform states that a non- federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award.

Condition: The City has specific CDBG grant personnel that are responsible for reviewing all grant expenditures to ensure they are allowable. However, the designated grant personnel are reviewing the expenditures after the disbursement has been made instead of prior to authorizing the disbursement and charging to the grant. In addition, there is no formal documentation retained to illustrate that all disbursements were reviewed. Internal controls ov er federal awards should include authorization by appropriate grant personnel prior to such disbursements occurring.

Questioned Costs: None noted.

Context: All disbursements are reviewed in the same manner.

Cause: The City will correct any unallowed expenditures identified by grant personnel by moving such expenditures to an appropriate fund and revenue source. These procedures were deemed by the City to be adequate.

Effect: Without formal documentation of the review process, the review might not occur without management's knowledge. In addition, internal controls should have a preventative as well as detective aspect to ensure timely identification of any unallowable costs or activities.

Repeat Finding: This is not a repeat finding.

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

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Section III – Findings and Questioned Costs – Major Federal Programs

2022-004 (Continued)

Recommendation: We recommend that the City either utilize the electronic authorization capabilities of the accounting system or manually initial or sign invoices to have approvals of all grants expenditures by the designated grant personnel prior to disbursing the funds.

Views of Responsible Officials: The City maintains internal controls to review all CDBG expenditures.

These controls vary based upon expenditure type (e.g. administration, City Department subrecipients, and non-City subrecipients); however, all of these expenditure types are reviewed prior to disbursement. These controls are summarized as follows:

 Administration – Expenditures such as hours worked by City Staff, procurement of office supplies used to supplement the CDBG program, and other administrative costs are tracked through the City’s accounting system. These measures currently include the review/approval by managers/supervisors of City staff hours worked and the projects/activities completed, and review/approval of Purchase Requisitions and Purchase Orders by City staff through the City’s accounting system, all of which occur prior to disbursement. Purchase Requisitions and Purchase Orders also include a contract and an invoice or project description that lets appropriate City staff determine the eligibility of the proposed disbursement and the associated account being charged.
 City Department Subrecipients – Expenditures for City Department Subrecipients are not made until review has been completed and the associated Purchase Requisitions and Purchase Orders is approved by appropriate City staff. Purchase Requisitions and Purchase Orders also include an invoice or project description that lets appropriate City staff determine the eligibility of the proposed disbursement and the associated account being charged. Applicable projects are also tracked through the City’s process to solicit bids/proposals, with the scope of work reviewed during all phases of the project to ensure grant eligibility.  Non-City Subrecipients – Subrecipients from outside the organization are subject to a thorough reimbursement protocol that includes the following:
o Checklist - Provided to all grantees outlini ng requirements for submitting reimbursement requests, with example/fillable exhibits to outline eligible expenditures. These exhibits require the submittal of supplemental evidence (e.g. receipts, cancelled check/bank statements, time sheets, description of services provided, client eligibility, etc.). Paper records of these items are maintained.
o Reviews - All reimbursement requests ar e reviewed/verified by two separate City departmental grant staff, with signatures confirming the eligibility of the request. Paper records of these items are maintained.
o Purchase Orders - Invoices are included in all submittals to the City’s accounting system. All purchase orders are reviewed/approved by City staff via accounting system.

In addition to maintaining paper records, moving forward all Purchase Orders and submitted invoices for non-City subrecipients will include copies of the approved/signed exhibits further confirming staff review of such items. All other Purchase Orders will include invoices that include a signed or initialed acknowledgement by appropriate City staff to suppl ement reviews/approval performed via the City’s accounting system.

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

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Section III – Findings and Questioned Costs – Major Federal Programs

2022-005

Federal Agency: United States Department of Housing and Urban Development

Federal Program Name: CDBG Entitlement Grants Cl uster: Community Development Block Grant (CDBG)

Assistance Listing Number: 14.218

Federal Award Identification Number and Year: B-21-MC-06-0593; B-20-MC-06-0593; B-19-MC-06- 0593; B-18-MC-06-0593; B-17-MC-06-0593; B-16-MC-06-0593; Award Years 2021, 2020, 2019, 2018, 2017, and 2016

Award Period: Fiscal Year 2021-2022

Type of Finding:
 Significant Deficiency in Internal Control over Compliance (Allowable Costs)  Other Matter (Allowable Costs)

Criteria or Specific Requirement: Allowable Costs: Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, §200.430 allows for budget estimates for personal services to be used for interim accounting purposes provided, among other criteria, that “The nonfederal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a federal awards based on budget estimates. All necessary adjustments must be made such that the final amount charged to the federal award is accurate, allowable, and properly allocated.”

Allowable Costs: Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, §200.430 requires payroll records to support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and nonfederal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.

Condition: From July 2021 through September 2021, personal services charged were recorded for two employees based on budget to the program and an after-the-fact determination of personal services charged to the program was not conducted and adjustments, if necessary, were not recorded. In addition, The City corrected this matter beginning October 2021 and this finding did not apply from October 2021 through June 2022. In addition, in some cases, overtime charges occurred that were not supported by timesheets.

Questioned Costs: The amount of known salaries and fringe benefits charged to the federal program that were based on budgeted percentages during the fiscal year 2021-2022 is $24,358. The amount of overtime charged to the federal program that was not supported by timesheets was $853. The likely amount of questioned costs for overtime charges cannot be determined since there are no records that accurately reflect the actual work performed.

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

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Section III – Findings and Questioned Costs – Major Federal Programs

2022-005 (Continued)

Context: Payroll and fringe benefits were charged based on budgeted percentages in 2 of 12 samples tested. There was a total of 4 pay periods where two employees' wages and fringe benefits were charged to the program based on budgeted percentages. Overtime was charged without a supporting timesheet in 2 out of 12 samples tested.

Cause: The City received the comment in prior years and did not make changes for all employees for the fiscal year 2021-2022. Overtime charges that occurred without a timesheet was an error not identified or corrected through the internal control process.

Effect: The amount of personal services charged to the federal award may be over or understated.

Repeat Finding: Repeat of prior year finding number 2021-006.

Recommendation: We recommend that personnel track their actual time spent working on the program (including all other hours worked) so that an after-the-fact adjustments can be made such that the final amount charged to the federal award is accurate, allowable, and properly allocated. This recommendation was implemented by the City begi nning October 2021. We recommend that the City implement policies and procedures to review all charges to federal awards, including overtime, to verify amounts are supported by timesheets that are approved by appropriate supervisors.

Views of Responsible Officials: Since early 2021, City staff funded by CDBG/HOME entitlement grants have utilized electronic timesheets to track time s pent working on the various programs by adjusting their weekly time entries to reflect actual time spent on a specific eligible activity. In some cases, these activities are also tracked by a Journal Entry (JE) with a description of the eligible activities and an hourly breakdown provided to supplement the JE. These tracking methods ensure amounts charged to the federal awards are accurate, allowable, and properly allocated. Additionally, overtime hours inadvertently entered by Code Enforcement Staff has been addressed by Code Enforcement Supervisors who are communicating with their employees to ensure they are tracking time and completing electronic time sheets correctly. All coding changes performed by finance department personnel will be sent via email for approval by super visors until the payroll division can implement new procedures through the electronic timesheet system that will route approvals to supervisors through the established workflow. Additionally, case management / GIS system adjustments at a parcel level will be developed to further improve data correlation between claimed staff hours and program specific locations. Beginning October 2021, as noted, continuing through the reporting period with implementation ongoing since that time, the subject finding has been corrected. The personnel services charged for two employees based on budget to the program has since been corrected beginning October 2021 as noted.

