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CITY OF BANGOR,MAINE
� t Auditin Standards
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Reports Required by g
and OMB Circular A-133 F
� � June 30,2002
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A N D B U S I N E S S C O N S U LTA N T S
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CITY OF BANGOR,MAINE
Reports Required by Government Auditing Standards
' and OMB Circular A-133
June 30, 2002 - �
Report Paee
Report on Compliance and on Internal Control over Financial Reporting Based on an Audit of
Financial Statements Performed in Accordance with Government Auditing Standards 1-2
Report on Compliance with Requirements Applicable to Each Major Program and Internal Control
Over Compliance in Accordance with OMB Circular A-133 3-4
Report on Compliance with Requirements Applicable to the Passenger Facility Charge Program,
Internal Control over Compliance and Schedule of Expenditures of Passenger Facility Charges 5-6
Schedule of Expenditures of Federal Awards � 7-g
Schedule of Expenditures of Passeriger Facility Charges 9
Notes to Schedule of Expenditures of Federal Awards 10
Schedule of Findings and Questioned Costs:
Section I- Summary of Auditor's Results 11
Section II-Findings Required to be Reported Under Government Auditing Standards 12
Section III-Findings and Questioned Costs for Federal Awards 13
.�
f�Lt 1�L i�0 Yt- ,,,.�,:��
`K.ersteevc -�-�-��
Oj�1 ellette � , Certified Public Accountants and Business Consultants
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL �
REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
City Council
City of Bangor, Maine �
We have audited the general purpose financial statements of the City of Bangor as of and for the year
ended June 30, 2002, and have issued our report thereon dated October 10, 2002. We conducted our
audit in accordance with auditing standards generally accepted in the United States�of America and the .
standards applicable to financial audits contained in Governnzent Auditzng Standards, issued by the _
Comptroller General of the United States.
Compliance
As part of obtaining reasonable assuranoe about whether the City of Bangor's�nancial statements are
free of material misstatement, we performed tests of its compliance with certain provisions of laws,
regulations, contracts, and grants,noncompliance with which could have a direct and material effect on
the determination of financial statement amounts. 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 noricompliance that are required to be reported under .
Governme�at Auditing Standar•ds.
Internal Control Over Financial Reportin� �
In planning and performing our audit,we considered the City's internal control over financial reporting
in order to determine our auditing procedures for the purpose of expressing our opinion on the financia]
statements and not to provide assurance on the internal control over financial reporting. However, we
noted a matter involving the internal control over financial reporting and its operation that we consider to
be a reportable condition. Reportable conditions involve matters coming to our attention relating to
significant deficiencies in the design or operation of the internal control over financial reporting that, in
our judgment, could adversely affect the City of Bangor's ability to record,process, summarize, and .
report financial data consistent with.the assertions of management in the financial statements. A � .
reportable condition is described in the accompanying schedule of findings and questioned costs as item
#2002-1.
A material weakness is a condition in which the design or o�eration of one or more of the internal
control components does.not reduce to a relatively low level the risk that misstatements in amounts that
v✓ould be material in relation to the financial statements being audited may occur and not be detected .
within a timely period by employees in the normal course of performing their assigned functions. Our
consideration of the internal control over financial reporting would not necessarily disclose all matters in
the internal control tliat might be reportable conditions and, accordingly, would not necessarily disclose
1 ,
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL
REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS, CONTINUED
all reportable conditions that are also considered to be material weaknesses. However,we believe the
reportable condition described above is not a material weakness.
We noted other matters involving the internal control over financial reporting that we have reported to
the management of the City in a separate letter dated October 10, 2002.
This report is intended for the information of the City Council, School Board,management and federal
awarding agencies(including the Federal Aviation Administration) and pass-through entities and is not
intended to be and should not be used by anyone other than these specific parties.
���.� �
October 10, 2002
South Portland,Maine
2
.w\l`
J�Y����� „i.�l� .
