06.18.19 Regular Meeting - Laserfiche WebLink

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City Council Meeting Minutes June 18, 2019 Kathie Schwerdtfeger and Sarah Lawrence with Deliotte and Touche LLP who presented the Community development Block Grant -Disaster Recovery (CDBG-DR) Quarterly Internal Audit Report. The City has engaged Deloitte & Touche LLP to conduct internal audits each year of program funds and activities to evaluate compliance with HUD CDBG-DR requirements as well as operating effectiveness of internal controls over program activities and funds. Their initial observations and recommendations were finalized and released to the City on June 3, 2019. The City has provided a formal management response and corrective action plan to each observation which we believe addresses each issue. In many cases, these changes are already underway by City Departments. They provided the following recommendations based on their observations: The City should create and integrate a Cost Reasonableness Analysis process into its purchasing activities and should maintain documentation and reconcile files adopting a single source electronic file system as the official file copy of procurement records. The Finance department should review all prior costs based on labor allocations to determine proper allocation and implement a process to confirm that expense documentation is on file for all applicable transactions. The City should update its policies to reflect current grant program specific processes and document a mitigating control in instances where multiple approval roles are the same person. Given the recent staff turnover and new positions in multiple Departments, as well as multiple areas in which grant requirement knowledge could be expanded, they recommend providing program -specific training to those staff members involved in CDBG-DR grant management activities. This training should be mandated for all new personnel and annual updates provided to those working with the program. CONSENT AGENDA A motion was made by Council Member Rockeymoore, seconded by Council Member Derrick, to approve the consent agenda, items # 2 - 21. Council Member Mihalkanin abstained from a vote on item #10 to avoid the appearance of impropriety as he is an employee of Texas State. The motion carried by the following vote: For: 7 - Mayor Pro Tem Prewitt, Council Member Gonzales, Council Member Derrick, Mayor Hughson, Council Member Mihalkanin, Council Member Marquez and Council Member Rockeymoore City of San Marcos Page 5