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

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Section III – Findings and Questioned Costs – Major Federal Programs

2022-006

Federal Program Name: CDBG Entitlement Grants Cl uster: Community Development Block Grant (CDBG).

Assistance Listing Number: 14.218.

Federal Award Identification Number and Year: B-21-MC-06-0593; B-20-MC-06-0593; B-19-MC-06- 0593; B-18-MC-06-0593; B-17-MC-06-0593; B-16-MC-06-0593; Award Years 2021, 2020, 2019, 2018, 2017, and 2016

Award Period: Fiscal Year 2021-2022

Type of Finding:
 Significant Deficiency in Internal Control over Compliance (Allowable Costs)  Other Matter (Allowable Costs)

Criteria or Specific Requirement: Allowable Costs: Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, §200.430 requires payroll charges to be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated.

Condition: After the findings the City received in the prior year audit, the City revised the internal controls over payroll to require a supervisor's review and approval of hours charged to federal awards on the electronic timesheets, which is in line with the requirements of the Uniform Guidance. In 2 out of 12 payroll transactions tested, there was no supervisor approval of hours charged to the federal award, which was a lack of internal controls.

Questioned Costs: None since hours worked were documented (except as noted in finding 2022-005), but the support for the supervisor approval was not able to be inspected and verified.

Context: The payroll charges without supervisor approval totals $5,188 and occurred in 2 out of 12 transactions tested.

Cause: Upon receiving the prior year finding, the City was not able to implement the payroll internal control changes for all transactions in the next fiscal year since part of the year had passed before the audit procedures could be performed.

Effect: The payroll records are not in compliance with the requirements of the Uniform Guidance.

Repeat Finding: Repeat of prior year finding number 2021-007.

Recommendation: We recommend that the City ensure all timesheets require approval of hours charged to federal awards by a supervisor so that the City is in compliance with the Uniform Guidance payroll documentation requirements.

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

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Section III – Findings and Questioned Costs – Major Federal Programs

2022-006 (Continued)

Views of Responsible Officials: Since early 2021, City Staff funded by CDBG/HOME entitlement grants have utilized electronic timesheets to track time spent working on the various programs by adjusting their weekly time entries to reflect actual time spent on a specific eligible activity. In some cases, these activities are also tracked by a Jour nal Entry (JE) with a description of the eligible activities and an hourly breakdown provided to supplement the JE. These tracking methods ensure amounts charged to the federal awards are accurate, allowable, and properly allocated. Additionally, both of the methods above require supervisor approval and all City staff approving electronic time sheets related to CDBG/HOME grants have been instructed to ensure time entries are correct and eligible, with technical assistance provided by the City’s CDBG/HOME grant administration staff as needed. All coding changes performed by finance department personnel will be sent via email for approval by supervisors until the payroll division c an implement new procedures through the electronic time sheet system that will route approvals to supervi sors through the established electronic workflow.

Timesheet approval reviewers have since been updated to ensure proper supervisory personnel approves all timesheets in the event primary reviewers are absent or unable to approve.

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

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Section III – Findings and Questioned Costs – Major Federal Programs

2022-007

Federal Program Name: CDBG Entitlement Grants Cl uster: Community Development Block Grant (CDBG)

Assistance Listing Number: 14.218

Federal Award Identification Number and Year: B-21-MC-06-0593; B-20-MC-06-0593; B-19-MC-06- 0593; B-18-MC-06-0593; B-17-MC-06-0593; B-16-MC-06-0593; Award Years 2021, 2020, 2019, 2018, 2017, and 2016

Award Period: Fiscal Year 2021-2022

Type of Finding:
 Significant Deficiency in Internal Control over Compliance (Reporting)  Other Matter (Reporting)

Criteria or Specific Requirement: Reporting: Prime recipients awarded a federal grant greater than or equal to $30,000 are subject to FFATA sub-award reporting requirements as outlined in the Office of Management and Budgets guidance issued August 13, 2020. The prime recipient is required to file a FFATA subaward report by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000.

Condition: The City is a prime recipient and provided subawards totaling $135,000 to three recipients, each over the $30,000 reporting threshold. Three out of the three FFATA reports were filed for these recipients, but all were filed after the end of the month following the month in which the sub-grant was awarded.

Questioned Costs: None noted.

Context: The City is a prime recipient and provided subawards totaling $135,000 to three recipients, each over the $30,000 reporting threshold. Three out of the three FFATA reports were filed for these recipients, but all were filed after the end of the month following the month in which the sub-grant was awarded.

Cause: The City was not aware of the FFATA reporting requirements.

Effect: The City is not in compliance with the FFATA reporting requirements.

Repeat Finding: Repeat of prior year finding number 2021-008.

Recommendation: We recommend the City implement policies and procedures to ensure that FFATA reporting occurs for all subawards of $30,000 or more for all federal awards and that the reporting be performed timely.

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

(22)

Section III – Findings and Questioned Costs – Major Federal Programs

2022-007 (Continued)

Views of Responsible Officials: In May 2022, it was brought to the City’s CDBG/HOME grant staff’s attention that subawards over the amount of $30,000 must be reported under the Federal Funding Accountability and Transparency Act (FFATA). Staff contacted the City’s Department of Housing and Urban Development (HUD) representative to confir m Community Development Block Grant subawards must be entered into the Subaward Reporting S ystem. The HUD representative confirmed this requirement. The City’s CDBG/HOME grant staff began regular reporting in the system quarterly starting with the first quarter of the 2022 2023 fiscal year and has retroactively reported for fiscal year 2021-2022. In order for subawards to be entered into the system, the sub-awardee must possess a Unique Entity ID and other pertinent data that is collected with the initial grant application, which had not previously been collected in full but was collected at the subrecipient application stage beginning with the 2022-2023 fiscal year. Moving forward, City staff will confirm FFATA reporting completion in conjunction with the forwarding of official CDBG award contracts to the City Manager for final signatures, which will ensure timely filing in accordance with FFATA requirements.

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

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Section III – Findings and Questioned Costs – Major Federal Programs

2022-008

Federal Program Name: COVID-19 Coronavirus State and Local Fiscal Recovery Funds

Assistance Listing Number: 21.027

Federal Award Identification Number and Year: None

Award Period: Fiscal Year 2021-2022

Type of Finding:
 Significant Deficiency in Internal Control over Compliance (Suspension and Debarment)  Other Matter (Suspension and Debarment)

Criteria or Specific Requirement: Suspension and Debarment: 2 CFR Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards requires compliance with the provisions of suspension and debarment. The City should have internal controls designed to ensure compliance with those provisions.

Condition: The City was not able to provide supporting documentation that the verification of suspension or debarment was performed prior to entering into the contract.

Questioned Costs: None noted.

Context: There were only two vendors during fiscal year 2021-2022 that were a covered transaction for this program. While the City did not perform the suspension and debarment verification for these vendors tested, the vendors were not on the suspended and debarred listing.

Cause: The City did not maintain supporting documentation that the verification of suspension or debarment was performed prior to entering into the contract. The vendors are routinely used for IT procurement and the City has ongoing contracts. The City was under the impression that a separate verification of this vendor was not necessary.

Effect: No vendors were noted that were suspended or debarred; however, there was no documentation retained to verify that the City followed their internal controls to ensure the vendor was not suspended or debarred prior to entering into the transactions.

Repeat Finding: This is not a repeat finding.

Recommendation: We recommend that the City implement procedures to ensure that verification documentation for suspension and debarment is maintained to support the City's internal control over compliance.

