Claremont School Board — September 7, 2022

MEDIUM The business administrator reported that the audits for fiscal 2020, which ended in June 2020, were still being finished, with the federal single audit back on schedule only from fiscal 2022

At 0:36:47 Seaman reported receiving that day "the draft of the unity 2020 audit", said the SAU's would follow shortly, and that the district was "working our way down through 2020 Claremont." The goal he set was "being back where the district should always have been. With our audits completed by February, and most importantly, the submittal of the single audit done by the March 15th deadline, which is a federal requirement" (0:37:14). On August 24 he had put fiscal 2021 in November 2022 and fiscal 2022 "by February" (August 24 page); on September 29 the auditor asked to move Claremont's fiscal 2020 audit to the end of October (September 29 page).

The rule. A non-federal entity "that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single or program-specific audit conducted for that year" (2 CFR 200.501(a)), and the audit must be completed and submitted "within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period" (2 CFR 200.512(a)(1)). Seaman described about "$3 million of grants" a year (0:45:12) and called the single audit "a federal requirement". For a fiscal year ending June 30, 2020, nine months ran to March 31, 2021; for fiscal 2021, to March 31, 2022. The Office of Management and Budget allowed temporary COVID-era extensions for fiscal years ending through June 30, 2021; this page has not read those memoranda and states no extended date, but none it has seen described approaches September 2022 for fiscal 2020.

Severity. MEDIUM, not HIGH, because two facts the deadline depends on are not on this record. First, whether the district was subject to a single audit for fiscal 2020: the "$3 million of grants" Seaman mentioned was a figure for the budget then being built, not stated as federal and not stated as fiscal 2020 expenditures, so the recording does not itself show the $750,000 threshold was crossed that year. Second, whether an OMB COVID-era extension applied. What the record does establish is that the officer responsible stated that audits for a fiscal year that closed more than two years earlier were unfinished, and that the district would be current only with fiscal 2022. Mitigation, stated on the same record: the backlog predates the current administration ("where the district should always have been"), a written catch-up schedule exists, two grant-compliance matters had been cleared by the Department of Education (August 24), and the fiscal 2022 target of February 2023 falls inside the federal deadline. State law sets no competing deadline this page relies on (RSA 21-J:19 is permissive as to timing). The Federal Audit Clearinghouse was not checked for this page.

Sources: 2 CFR 200.501(a) (2022 edition; $750,000 threshold); 2 CFR 200.512(a)(1) (2022 edition; nine months after the end of the audit period).

MEDIUM $828,000 of Claremont grant money was unspent or unreimbursed three weeks before it began to lapse, and the business administrator called the district's grant process a longstanding failure

Seaman's written summary and remarks at 0:37:44 to 0:40:49: "$828,000 that has not been spent or has not been reimbursed", of which "$764,000 of those grants that, as of yet, are not in a position that we can be reimbursed"; Title I could carry over, but for Titles II, IV and V "If we don't spend it, those we lose". Asked why, he said allocations should be "identified, submitted to the state and approved by the end of August at the latest", and "That has not been going on in the past for those that have been managing our title money." To Sprague at 0:48:08: "Apparently, we have found over the years many ways not to have it done"; at 0:48:56: "It was not a good process. It has not been a good process." The literacy specialist explained why late money could not simply be moved: "You can't spend money. That was supposed to be for the past school years." Federal education formula funds not obligated in their first year remain available for one additional fiscal year and then lapse, which is the September 30 cliff described.

Why MEDIUM: 2 CFR 200.303(a) requires a recipient to "Establish and maintain effective internal control over the Federal award". A finance officer's account of a multi-year failure to allocate and claim formula grants on time describes a control weakness, not only a timing problem. Mitigation: the pandemic delayed activities (Hurst, Horsky), the new curriculum team and a written procedure were in place for 2022-23, and on September 29 Seaman reported that Claremont had used all but about $10,000 of its Title II, III and IV funds within the deadline (September 29 page). On October 19 staff confirmed that some Title money had lapsed, without a figure (October 19 page).

Sources: 2 CFR 200.303(a) (2022 edition; internal control over federal awards); 20 U.S.C. §1225(b) (one additional fiscal year of availability).

MEDIUM The minutes omit the seconders of both policy motions, name the wrong seconder for adjournment, and misstate who opened the meeting and when

RSA 91-A:2, II (in this form since 2018, 244:1, eff. January 1, 2019) requires that "The names of the members who made or seconded each motion shall be recorded in the minutes." On tape JICD was moved by Sprague and seconded by Whitney (0:35:03, 0:35:08) and JICK moved by Sprague and seconded by Lambert (0:35:32, 0:35:36); the minutes merge them into one line, "Motion made by Frank Sprague to move policy JICD & JICK to 'second read' ; all in favor via voice vote", with no seconder. Adjournment was seconded by Sprague on tape (1:41:55); the minutes read "seconded by Heather Whitney". The minutes also open with "Meeting called to order by Vice Chair Heather Whitney 6:30pm", which is the wording of the August 24 minutes: tonight the chair called the meeting to order (0:00:29) after a 6:30 non-meeting, and the agenda set the board meeting for 7:00. The chair's abstention on the August 24 minutes (0:02:33) appears as "all in favor via voice vote". The board approved these minutes on September 21 without correction.

The minutes first appear in the district's public Drive share on September 23, 2022, in the September 21 packet folder: the twelfth business day after the meeting, and after their approval. RSA 91-A:2, II requires minutes to be "open to public inspection not more than 5 business days after the meeting"; a Drive created time dates online posting, not availability at the SAU office, so that part is an observation. MEDIUM because two recorded votes on district policy lack the seconder the statute requires; the other defects are accuracy errors the approval did not catch.

Sources: RSA 91-A:2, II (2022 codification: movers and seconders; five business days); CSB minutes 9.7.22 final.docx.pdf.