Institutional Federal Compliance Report 2021

STATE OF NEW YORK

Schedule of Findings and Questioned Costs

Year ended March 31, 2018

The Department performed risk assessment procedures prior to the start of the 2017–2018 school year and in specific circumstances when additional information was received over LEA building school designations and risk factors; however, the Department did not consider risk factors specific to the buildings for individual LEAs as described in 2 CFR 200.331 (b) to determine appropriate subrecipient monitoring procedures to perform and to ensure that subawards are used for authorized purposes in compliance with federal statutes, regulations, and the terms and conditions of the subaward and that subaward performance goals are achieved when planning their monitoring procedures. The Department utilized receivership New York Consolidated Laws, Education Law Section 211(f) to determine schools were either “nonreceivership” or “receivership” schools, and are further designated as “struggling” or “persistently struggling.” A “Nonreceivership” school is a designation used by the Department for schools, which are School Improvement grant funded but not in receivership. “Struggling” schools have been priority schools since the 2012–2013 school year and will be given two years under a “Superintendent Receiver” (i.e., the superintendent of schools of the school district vested with the powers a receiver would have under New York Consolidated Laws, Education Law §section 211(f)-f and section 100.19) to improve student performance. “Persistently struggling” schools are priority schools that have been in the most severe accountability status since the 2006–2007 school year. For schools that were considered to be “nonreceivership” schools, the Department did not perform any additional school-specific risk assessment related to compliance with federal awards. Instead, the Department required the schools to submit midyear progress reports, which included a detailed fiscal review with the goal being State Fiscal Year 2018 would be the “base line” year for the risk assessment process to be implemented starting with State Fiscal Year 2019. Additionally, the Department did not have documented risk assessment policies and procedures. “Receivership” schools, these schools were determined to be either “struggling” or “persistently struggling schools” based on School Improvement Grant New York Consolidated Laws, Education law 211(f). Each of the receivership school received between 2 and 4 “contacts” consisting of site visits and/or progress review phone conferences. Schools were required to submit quarterly progress reports to the Department. Additionally, “struggling” schools received one site visit during the year, and “persistently struggling” schools received one to two site visits. However, the Department’s school-specific risk assessment over these schools considered only the schools demonstrable improved indicators and no other risk factors consistent with 2 CFR 200.331(b); such as the subrecipient’s prior experience with the same or similar subawards; the results of previous audits, including whether or not the subrecipient receives a Single Audit and the extent to which the same or similar subaward has been audited as a major program; whether the subrecipient has new personnel or new or substantially changed systems, and the extent and results of Federal awarding agency monitoring. Lastly, the Department did not have a documented risk-based assessment policy and procedure manual. Cause The condition found is due to timing necessary to implement the Department’s corrective action plan from a prior year finding did not allow the Department to implement and utilize the updated risk assessment as part of its March 31, 2018 fiscal year; the design of controls in place over monitoring procedures, which only take into consideration the LEA school designation and does not consider factors present at each individual LEA receiving Federal funding for the purpose of determining appropriate subrecipient monitoring procedures.

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