CITY OF VICTORVILLE

SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
YEAR ENDED JUNE 30, 2022

(24)

Section III – Findings and Questioned Costs – Major Federal Programs

2022-008 (Continued)

Views of Responsible Officials: Finance purchasing staff will hold a nnual training which will include requirements for all purchases, based on funding, to go through this division to ensure that all required verifications and paperwork are adhered to by city personnel. Purchasing staff will also distribute a Purchasing Checklist to each department confirming the requirement to process grant funded projects/procurements through the Purchasing Division which is set up to verify suspension and disbarment status of potential awarded suppliers/contractors.

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CITY OF

VICTORVILLE
760.955.5000
FAX 760.269.0013
[email protected]
http://victorvilleca.gov
14343 Civic Drive
P.O. Box 5001
Victorville, California 92393-5001

CITY OF VICTORVILLE

SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS
YEAR ENDED JUNE 30, 2022

United States Department of Housing and Urban Development

United States Department of Treasury

The City of Victorville respectfully submits the following summary schedule of prior audit findings for the year ended June 30, 2022.

The findings from the prior audit’s schedule of findings and questioned costs are discussed below. The finding numbers are numbered consistently with the numbers assigned in the prior year.

FINANCIAL STATEMENT FINDINGS

2021-001

Condition: Amounts recorded in the general ledger for the net pension liability and corresponding deferred outflows and inflows of resources and amounts allocated to governmental activities, business-type activities, and enterprise funds for thes e amounts did not agree individually or in total to the City’s calculated pension amounts.

Status: See repeat of comment in current year finding 2022-001.

2021-002

Condition: The sanitary enterprise fund had a project in construction in progress that was expensed.

Due to audit inquiry, this amount was re-capitalized and depreciation expense was recorded.

Status: See repeat of comment in current year finding 2022-002.

2021-003

Condition: The City has various projects that are grant funded on a reimbursement basis, which means that the City incurs the cost and then requests for reimbursement from the funding source.

During our audit, we reviewed these projects and had numerous inquiries when grant receivables did not equal the unreimbursed eligible expenditures. This led to numerous adjustments to correct the balances.

Status: See repeat of comment in current year finding 2022-003.

CITY OF VICTORVILLE

SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS (CONTINUED)
YEAR ENDED JUNE 30, 2022

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2021-004

Condition: The City has loans due from the SCLAA enterprise fund to the Successor Agency to the Victorville Redevelopment Agency (Successor Agency) totaling approximately $11 million that were due to be repaid on June 30, 2014. Due to revenue shortfalls, the loans were not repaid as scheduled and there were no amendments to the underlying promissory notes to extend the period of repayment.

There are no current repayment terms or plans.

Status: Corrective action has been taken.

2021-005

Condition: Due to our audit inquiry, the City identified homes or units that were connected to the City’s water system during the fiscal year for which connection fees had been collected in advance.

These amounts were not recognized as revenue and remained a liability on the water enterprise fund’s statement of net position.

Status: Corrected.

2021-006

Condition: From July 2020 through March 2021, personal services charged were recorded based on budget to the program and an after-the-fact determination of personal services charged to the program was not conducted and adjustments, if necessary, were not recorded. In addition, The City corrected this matter beginning April 2021 and this finding did not apply from April through June 2021. In addition, in some cases, overtime charges occurred that were not supported by timesheets.

Status: Partially corrected. See repeat finding 2022-005.

2021-007

Condition: After the findings the City received in the prior year audit, the City revised the internal controls over payroll to require a supervisor's review and approval of hours charged to federal awards on the electronic timesheets, which is in line with the requirements of the Uniform Guidance. In 2 out of 17 payroll transactions tested, there was no supervisor approval of hours charged to the federal award, which was a lack of internal controls.

Status: Partially corrected. See repeat finding 2022-006.

2021-008

Condition: The City is a prime recipient and provided subawards totaling $192,538 to five recipients, each over the $30,000 reporting threshold. No FFATA reports were filed for these five recipients.

Status: Partially Corrected. See repeat finding 2022-007.

CITY OF VICTORVILLE

SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS (CONTINUED)
YEAR ENDED JUNE 30, 2022

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If the United States Department of Housing and Urban Development or United States Department of Treasury has questions regarding the schedule, please call Kim Scott, Finance Manager, at 760-955- 5081.

Signature:

Name and Title: John Mendiola, Finance Director/City Treasurer

ATTACHMENT B

CORRECTIVE ACTION PLAN

Item Number: 19
City Council / Board of Directors
Written Communications
Meeting of: June 20, 2023
Submitted By:

Keith C. Metzler, City Manager

Subject:

National Opioid Settlement Agreements
Recommendation:

That the Honorable City Council:
(1) Adopt Resolution No. 23-060, approving a budget amendment for Fiscal Year 2022- 2023 to appropriate $61,252.75 in both revenue and expenditures related to the National Opioid Settlement Agreements;
(2) Adopt Resolution No. 23-061, authorizing the City of Victorville to agree to certain settlement agreements; and
(3) Authorize the City Manager to use all Opioid Settlement Fund Disbursements, including future funds, in accordance with the List of Opioid Remediation Uses provided in the Opioid Settlements.

Fiscal Impact:

Adopting Resolution No. 23-060 will increase the City’s Fiscal Year 2022-2023 revenue budget by $61,252.75 (2654020-47415-42006) and increase the expense appropriations by $61,252.75 (2654020-52300-42006). All future Opioid Settlement Fund Disbursements will be used in accordance with the List of Opioid Remediation Uses.

Strategic Plan Goal:

The City of Victorville Strategic Plan 2020-2023 identifies multi-year strategic goals and various strategies to work toward achieving those goals. Goal D, Reduce Homelessness, focuses on implementing effective solutions to reduce homelessness.

Background:

On December 7, 2021, a Closed Session item was presented to the City Council relating to the National Prescription Opiate Litigation Settlements with opioid manufacturer Janssen Pharmaceuticals (parent company of Johnson & Johnson) and the “big three" distributors, McKesson, AmerisourceBergen, and Cardinal Health (“the Distributors") and 3 1
4 3
authorized the City Manager as the City's authorized representative to take all reasonable and necessary actions related to the settlements. Since the initial settlements with Janssen and Distributors, new National Opioid Settlements have been reached with Teva, Allergan, Walmart, CVS and Walgreens, which the City has elected to participate in.

Before the settlement funds were allocated to state and local governments, the City had three options for receiving these funds; allocate 100% of the proceeds to San Bernardino County, allocate a percentage of proceeds to San Bernardino County, or elect to receive 100% of the funds. It was the City Council's direction to receive the entire yearly allotment directly. On December 22, 2021, a letter was sent to Leonard Hernandez, Chief Executive Officer of San Bernardino County, informing him of said allotment and that the City will assist the County in addressing the opioid crisis in our community.

The National Opioid Settlement Agreements will provide substantial funds to states and eligible local governments for the abatement of the opioid epidemic across the country.

The settlement totals approximately $46 billion ($21 billion from the Distributors, $20 billion from Teva, Allergan, Walmart, CVS, and Walgreens, and $5 billion from Janssen Pharmaceuticals). Of this potential $46 billion, approximately $44 billion in settlement proceeds are payable to state and local governments. Funds from each settlement will be distributed to the City for a period of up to eighteen (18) years.

The National Opioid Settlements will be distributed as follows:
•Distributors will pay a maximum of $21 billion over 18 years; •Teva is to pay up to $3.34 billion over 13 years and to provide either $1.2 billion of its generic version of the drug Narcan over 10 years or $240 million of cash in lieu of product, as each state may elect;
•Allergan to pay up to $2.02 billion over 7 years;
•Walmart to pay up to $2.74 billion in 2023, and all payments to be made within 6 years;
•CVS to pay up to $4.90 billion over 10 years;
•Walgreens to pay up to $5.52 billion over 15 years; and •Janssen will pay a maximum of $5 billion over no more than nine years.