?�ersteev� �--
D�ilettette . Certified PublicAccountants and Business Consultants
REPORT ON COMPLIANCE WITA REQUIREMENTS APPLICABLE TO EACH �
MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN
ACCOR.DANCE WTTH OMB CIRCULAR A-133
� City Council
City of Bangor,Maine
Compliance
We have audited the compliance of the City of Bangor with the types of compliance requirements
described in the U. S. Office of Management and Budget(OMB) Circular A-133 Compliance
Supplement that are applicable to each of its major federal programs for the year ended June 30,2002. -
The City of Bangor's major federal programs are identified in the summary of auditor's results section of �
the accompanying schedule of findings and questioned costs. Compliance with the requirements of laws,
regulations,contracts, and grants applicable to each of its major federal programs is the responsibility of
the City of Bangor's management. Our responsibility is to express an opinion on the City of Bangor's
compliance based on our audit. . � • .
We conducted our audit of compliance in accordance with auditing standards generally accepted in the
United States of America; the standards applicable to financial audits contained in Government Auditing �,
Standards, issued by the Comptroller General of the United States; and OMB Circular A-133,Audits of
States,Local Goyernments, and Non-profit Organizations. Those standards and OMB Circular A-133
require that we plan and perform the audit to obtain reasonable assurance about whether rioncompliance
with the types of compliance requirements referred to above that could have a direct and material effect
on a major federal program occurred. An audit includes examining, on a test basis,evidence about the ,
City of Bangor's compliance with those requirements and performing such other proeedures as we
considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our
opinion. Our audit does not provide a legal determination on the City of Bangor's compliance with those
requirements.
As described in item#2002-2 in the accompanying schedule of findings and questioned costs,the City of
Bangor did not comply with requirements regarding the Davis-Bacon Act as applicable to its U.S.
Department of Transportation, Airport Improvement Plan(CFDA#20.106)program. Compliance with
such requirement is necessary, in our opinion, for the City of Bangor to comply with requirements
applicable to that program.
In our opinion, except for the noncompliance described in the preceding paragraph,the City of Bangor
complied,in all material respects,with the requirements referred to above that are applicable to each of
its major federal programs for the year ended June 30, 2002.
3
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH
MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN
ACCORDANCE WITH OMB CIRCULAR A-133, CONTINUED
Internal Control Over Compliance
The management of the City of Bangor is responsible for establishing and maintaining effective internal
control over compliance with requirements of laws,regulations, contracts, and grants applicable to
federal programs. In planning and performing our audit, we considered the City's internal control over
compliance with requirements that could have a direct and material effect on a major federal program in
order to determine our auditing procedures for the purpose of expressing our opinion on compliance and
to test and report on internal control over compliance in accordance with OMB Circular A-133.
Our consideration of the internal control over compliance would not necessarily disclose all matters in
internal control that might be material weaknesses. A material weakness is a condition in which the
� design or operation of one or more of the intemal control components does not reduce to a relatively low
level the risk that noncompliance with applicable requirements of laws,regulations,.contracts;and grants
that would be material in relation to a major federal program being audited may occur and not be
detected within a timely period by employees in the normal course of performing their assigned
functions. We noted no matters involving the internal control over compliance and its operation that we
consider to be material weaknesses:
Schedule of Expenditures of Federal Awards
We have audited the general purpose financial statements of the City of Bangor as of and for the year
ended June 30, 2002, and have issued our report thereon dated October 10, 2002. Our audit was
performed for the purpose of forming an opinion on the financial statements taken as a whole. The
accompanying schedule of expenditures of federal awards is preserited for purposes of additional
analysis as required by OMB Circular A-133 and is not a required part of the�nancial statements. Such
information has been subjected to the auditing procedures applied in the audit of the general purpose
financial statements and, in our opinion, is fairly stated, in all material respects, in relation to the general
purpose financial statements taken as a whole.
This report is intended for the information of the City Council, School Board,management and federal
awarding agencies and pass-through entities and is not intended to be and should not be used by anyone
other than these specific parties.
