Change to state requirement may make San Benito County ineligible to receive funding
Change to state requirement may make San Benito County ineligible to receive funding
San Benito County’s application for a community development block grant to fund the Emmaus House domestic violence shelter, the county emergency homeless shelter and local job training programs may be ineligible due to a change in a state requirement that apparently was not communicated clearly to the auditor’s office.
Joe Paul Gonzalez, the county’s auditor, received word this week that the county’s application would not be considered by the department of Housing and Urban Development because the state controller’s office did not receive the county’s audit report on time.
Kathy Flores, the director of Health and Human Services which oversees the Community Services and Workforce Development department that completed the application, asked the supervisors to add an emergency agenda item to dispute the finding by HUD.
“We were informed that the requirement for a single audit was not met and they said they would not consider the item,” Flores said.
The application called for $100,000 to operate the homeless emergency winter shelter; $200,000 for job training services at Community Services and Workforce Development; $162,500 to operate Emmaus House, a shelter for victims of domestic violence; and $37,500 for administration funds.
Gonzalez and Flores contended that the county had submitted the audit by the deadline of April 6 – they submitted it to the federal clearinghouse as required every year. This year is the first year that the federal grant that is administered through the state required that an audit also be sent to the state controller’s office by April 6. Flores said she believed the federal agency forwards the audit to the state, but because Gonzalez submitted it at the end of March it had not yet been sent on.
“HUD is holding firm, but we believe they are in error,” Flores said.
Of 96 agencies that submitted applications for the CDBG grant, 16 of them were disqualified for not having an audit to the state controller’s office by April 6.
“This is the first time that was a requirement,” Flores said.
Flores asked that the item be added on the agenda for the Tuesday meeting as they wanted to have the board of supervisors approve a letter to request that the application be reconsidered. They wanted to get the letter sent before HUD sent an official letter denying the application, hence the urgency to get the matter on the agenda. The board of supervisors in Siskiyou County – another small county in the same predicament as San Benito – were set to approve a similar letter.
The supervisors approved the emergency agenda item and continued the discussion just before the end of the board meeting.
Gonzalez said that the new reporting requirement was not clear to him.
“There has never been a date when it had to be submitted,” he said. “The county has nine months from the close of the fiscal year to file its audit with the federal clearinghouse, which it did. “I asked amongst my peers and they said there was not info on the new requirement.”
Supervisor Jerry Muenzer asked how it was that San Benito County did not meet the requirement when 80 other agencies were able to fulfill it. Gonzalez explained that other agencies with more staff or funding for outside consultants are often able to file their audits much earlier than he has been able to do in recent years.
“We do provide the audit to the state controller’s,” he said. “But other agencies such as Los Angeles, San Diego and other large organizations have a tremendous amount of resources. … Normally I try my best to get the books closed and completed by Dec. 31 but it is becoming increasingly difficult to meet that deadline.”
He also said that although HUD held training sessions on the new requirements, it did not include auditors and CPA staff members who are the ones required to submit the audit documentation. Flores also noted that the application packet included a copy of the audit.
“It is very unfair how our county could be hurt by this,” Gonzalez said.
In addition to having the supervisors sign a letter requesting that the application be considered, Gonzalez asked that the board of supervisors and staff members pursue a meeting with Congressman Sam Farr, since the funding comes from the federal government, as well as state representatives.
“This is an issue of a federal grant coming though a state system and we need to not take no for an answer,” Gonzalez said.
Supervisors Jaime De La Cruz and Margie Barrios agreed to be involved with the meetings.
“The deputy director (of state housing) said of the 80 applications that are eligible, only 40 to 45 will be receiving a grant,” Gonzalez said. “This is really about weeding out applications. But San Benito should be in the running.”