The settlement proceeds to be paid to state and local governments are proportional to the number of state and local governments that approved the settlements. Based on the allocation formula for the states, the maximum amount California will receive will be approximately $2.05 billion from the Distributors and Janssen Agreements, and the multistate settlements with Teva, Allergan, Walmart, CVS and Walgreens are currently pending. Victorville will receive approximately $415,000 over 18 years.

Discussion:

In 2021, San Bernardino County had 349 deaths related to any opioid overdose, 1,065 emergency department visits, 243 hospitalizations, and 966,931 prescriptions for opioids.

On October 17, 2022, the San Bernardino County Health Officer issued a health advisory 3 1
4 3
to bring attention to the dangers of fentanyl due to the marked increase of overdose deaths in the county.

The San Bernardino County's Point-In-Time Count reflected 25.5% in 2022 and 33.5% in 2023 of the Victorville homeless population having a substance use disorder. This results in an 8% increase from the previous year.

High Desert Homeless Services (HDHS), the Interim Shelter operator, has reported issues regarding client drug abuse. Monthly data indicates that over half of the Interim Shelters population has a substance use disorder and/or requires medication to address a mental health or physical ailment. Given our low-barrier approach to shelter admission, shelter clients require a higher level of care. HDHS’s Substance Use Disorder (SUD) case manager indicated the need for a structured program, such as journaling, dialectical behavior therapy, or a cognitive-behavioral approach to provide our clients with evidence- based psychoeducation. Additionally, there have been instances where Narcan has been administered to address overdoses. Although the staff is prepared for situations that arise when an overdose occurs, they would benefit from additional training, programming, and services that will educate clients and prevent such incidents from occurring. This program will be equally important once the Wellness Center is operative.

Thus far, the City has received $61,252.75 from the National Opioid Settlements. These settlement funds are restricted on how they can be expended and must align with the List of Opioid Remediation Uses shown in Attachment B. After reviewing the qualified opioid remediation uses from the Opioid Settlements, staff recommends that the funds should be used for the following:

1. Additional training for the Interim Shelter, Wellness Center, and City staff. Training will include topics such as resilience, motivational interviewing, Cognitive-Behavioral Therapy (CBT), transtheoretical model of behavioral change, integrity, fidelity, skill enhancements, trauma-informed care, interactive journaling, opioid overdose first aid, and life-saving CPR/First Aid/AED training.

2. Evidence-based psychoeducational and counseling services for Interim Shelter and Wellness Center Campus clients. Broadened scope of recovery services to include co- occurring SUD or mental health conditions.

3. Comprehensive wraparound services to individuals in recovery, including housing, transportation, and job placement/training at both the Wellness Center and through community outreach. Support the shelter and wraparound services at the Wellness Center and the City’s outreach services related to opioid remediation uses.

4. Providing awareness of the opioid crisis through potential campaigns.

5. Any other expenditures in accordance with the List of Opioid Remediation Uses.

The Interim Shelter currently has one full-time SUD Counselor available for clients. Once operable, the Wellness Center will provide additional SUD counselors from the Symba 3 1
4 3
Center, which is the Wraparound Services Provider. Staff anticipates the continued need for substance abuse services at the Wellness Center and through community outreach.

Evidence-based psychoeducation, awareness, staff training, and wraparound services already exist at the Interim Shelter. Said services planned for the Wellness Center will help support the wellness of those individuals in need and address the opioid crisis by enhancing the wraparound services by improving staff’s ability to provide impactful and appropriate services. This will also broaden the scope of recovery services to solidify a heightened approach that would best benefit the client.

Staff recommends that the Honorable City Council adopt Resolution No. 23-060 and authorize the City Manager to use all Opioid Settlement Fund Disbursements, including future funds, in accordance with the List of Opioid Remediation Uses provided in the Opioid Settlements.

Staff remains available for any questions the City Council may have.

Attachments: A. Resolution No. 23-060
B. Resolution No. 23-061
C. List of Opioid Remediation Uses

Attachment A
Resolution No. 23-060

RESOLUTION NO. 23-060

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF VICTORVILLE AMENDING THE ANNUAL BUDGET FOR FISCAL YEAR 20 22-2023; APPROVING ADDITIONAL

APPROPRIATIONS AND ADDITIONAL REVENUE AND EXPENDITURES FOR THE

NATIONAL OPIOIDS SETTLEMENT AGREEMENTS

WHEREAS, the City Manager of the City of Victorville did heretofore submit to the City Council an estimate of the expen ditures and revenues of the City departments and offices, together with a proposed budget for the fiscal year 2022-2023; and

WHEREAS, copies of said budget were prepared and distributed to the City Council, approved by the City Council prior to June 30, 20 22 and have been available for the inspection by the public in the office of the City Clerk of the City of Victorville; and

WHEREAS, after preparation of the budget, notification of National Opioid Settlement funds were received by the City in the amount of $61,252.75; and

WHEREAS, the City Manager or his designee will provide all necessary justification for the budget amen dment as an attachment to this resolution or in the associated City Council agenda report.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF VICTORVILLE DOES HEREBY RESOLVE AS FOLLOWS:

SECTION 1. That the annual budget for the fiscal year 2022-2023 for the City of Victorville be hereby amended to reflect a change in the amounts and associated accounts listed below and as described in the corresponding Agenda Item.

Account Amount Adjusted
2654020-47415-42006 (Revenue) $61,252.75
2654020-52300-42006 (Expenditure) $61,252.75

SECTION 2. That copies of such amended budget, certified by the City Clerk, shall be filed with the auditors of the City of Victorville and in the office of the City Clerk for public inspection and certified copies thereof shall be made available for use by City departments, offices and subsidiary districts of the City.

SECTION 3. This Resolution shall take effect immediately upon its adoption.

Attachment B
Resolution No. 23-061

2 RESOLUTION NO. 23-061

A RESOLUTION OF THE CITY OF VICTORVILLE AUTHORIZING THE CITY OF VICTORVILLE (“CITY”) TO AGREE TO CERTAIN SETTLEMENT AGREEMENTS

RELATED TO THE MANUFACTURE AND DISTRIBUTION OF VARIOUS OPIOIDS,

AND AUTHORIZE ENTRY INTO THE STATE-SUBDIVISION AGREEMENTS WITH

THE ATTORNEY GENERAL

WHEREAS, the United States is facing an ongoing public health crisis of opioid abuse, addiction, overdose, and death, forcing the State of California and California counties and cities to spend billions of dollars each year to address the direct consequences of this crisis; and,

WHEREAS, there was pending in the U.S. District Court for the Northern District of Ohio, a multidistrict litigation pursued by numerous public entity plaintiffs against the manufacturers and distributors of various opioids based on the allegation that the defendants’ unlawful conduct caused the opioid epidemic; and,

WHEREAS, in connection with the litigation, certain Settlement Agreements have been reached between the plaintiffs in the litigation and several of the d efendants (collectively, the “Settling Defendants”); and,

WHEREAS, as part of the settlement with the Settling Defendants, local subdivisions, including certain cities, that are not plaintiffs in the litigation may participate in the settlement in exchange for a release of the Settling Defendants; and,

WHEREAS, the Settlement Agreements provide, among other things, for the payment of a certain sum to settling government entities in California, including to the State of California and Participating Subdivisions upon occurrence of certain events as defined in the Settlement Agreements (“California Opioid Funds”); and,

WHEREAS, under the Settlement Agreements, certain local subdivisions that did not file a lawsuit against the Settlement Defendants may qualify to participate in the settlement and obtain funds from the Abatement Account Fund; and,

WHEREAS, the City is eligible to participate in the s ettlement and become a CA Participating Subdivision; and,

WHEREAS, it is the intent of this Resolution to authorize the C ity to enter into the Settlement Agreements by executing the signature page to those agreements.