D
October 10, 2002
South Portland, Maine .
4
�:�
j�u v�.�ovi -�.-��--- .
xersteev� ��--
- d'ti�e�����e Certified Public Accountants and Business Consultants •
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO TAE PASSENGER
FACILITY CHARGE PROGRAM,INTERNAL CONTROL OVER COMPLIANCE AND
SCHEDULE OF EXPENDITURES OF PASSENGER FACILITY CHARGES �
City Council
City of Bangor,Maine �
Compliance
We have audited the compliance of the City of Bangor with the compliance requirements described in
the Passenger Facility Charge Audit Guide for Public Agencies, issued by the Federal Aviation
Administration(Guide), for its passenger facility charge program for the year ended June 30, 2002. .
� Compliance with the requirements of]aws and regulations applicable to its passenger facility charge '
program is the responsibility of the City of Bangor's management. Our responsibility is to express an
opinion on the City of Bangor's compliance based on our audit.
We conducted our audit of compliance in accordance with auditing standards generally accepted in the
United States of America; the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States; and the Guide. Those standards and
the Guide require that we plan and perform the audit to obtain reasonable assurance about whether
noncompliance with the compliance requirements referred to above that could have a direct and material
effect on the passenger facility charge program occurred. An audit includes examining, on a test basis,
evidence about the City of Bangor's compliance with those requirements and performing such other
procedures as we considered necessary in the circumstances. We believe that our audit provides a
reasonable basis for our opinion. Our audit does not provide a legal determination of the City of
Bangor's compliance with those requirements.
In our opinion,the City of Bangor complied,in all material respects, with the requirements refened to
above that are applicable to its passenger facility charge program for the year ended June 30, 2002.
�nternal Contxol Over Compliance
The management of the City of Bangor is responsible for establishing and maintaining effective internal
control over compliance with the requirements of laws and regulations applicable to the passenger
facility charge program. In planning and performing our audit, we considered.the City of Bangor's �
. internal control over compliance with requirements that could have a direct and material effect on the
passenger facility charge program in order to determine our auditing procedures for the purpose of . . .
expressing our opinion on compliance and to test and report on the internal control over compliance in
accordance with the Guide.
5
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO THE PASSENGER
FACILITY CHARGE PROGRAM,INTERNAL CONTROL OVER COMPLIANCE AND
SCHEDULE OF EXPENDITURES OF PASSENGER FACILITY CHARGES, CONTINUED
Our consideration of the internal control over compliance would not necessarily disclose all matters in
the internal control that might be material weaknesses. A material weakness is a condition in which the
design or operation of one or more of the internal control components does not reduce to a relatively low
level the risk that noncompliance with applicable requirements of laws and regulations that would be
material in relation to the passenger facility charge program being audited may occur and not be detected
within a timely period by employees in the normal course of performing their assigned functions. We
noted no matters involving the internal control over compliance and its operation that we consider to be
material weaknesses.
Schedule of Expenditures of Passenger Facility Charges
� We have audited the general purpose financial statements of the City of Bangor as of and for the year
ended June 30, 2002, and have issued our report thereon dated October 10, 2002. Our audit was
performed for the purpose of forming an opinion on the general purpose financial statements takeri as a
whole. The accompanying schedule of expenditures of passenger facility charges is presented for
purposes of additional analysis as specified in the Guide and is not a required part of the general purpose
financial statements. Such information has been subjected to the auditing procedures applied in the audit
of the general purpose financial statements and, in our opinion, is fairly stated, in all material respects, in
relation to the general purpose financial statements taken as a whole.
This report is intended solely for the information and use of the City Council,management, and the
Federal Aviation Administration and is not intended to be and should not be used by anyone other than
these specified parties. �
�.�e^�Y� �
October 10, 2002 ,
South Portland,Maine
6
' JF BANGOR,D +
Schedule of Expenditures of Federal A�vards
For}'ear ended June 30,2002
' Pass-
Federal through/
CFDA Award grentor Beginning Re�enue Ending
Federai A�rerds number amount number balance Federal Slete Olher Expenditures balance
Reccired DirecU��
Depariment of Housing and W'ban DevelopmenC
Community Deveiopment Block Gnnts: . ' -
B-00-MG23-0004 14.218 1,270,000 N/A (179.419) - 182,367 - 2,948. - ..