NOW, THEREFORE, BE IT RESOLVED: the C ity Council hereby approves and authorizes City Manager, Keith C. Metzler to execute the Settlement Agreements, direct the use of the proceeds received according to the terms of the Settlement Agreements and all exhibits thereto.

3 BE IT FURTHER RESOLVED that all actions heretofore taken by the City Council and other appropriate public officers and agents of the C ity with respect to the matters contemplated under this Resolution are hereby ratified, confirmed and approved.

Adopted by the Victorville City Council this ___ day of ____________, 2023.

___________________________________
Keith C. Metzler
City Manager

ATTEST:

___________________________________
Jennifer Thompson
City Clerk

Attachment C
List of Opioid Remediation Uses
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EXHIBIT E
List of Opioid Remediation Uses
Schedule A
Core Strategies
States and Qualifying Block Grantees shall choose from among the abatement strategies listed in Schedule B. However, priority shall be given to the following core abatement strategies (“Core Strategies”).14
A. NALOXONE OR OTHER FDA-APPROVED DRUG TO

REVERSE OPIOID OVERDOSES

1. Expand training for first responders, schools, community support groups and families; and

2. Increase distribution to individuals who are uninsured or whose insurance does not cover the needed service.

B. MEDICATION-ASSISTED TREATMENT (“MAT”)

DISTRIBUTION AND OTHER OPIOID-RELATED

TREATMENT

1. Increase distribution of MAT to individuals who are
uninsured or whose insurance does not cover the needed
service;

2. Provide education to school-based and youth-focused
programs that discourage or prevent misuse;

3. Provide MAT education and awareness training to
healthcare providers, EMTs, law enforcement, and other
first responders; and

4. Provide treatment and recovery support services such as residential and inpatient treatment, intensive outpatient treatment, outpatient therapy or counseling, and recovery housing that allow or integrate medication and with other support services.
14 As used in this Schedule A, words like “expand,” “fund,” “provide” or the like shall not indicate a preference for new or existing programs.

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C. PREGNANT & POSTPARTUM WOMEN

1. Expand Screening, Brief Intervention, and Referral to Treatment (“SBIRT”) services to non-Medicaid eligible or uninsured pregnant women;

2. Expand comprehensive evidence-based treatment and
recovery services, including MAT, for women with co-
occurring Opioid Use Disorder (“OUD”) and other
Substance Use Disorder (“SUD”)/Mental Health disorders
for uninsured individuals for up to 12 months postpartum; and

3. Provide comprehensive wrap-around services to individuals with OUD, including housing, transportation, job
placement/training, and childcare.

D. EXPANDING TREATMENT FOR NEONATAL
ABSTINENCE SYNDROME (“NAS”)

1. Expand comprehensive evidence-based and recovery
support for NAS babies;

2. Expand services for better continuum of care with infant- need dyad; and

3. Expand long-term treatment and services for medical
monitoring of NAS babies and their families.

E. EXPANSION OF WARM HAND-OFF PROGRAMS AND

RECOVERY SERVICES

1. Expand services such as navigators and on-call teams to begin MAT in hospital emergency departments;

2. Expand warm hand-off services to transition to recovery services;

3. Broaden scope of recovery services to include co-occurring SUD or mental health conditions;

4. Provide comprehensive wrap-around services to individuals in recovery, including housing, transportation, job
placement/training, and childcare; and

5. Hire additional social workers or other behavioral health workers to facilitate expansions above.

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F. TREATMENT FOR INCARCERATED POPULATION

1. Provide evidence-based treatment and recovery support, including MAT for persons with OUD and co-occurring
SUD/MH disorders within and transitioning out of the
criminal justice system; and

2. Increase funding for jails to provide treatment to inmates with OUD.

G. PREVENTION PROGRAMS

1. Funding for media campaigns to prevent opioid use (similar to the FDA’s “Real Cost” campaign to prevent youth from misusing tobacco);

2. Funding for evidence-based prevention programs in
schools;

3. Funding for medical provider education and outreach
regarding best prescribing practices for opioids consistent with the 2016 CDC guidelines, including providers at
hospitals (academic detailing);

4. Funding for community drug disposal programs; and

5. Funding and training for first responders to participate in pre-arrest diversion programs, post-overdose response
teams, or similar strategies that connect at-risk individuals to behavioral health services and supports.

H. EXPANDING SYRINGE SERVICE PROGRAMS

1. Provide comprehensive syringe services programs with more wrap-around services, including linkage to OUD
treatment, access to sterile syringes and linkage to care and treatment of infectious diseases.

I. EVIDENCE-BASED DATA COLLECTION AND

RESEARCH ANALYZING THE EFFECTIVENESS OF THE

ABATEMENT STRATEGIES WITHIN THE STATE

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Schedule B
Approved Uses
Support treatment of Opioid Use Disorder (OUD) and any co-occurring Substance Use Disorder or Mental Health (SUD/MH) conditions through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, the following:

PART ONE: TREATMENT

A. TREAT OPIOID USE DISORDER (OUD)
Support treatment of Opioid Use Disorder (“OUD”) and any co-occurring Substance Use Disorder or Mental Health (“SUD/MH”) conditions through evidence-based or evidence- informed programs or strategies that may include, but are not limited to, those that:15

1. Expand availability of treatment for OUD and any co-occurring SUD/MH conditions, including all forms of Medication-Assisted Treatment (“MAT”) approved by the U.S. Food and Drug Administration.

2. Support and reimburse evidence-based services that adhere to the American Society of Addiction Medicine (“ASAM”) continuum of care for OUD and any co- occurring SUD/MH conditions.

3. Expand telehealth to increase access to treatment for OUD and any co-occurring SUD/MH conditions, including MAT, as well as counseling, psychiatric support, and other treatment and recovery support services.

4. Improve oversight of Opioid Treatment Programs (“OTPs”) to assure evidence- based or evidence-informed practices such as adequate methadone dosing and low threshold approaches to treatment.

5. Support mobile intervention, treatment, and recovery services, offered by qualified professionals and service providers, such as peer recovery coaches, for persons with OUD and any co-occurring SUD/MH conditions and for persons who have experienced an opioid overdose.

6. Provide treatment of trauma for individuals with OUD (e.g., violence, sexual assault, human trafficking, or adverse childhood experiences) and family members (e.g., surviving family members after an overdose or overdose fatality), and training of health care personnel to identify and address such trauma.

7. Support evidence-based withdrawal management services for people with OUD and any co-occurring mental health conditions.

15 As used in this Schedule B, words like “expand,” “fund,” “provide” or the like shall not indicate a preference for new or existing programs.

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8. Provide training on MAT for health care providers, first responders, students, or other supporting professionals, such as peer recovery coaches or recovery outreach specialists, including telementoring to assist community-based providers in rural or underserved areas.

9. Support workforce development for addiction professionals who work with persons with OUD and any co-occurring SUD/MH conditions.

10. Offer fellowships for addiction medicine specialists for direct patient care, instructors, and clinical research for treatments.

11. Offer scholarships and supports for behavioral health practitioners or workers involved in addressing OUD and any co-occurring SUD/MH or mental health conditions, including, but not limited to, training, scholarships, fellowships, loan repayment programs, or other incentives for providers to work in rural or underserved areas.

12. Provide funding and training for clinicians to obtain a waiver under the federal Drug Addiction Treatment Act of 2000 (“DATA 2000”) to prescribe MAT for OUD, and provide technical assistance and professional support to clinicians who have obtained a DATA 2000 waiver.

13. Disseminate of web-based training curricula, such as the American Academy of Addiction Psychiatry’s Provider Clinical Support Service–Opioids web-based training curriculum and motivational interviewing.

14. Develop and disseminate new curricula, such as the American Academy of Addiction Psychiatry’s Provider Clinical Support Service for Medication– Assisted Treatment.

B. SUPPORT PEOPLE IN TREATMENT AND RECOVERY
Support people in recovery from OUD and any co-occurring SUD/MH conditions through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, the programs or strategies that:

1. Provide comprehensive wrap-around services to individuals with OUD and any co-occurring SUD/MH conditions, including housing, transportation, education, job placement, job training, or childcare.

2. Provide the full continuum of care of treatment and recovery services for OUD and any co-occurring SUD/MH conditions, including supportive housing, peer support services and counseling, community navigators, case management, and connections to community-based services.

3. Provide counseling, peer-support, recovery case management and residential treatment with access to medications for those who need it to persons with OUD and any co-occurring SUD/MH conditions.

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4. Provide access to housing for people with OUD and any co-occurring SUD/MH conditions, including supportive housing, recovery housing, housing assistance programs, training for housing providers, or recovery housing programs that allow or integrate FDA-approved mediation with other support services.

5. Provide community support services, including social and legal services, to assist in deinstitutionalizing persons with OUD and any co-occurring SUD/MH conditions.

6. Support or expand peer-recovery centers, which may include support groups, social events, computer access, or other services for persons with OUD and any co-occurring SUD/MH conditions.

7. Provide or support transportation to treatment or recovery programs or services for persons with OUD and any co-occurring SUD/MH conditions.

8. Provide employment training or educational services for persons in treatment for or recovery from OUD and any co-occurring SUD/MH conditions.

9. Identify successful recovery programs such as physician, pilot, and college recovery programs, and provide support and technical assistance to increase the number and capacity of high-quality programs to help those in recovery.

10. Engage non-profits, faith-based communities, and community coalitions to support people in treatment and recovery and to support family members in their efforts to support the person with OUD in the family.

11. Provide training and development of procedures for government staff to appropriately interact and provide social and other services to individuals with or in recovery from OUD, including reducing stigma.

12. Support stigma reduction efforts regarding treatment and support for persons with OUD, including reducing the stigma on effective treatment.

13. Create or support culturally appropriate services and programs for persons with OUD and any co-occurring SUD/MH conditions, including new Americans.

14. Create and/or support recovery high schools.

15. Hire or train behavioral health workers to provide or expand any of the services or supports listed above.

C. CONNECT PEOPLE WHO NEED HELP TO THE HELP THEY NEED
(CONNECTIONS TO CARE)
Provide connections to care for people who have—or are at risk of developing—OUD and any co-occurring SUD/MH conditions through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, those that:

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1. Ensure that health care providers are screening for OUD and other risk factors and know how to appropriately counsel and treat (or refer if necessary) a patient for OUD treatment.

2. Fund SBIRT programs to reduce the transition from use to disorders, including SBIRT services to pregnant women who are uninsured or not eligible for Medicaid.

3. Provide training and long-term implementation of SBIRT in key systems (health, schools, colleges, criminal justice, and probation), with a focus on youth and young adults when transition from misuse to opioid disorder is common.

4. Purchase automated versions of SBIRT and support ongoing costs of the technology.

5. Expand services such as navigators and on-call teams to begin MAT in hospital emergency departments.

6. Provide training for emergency room personnel treating opioid overdose patients on post-discharge planning, including community referrals for MAT, recovery case management or support services.

7. Support hospital programs that transition persons with OUD and any co-occurring SUD/MH conditions, or persons who have experienced an opioid overdose, into clinically appropriate follow-up care through a bridge clinic or similar approach.

8. Support crisis stabilization centers that serve as an alternative to hospital emergency departments for persons with OUD and any co-occurring SUD/MH conditions or persons that have experienced an opioid overdose.

9. Support the work of Emergency Medical Systems, including peer support specialists, to connect individuals to treatment or other appropriate services following an opioid overdose or other opioid-related adverse event.

10. Provide funding for peer support specialists or recovery coaches in emergency departments, detox facilities, recovery centers, recovery housing, or similar settings; offer services, supports, or connections to care to persons with OUD and any co-occurring SUD/MH conditions or to persons who have experienced an opioid overdose.

11. Expand warm hand-off services to transition to recovery services.

12. Create or support school-based contacts that parents can engage with to seek immediate treatment services for their child; and support prevention, intervention, treatment, and recovery programs focused on young people.

13. Develop and support best practices on addressing OUD in the workplace.

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14. Support assistance programs for health care providers with OUD.

15. Engage non-profits and the faith community as a system to support outreach for treatment.

16. Support centralized call centers that provide information and connections to appropriate services and supports for persons with OUD and any co-occurring SUD/MH conditions.

D. ADDRESS THE NEEDS OF CRIMINAL JUSTICE-INVOLVED PERSONS Address the needs of persons with OUD and any co-occurring SUD/MH conditions who are involved in, are at risk of becoming involved in, or are transitioning out of the criminal justice system through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, those that:

1. Support pre-arrest or pre-arraignment diversion and deflection strategies for persons with OUD and any co-occurring SUD/MH conditions, including established strategies such as:

1. Self-referral strategies such as the Angel Programs or the Police Assisted Addiction Recovery Initiative (“PAARI”);

2. Active outreach strategies such as the Drug Abuse Response Team (“DART”) model;

3. “Naloxone Plus” strategies, which work to ensure that individuals who have received naloxone to reverse the effects of an overdose are then linked to treatment programs or other appropriate services;

4. Officer prevention strategies, such as the Law Enforcement Assisted Diversion (“LEAD”) model;

5. Officer intervention strategies such as the Leon County, Florida Adult Civil Citation Network or the Chicago Westside Narcotics Diversion to Treatment Initiative; or

6. Co-responder and/or alternative responder models to address OUD-related 911 calls with greater SUD expertise.

2. Support pre-trial services that connect individuals with OUD and any co- occurring SUD/MH conditions to evidence-informed treatment, including MAT, and related services.

3. Support treatment and recovery courts that provide evidence-based options for persons with OUD and any co-occurring SUD/MH conditions.

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4. Provide evidence-informed treatment, including MAT, recovery support, harm reduction, or other appropriate services to individuals with OUD and any co- occurring SUD/MH conditions who are incarcerated in jail or prison.

5. Provide evidence-informed treatment, including MAT, recovery support, harm reduction, or other appropriate services to individuals with OUD and any co- occurring SUD/MH conditions who are leaving jail or prison or have recently left jail or prison, are on probation or parole, are under community corrections supervision, or are in re-entry programs or facilities.

6. Support critical time interventions (“CTI”), particularly for individuals living with dual-diagnosis OUD/serious mental illness, and services for individuals who face immediate risks and service needs and risks upon release from correctional settings.

7. Provide training on best practices for addressing the needs of criminal justice- involved persons with OUD and any co-occurring SUD/MH conditions to law enforcement, correctional, or judicial personnel or to providers of treatment, recovery, harm reduction, case management, or other services offered in connection with any of the strategies described in this section.