B-01-MG23-0004 14.2I8 1,264,000 N!A - 818.215 460,222 - 1.278,437 ' -
. � Sapportive Housing:� . • 2 . .
ME OGB97-0201(8711) 14.235 348,581 N/A - 74,659 - - 74,659 -
ME 06B9G-0105(8718) 14.235 63,000 N/A � - 18364 - - 18,364 -
ME 06B96-OI06(8719) 14.235 395,000 N/A - 64,988 ' - - 64,988 -
-. . . . Shelter Plus Care: ' . . " . . . . . � .
ME 06C93-I135 TRA " 14.238 740.160 N/A -. 81.859 - - 81,859 -
ME 06C93-i 135 PRA 14.238 558,000 N/A - 10,720 - - 10.720 -
ME OIC90-1004 TRA IA•238 11G,052 N/A - 30,661 • - 30,66� -
ME OIC90-1002 TRA 14.238 804,540 N/A - 88,976 - - • 88,976 -
MEOIC90-1007PRA 14.238 52,512 N/A - 19,436 - 19,436
Total Depatiment o(Housing and Urban Dcvelooment (179,419) 1,0G8,805 642,589 - t.67 t,048 -
Departmenl oUustice: .
CopsFast 16.710 592,276 95C�VX3679 - 113,786 - 37,928 l51.714 -
Local I.aw Enforcemenl Block Grant 16.592 31,490 2001-LB-SX-2933 - 31,490. • 3.499 20,O19 l4,970
L.ocall.��w Enforcement Block Grant 16.592 26,087 2000-LE3-BX-1854 4,860 (2,899) - , (322) 1.639 -
LocalLaw En(orcement Blxk Grant 16.592 29,623 2000-LB-VX-0413 4.766 (3,292) - (3G5) 1,109 -
, Juvenile Acco�m�ability)ncentive Block Grant 16.523. 56,017 96012 - 56,017 - 9,395 65,412 -
Juveniie Accoumability Incentive Block Grant 16.523 41,980 G202263 - 32,438__ 2,425 32,290 2,573
Total Department of Justice 9,626 227,540 -___ 52,560 272,183 17,543
� Department of Transportation:. . - . � � �� � �
Airpoit lmprovemen�Plan:
3-23-0005-27 20.106 1,793,754 N/A - 28.483 - 4;160 32,643 . -
3-23-0005-28 20J06 1,278,850 N/A - 2,119 1,167 - 3,286 -
3-23-0005-29 20J06 t.307,992 N/A - 1.081,067 60,059 �4,628 1,155,754 -
. 3-23-0005-30 20.106 28I,880 N/A (1,838) 178,938 9,941 130,372 317,413 -
3-23-0005-31 20.106 2,300,000 N/A . - 685370 38,076 552,343 1.275,789 -
3-23-0005-32 20.106 135,757 N/A - 67.701 - - 67.701 -
7otal Departmen[ofTransportation (1,838) 2,043,678 109,243 701,503 2,852,586 -
, Environmental Protec�ion Agency Special Pmpose 66 606 6,000,000 N/A 1,208,174 988.506_ 2,196,680
Pass Throueh -.
. � � Deparlment o(Agriculture,passed through Maine DepmYment o( . � � � � . - -
� Human Services: . �- . � � � - . - � . . �. � -
Women,In(ant and Children-Admin: .