E. ADDRESS THE NEEDS OF PREGNANT OR PARENTING WOMEN AND

THEIR FAMILIES, INCLUDING BABIES WITH NEONATAL ABSTINENCE

SYNDROME
Address the needs of pregnant or parenting women with OUD and any co-occurring SUD/MH conditions, and the needs of their families, including babies with neonatal abstinence syndrome (“NAS”), through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, those that:

1. Support evidence-based or evidence-informed treatment, including MAT, recovery services and supports, and prevention services for pregnant women—or women who could become pregnant—who have OUD and any co-occurring SUD/MH conditions, and other measures to educate and provide support to families affected by Neonatal Abstinence Syndrome.

2. Expand comprehensive evidence-based treatment and recovery services, including MAT, for uninsured women with OUD and any co-occurring SUD/MH conditions for up to 12 months postpartum.

3. Provide training for obstetricians or other healthcare personnel who work with pregnant women and their families regarding treatment of OUD and any co- occurring SUD/MH conditions.

4. Expand comprehensive evidence-based treatment and recovery support for NAS babies; expand services for better continuum of care with infant-need dyad; and expand long-term treatment and services for medical monitoring of NAS babies and their families.

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5. Provide training to health care providers who work with pregnant or parenting women on best practices for compliance with federal requirements that children born with NAS get referred to appropriate services and receive a plan of safe care.

6. Provide child and family supports for parenting women with OUD and any co- occurring SUD/MH conditions.

7. Provide enhanced family support and child care services for parents with OUD and any co-occurring SUD/MH conditions.

8. Provide enhanced support for children and family members suffering trauma as a result of addiction in the family; and offer trauma-informed behavioral health treatment for adverse childhood events.

9. Offer home-based wrap-around services to persons with OUD and any co- occurring SUD/MH conditions, including, but not limited to, parent skills training.

10. Provide support for Children’s Services—Fund additional positions and services, including supportive housing and other residential services, relating to children being removed from the home and/or placed in foster care due to custodial opioid use.

PART TWO: PREVENTION
F. PREVENT OVER-PRESCRIBING AND ENSURE APPROPRIATE

PRESCRIBING AND DISPENSING OF OPIOIDS
Support efforts to prevent over-prescribing and ensure appropriate prescribing and dispensing of opioids through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, the following:

1. Funding medical provider education and outreach regarding best prescribing practices for opioids consistent with the Guidelines for Prescribing Opioids for Chronic Pain from the U.S. Centers for Disease Control and Prevention, including providers at hospitals (academic detailing).

2. Training for health care providers regarding safe and responsible opioid prescribing, dosing, and tapering patients off opioids.

3. Continuing Medical Education (CME) on appropriate prescribing of opioids.

4. Providing Support for non-opioid pain treatment alternatives, including training providers to offer or refer to multi-modal, evidence-informed treatment of pain.

5. Supporting enhancements or improvements to Prescription Drug Monitoring Programs (“PDMPs”), including, but not limited to, improvements that:

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1. Increase the number of prescribers using PDMPs;

2. Improve point-of-care decision-making by increasing the quantity, quality, or format of data available to prescribers using PDMPs, by improving the interface that prescribers use to access PDMP data, or both; or

3. Enable states to use PDMP data in support of surveillance or intervention strategies, including MAT referrals and follow-up for individuals identified within PDMP data as likely to experience OUD in a manner that complies with all relevant privacy and security laws and rules.

6. Ensuring PDMPs incorporate available overdose/naloxone deployment data, including the United States Department of Transportation’s Emergency Medical Technician overdose database in a manner that complies with all relevant privacy and security laws and rules.

7. Increasing electronic prescribing to prevent diversion or forgery.

8. Educating dispensers on appropriate opioid dispensing.

G. PREVENT MISUSE OF OPIOIDS
Support efforts to discourage or prevent misuse of opioids through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, the following:

1. Funding media campaigns to prevent opioid misuse.

2. Corrective advertising or affirmative public education campaigns based on evidence.

3. Public education relating to drug disposal.

4. Drug take-back disposal or destruction programs.

5. Funding community anti-drug coalitions that engage in drug prevention efforts.

6. Supporting community coalitions in implementing evidence-informed prevention, such as reduced social access and physical access, stigma reduction—including staffing, educational campaigns, support for people in treatment or recovery, or training of coalitions in evidence-informed implementation, including the Strategic Prevention Framework developed by the U.S. Substance Abuse and Mental Health Services Administration (“SAMHSA”).

7. Engaging non-profits and faith-based communities as systems to support prevention.

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8. Funding evidence-based prevention programs in schools or evidence-informed school and community education programs and campaigns for students, families, school employees, school athletic programs, parent-teacher and student associations, and others.

9. School-based or youth-focused programs or strategies that have demonstrated effectiveness in preventing drug misuse and seem likely to be effective in preventing the uptake and use of opioids.

10. Create or support community-based education or intervention services for families, youth, and adolescents at risk for OUD and any co-occurring SUD/MH conditions.

11. Support evidence-informed programs or curricula to address mental health needs of young people who may be at risk of misusing opioids or other drugs, including emotional modulation and resilience skills.

12. Support greater access to mental health services and supports for young people, including services and supports provided by school nurses, behavioral health workers or other school staff, to address mental health needs in young people that (when not properly addressed) increase the risk of opioid or another drug misuse.

H. PREVENT OVERDOSE DEATHS AND OTHER HARMS (HARM REDUCTION) Support efforts to prevent or reduce overdose deaths or other opioid-related harms through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, the following:

1. Increased availability and distribution of naloxone and other drugs that treat overdoses for first responders, overdose patients, individuals with OUD and their friends and family members, schools, community navigators and outreach workers, persons being released from jail or prison, or other members of the general public.

2. Public health entities providing free naloxone to anyone in the community.

3. Training and education regarding naloxone and other drugs that treat overdoses for first responders, overdose patients, patients taking opioids, families, schools, community support groups, and other members of the general public.

4. Enabling school nurses and other school staff to respond to opioid overdoses, and provide them with naloxone, training, and support.

5. Expanding, improving, or developing data tracking software and applications for overdoses/naloxone revivals.

6. Public education relating to emergency responses to overdoses.

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7. Public education relating to immunity and Good Samaritan laws.

8. Educating first responders regarding the existence and operation of immunity and Good Samaritan laws.

9. Syringe service programs and other evidence-informed programs to reduce harms associated with intravenous drug use, including supplies, staffing, space, peer support services, referrals to treatment, fentanyl checking, connections to care, and the full range of harm reduction and treatment services provided by these programs.

10. Expanding access to testing and treatment for infectious diseases such as HIV and Hepatitis C resulting from intravenous opioid use.

11. Supporting mobile units that offer or provide referrals to harm reduction services, treatment, recovery supports, health care, or other appropriate services to persons that use opioids or persons with OUD and any co-occurring SUD/MH conditions.

12. Providing training in harm reduction strategies to health care providers, students, peer recovery coaches, recovery outreach specialists, or other professionals that provide care to persons who use opioids or persons with OUD and any co- occurring SUD/MH conditions.

13. Supporting screening for fentanyl in routine clinical toxicology testing.

PART THREE: OTHER STRATEGIES

I. FIRST RESPONDERS
In addition to items in section C, D and H relating to first responders, support the following:

1. Education of law enforcement or other first responders regarding appropriate practices and precautions when dealing with fentanyl or other drugs.

2. Provision of wellness and support services for first responders and others who experience secondary trauma associated with opioid-related emergency events.

J. LEADERSHIP, PLANNING AND COORDINATION
Support efforts to provide leadership, planning, coordination, facilitations, training and technical assistance to abate the opioid epidemic through activities, programs, or strategies that may include, but are not limited to, the following:

1. Statewide, regional, local or community regional planning to identify root causes of addiction and overdose, goals for reducing harms related to the opioid epidemic, and areas and populations with the greatest needs for treatment

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intervention services, and to support training and technical assistance and other strategies to abate the opioid epidemic described in this opioid abatement strategy list.