WIC 02-01 . 10.557 364.034 N/A - 122.167 - - 122,167 -
WIC 02-02 10.557 399.898 N/A - 272,365 - - 272.365 -
WomenJn(nnt and Chitdren-Food:
WIC 02-Ot 10.557 N!A N/A 414.681 - - 414,68I -
WIC 02-02 10.557 1,586,G86 N/A - '895,947 - - 895,947 -
Passed throagh Maine Department oF Education:
Food Disvibuuon-Food Donation Progam I0.550 N/A OI3-6134-OS 16,598 37,222 - - 53,820 -
` School Break(astProgram 10.553 N/A 013-7127-OS - 56,104 • - 56,104 -
School Lunch Progr.vn. 10.595 N/A 013-7128-05 - 396,194 - - 396,194 - ,
SammerFoodRogram 10.559 N/A 013-7130-OS - 8,099 ___ - 8,099
Tot�l Deparvnent of Agriculrore 16,598 2,202,779 - - 2,2I9,377 -
7
�
CITY OE 6ANGOR,D9AINE '
Schedule of Expenditures of Federal A�vards,Continued
� For year ended June 30,2002
Pass-
. Federal througl✓ .
CFDA A���ard grantor Beginning Revenue Ending
Federel Awards number �amount . number balance Eederal State Other Expenditures balance
Pass Throueh.Continued �
Department of Health&Human Services,passed through
Bureau of Health:
Bangor Children's Dental CGnic 93.994 I6,000 BH 02-28 - 16,000 - . IS0,378 196,378 -
HIV Prevention&Education .. 93.]18 1Q646 SH 01-38 761 5,323 - - 9,143 (3,059)
H1V Prevention&Education , 93.1 18 10,646 . BH 02=86 - 5,323 - - 1,875 3,448 •
STD/HIV Clinical and Epidemiologic Services , 93.977 1 IQ900 BH 01-31 (7,787) 48,157 - 17,188 59,353 Q,795)
STD/HIV Clinical and Epidenuologic Services 93.977 - 96,314 BH 02-86 - 48,157 - 20,576 61,238 7,495
Immm�ization Program Nursing 93.268 10,000 BH O1-228 (1,864) 7>500 - 21,272 39,775 (12,867)
Immunization Program Nursing 93.268 (0,000 BH 02J33 - 2,500 - 15,832 34,383 Q6,051)
Department of Health&Human Services,passed through
the Maine Department of Education:
HIV/AIDS Prevenuon Ed Grant 93.938 013-OSA-3169-IS 1,384 - - 1,384
Total Department of Healdi&Human Services (7,506) 132,960 255,246 402,145 (21,445)
Department of Educauon,passed through lhe b9aine Department
of Education: '
Adult Basic Education 84.0p2 45,883 013-OSA-6297-642 45,883 - - 45,883 -
AdultBasic Educa[ion 84.002 19,350 013-OSA•6296-642 - 19,350 - 19,350 -
Title lA 84.010 854,620 013-OSA-6334-132 111,154 854,620 - - 932,658. 33,116
TiUe IC 84.011 58,264 013-OSA-7151-132 18,757 58,264 - - 60,103 16,918
Tide VI 84.298 32,631 015-OSA-5063-662 7,SI0 32,681 - - . 32,147 8,044
Eisenhower Elementary and Secondary 84.281 38,820 013-OSA-8091-102 7,067 38,820 - - 23,850 22,037
Special Ed Local Entidement Tide VA EHA 84.027 496.074 013-OSA-6317-(22 8,636 496,074 - - 492,673 12,032
Impacted Aid-Tide V11 84.041 21,210 N!A - 21,210 - - - 2J,2I0 -
Classroom Reduction . 84340 205,997 0l3-OSA-5088-602 - 205,997 - - 205,997 -
Preschool L,ocal Entidement 84.173 28,377 013-OSA-6241-023 14,282 12,258 - - 26,540 -
Passed[hrough the Maine Department of Substance Abuse:
Drog Free Schools and Commm�iues 84.086 27,162 N/A 4,953 27,162 - 15,233 I6,912
Total Departmentof Educalion 172,389 1,812,3I9 - 1,875,649 109,059
Urban Mass Transportation Assistance,passed Ihrough Maine. '
DepartmentofTransponauon:
Opera6ng 20.507 277,414 ME-90-X130 , - 277,414 48,287 584,442 910,143 -
RTAP 20.509 3,350 ME-18-X-027 - t,712 - - 1,712 -
RTAP 20.509 1,500 D1E-IS-X-023 - 235 - - 235 -
RTAP 20.509 2,100 ME-18-X-030 - 793 - 793 -
Total Urban Mass Transportauon Assistance - 280,154 4$,287 584,442 912,883
Total Federal A���ards $ 9,850 8,976,409 SOO,ll9 2,582,257 ]2,402,551 105,157
8 .