2. A dashboard to (a) share reports, recommendations, or plans to spend opioid settlement funds; (b) to show how opioid settlement funds have been spent; (c) to report program or strategy outcomes; or (d) to track, share or visualize key opioid- or health-related indicators and supports as identified through collaborative statewide, regional, local or community processes.

3. Invest in infrastructure or staffing at government or not-for-profit agencies to support collaborative, cross-system coordination with the purpose of preventing overprescribing, opioid misuse, or opioid overdoses, treating those with OUD and any co-occurring SUD/MH conditions, supporting them in treatment or recovery, connecting them to care, or implementing other strategies to abate the opioid epidemic described in this opioid abatement strategy list.

4. Provide resources to staff government oversight and management of opioid abatement programs.

K. TRAINING
In addition to the training referred to throughout this document, support training to abate the opioid epidemic through activities, programs, or strategies that may include, but are not limited to, those that:

1. Provide funding for staff training or networking programs and services to improve the capability of government, community, and not-for-profit entities to abate the opioid crisis.

2. Support infrastructure and staffing for collaborative cross-system coordination to prevent opioid misuse, prevent overdoses, and treat those with OUD and any co- occurring SUD/MH conditions, or implement other strategies to abate the opioid epidemic described in this opioid abatement strategy list (e.g., health care, primary care, pharmacies, PDMPs, etc.).

L. RESEARCH
Support opioid abatement research that may include, but is not limited to, the following:

1. Monitoring, surveillance, data collection and evaluation of programs and strategies described in this opioid abatement strategy list.

2. Research non-opioid treatment of chronic pain.

3. Research on improved service delivery for modalities such as SBIRT that demonstrate promising but mixed results in populations vulnerable to opioid use disorders.

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4. Research on novel harm reduction and prevention efforts such as the provision of fentanyl test strips.

5. Research on innovative supply-side enforcement efforts such as improved detection of mail-based delivery of synthetic opioids.

6. Expanded research on swift/certain/fair models to reduce and deter opioid misuse within criminal justice populations that build upon promising approaches used to address other substances (e.g., Hawaii HOPE and Dakota 24/7).

7. Epidemiological surveillance of OUD-related behaviors in critical populations, including individuals entering the criminal justice system, including, but not limited to approaches modeled on the Arrestee Drug Abuse Monitoring (“ADAM”) system.

8. Qualitative and quantitative research regarding public health risks and harm reduction opportunities within illicit drug markets, including surveys of market participants who sell or distribute illicit opioids.

9. Geospatial analysis of access barriers to MAT and their association with treatment engagement and treatment outcomes.

Item Number: 20
City Council / Board of Directors
Written Communications
Meeting of: June 20, 2023
Submitted By:

Jennifer Thompson, City Clerk

Subject:

Fiscal Year 2023-2024 Training Schedule for City Council Members Recommendation:

That Your Honorable City Council direct staff which business events Council will attend during Fiscal Year 2023-2024 to allow sufficient time for registration and travel accommodations.

Fiscal Impact:

Unknown at this time, and dependent upon registration fees and travel costs. City Council travel and meetings expense account 1001220-52150 has a budgeted amount of $26,000 for Fiscal Year 2023-2024.

Strategic Plan Goal:

Goal F: Communication and Outreach – Attendance allows Council Members the opportunity to collaborate with other jurisdictions and build on relationships.

Discussion:

At the February 28, 2023, Governance Team Relations Workshop, Baker Tilly discussed the importance of continued training for Council Members. Pursuant to City Council Policy and Procedures Manual, Chapter 8 Section IV(C) "Prior to making travel, transportation, and/or lodging arrangements for any event for which a Councilmember wishes to be reimbursed by the City, the Councilmember must have the event and the expenditure approved. Requests for travel and meeting expense reimbursements or City- paid travel and meetings for any event(s) will require the advance approval of the City Council at a regularly-scheduled Council Meeting under an agendized item requesting such approval."
This item is being presented to establish a list of approved business events the Council desires to attend during Fiscal Year 2023-2024. Council approval of business travel in 3 1
2 4
advance will provide staff the flexibility and time to research the best prices for travel accommodations for all interested Council Members, as soon as registration and hotel blocks are announced, and ensure space availability as some events meet capacity quickly.

The table below identifies events organized by the League of California Cities and the City/County Conference.

Event Name Dates/Locations Costs
Annual League of California Cities
Conference
September 20-23, 2023
SAFE Credit Union
Convention Center,
Sacramento
$600 Registration
+ Travel
New Mayors and Council Members
Academy
January 24-26, 2024
Monterey, CA
$625 Registration
+ Travel
City Leaders Summit April 17-19, 2024
SAFE Credit Union
Convention Center,
Sacramento
$625 Registration
+ Travel
City/County Conference April 2024
Lake Arrowhead
$200 Registration
+ Hotel
Staff remains available for any questions or comments you might have.

Attachments: None
Item Number: 21
City Council / Board of Directors
Written Communications
Meeting of: June 20, 2023
Submitted By:

Jennifer Thompson, City Clerk

Subject:

Fentanyl Awareness and Education Program
Recommendation:

Any action is at the discretion of Your Honorable City Council.

Fiscal Impact:

There are no fiscal impacts associated with this item.

Background:

At the City Council meeting of June 6, 2023, it was moved by Council Member Harriman and approved by a majority vote to agendize an item for discussion and possible action to consider whether or not the City might want to institute a fentanyl awareness and education program in the City.

Discussion:

This item is being presented to Council so that Council can further discuss and if the Council wishes to consider whether or not the City might want to institute a fentanyl awareness and education program in the City.

Staff remains available for any questions or comments you might have.

Attachments: None
Item Number: 22
City Council / Board of Directors
Written Communications
Meeting of: June 20, 2023
Submitted By:

Jennifer Thompson, City Clerk

Subject:

City Wide Landscaping Beautification and Upkeep
Recommendation:

Any action is at the discretion of Your Honorable City Council.

Fiscal Impact:

There are no fiscal impacts associated with this item.

Background:

At the City Council meeting of June 6, 2023, it was moved by Mayor Jones and approved by a majority vote to agendize an item for discussion and possible action to determine if the Council wishes to take a position on City-wide landscape beautification and upkeep regardless of LMAD revenue deficiencies.

Discussion:

This item is being presented to Council so that Council can further discuss and determine if the Council wishes to take a position on City-wide landscape beautification and upkeep regardless of LMAD revenue deficiencies.

Staff remains available for any questions or comments you might have.

Attachments: None
Item Number: 23
City Council / Board of Directors
Written Communications
Meeting of: June 20, 2023
Submitted By:

Jennifer Thompson, City Clerk

Subject:

Removal of Member Blech and Neri from the Community Revitalization Investment Authority Board
Recommendation:

Any action is at the discretion of Your Honorable City Council.

Fiscal Impact:

There is no fiscal impact associated with this item.

Background:

At the City Council meeting of June 6, 2023, it was moved by Mayor Jones and approved by a majority vote to agendize an item for discussion and possible action for the removal of Member Blech and Neri from the Community Revitalization Investment Authority (CRIA) Board for unsatisfactory attendance and to further authorize the search for replacements.

Discussion:

This item is being presented to Council so that Council can further discuss the removal of Member Blech and Neri from the CRIA Board for unsatisfactory attendance and to further discuss the authorization to search for replacements.

Staff remains available for any questions or comments you might have.

Attachments: None