' CITY OF BANGOR,MA[NE •
. , • Schedule of Expenditures of Passenger Facility Charges -
• For Year ended June 30,2002 -
' Memorandum Memorandum
_ . �Only Only •
Cumulative Cumulative
• � , Approved Amodnts Total Year Ended Total
Impose and Use June 30,2001 June 30,2002 June 30,2002
95-01-C-00-BGR(as amended) •
Passenger facility charge revenue and interest � 8,9G1,006 , 3,432,486 �541,689 � 3�,974,175
Expenditures: '
Reconstruct Domestic Terniinal Ramp,
reconstruct International Ramps(North and South),
reconstruct Ramp Movement Areas,and �
reconstr�ct and Expand Commuter Apron Area
Total expenditures � 8,961,006 2,301,672 . 838,088 3,139,760
9 : ' .
CITY OF BANGOR,MAINE
Notes to Schedule of Expenditures of Federal Awards
June 30, 2002
PURPOSE OF THE SCHEDULE
Office of Management and Budget(OMB) Circular A-133, Audits of States,Loca] Governments and Non-profit
Or,ganizations,requires a Schedule of Expenditures of Federal Awards showing total expenditures for each ,
, federal award program as identified in the Catalog of Federal Domestic Assistance(CFDA).
SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity-The accompanying schedule includes all federal award programs of the City of Bangor
for the fiscal year ended June 30, 2002. The reporting entity is defined in Notes to Financial,Statements of
the City of Bangor.
B. Basis of Presentation -The information in the accompanying Schedule of Expenditures of�'ederal Awards
is presented in accordance with OMB Circular A-133.
1. Pursuant to OMB Circular A-133, federal awards are defined as assistance provided by a federal
agency, either directly or indirectly,in the form of grants, contracts, cooperative agreements, loans, loan
guarantees,property, interest subsidies, insurance or direct appropriations.
2. Major- OMB Circular A-133 establishes the level of expenditures or expenses to be used in defining
major federal award programs. Major programs for the City of Bangor are identified in the summary of
auditor's results in the Schedule of Findings and Questioned Costs.
C. Basis of Accounting- The information presented in the Schedule of Expenditures of Federal Awards is
presented on the modified accrual basis of accounting, which is consistent with the reporting in the City's
financial statements.
CITY OF BANGOR;MAINE �
Schedule of Findings and Questioned Costs
June 30,2002
Section I-Summary of Auditor's Results
Fina�icial Statements � �
Type of auditor's report issued: Unquali�ed
Internal control over financial reporting:
Material weaknesses identified? no
Reportable conditions identified �
not considered to be a material weakness? yes .
Noncompliance material to financial statements noted? no
Federal Awards �
Internal Control over major programs:
Material weaknesses identified? no
Reportable conditions identified ,
not considered to be material weaknesses? no
Type of auditor's report issued on compliance
for major programs: Qualified
Any audit findings disclosed that are required
to be reported in accordance with
Circular A-133, Section .510(a)? yes
Identification of major programs:
CFDA Numbers Name of Federal Program or Cluster
10.557 WIC-Nutrition Program
20.507 MDOT-Capital and Operating Assistance
20.106 Airport Improvement Plan
84.010 Title lA
84.027 Specia] Education-Grants to States
Dollar threshold used to distinguish
between Type A and Type B programs: $372,077.
Auditee qualified as low-risk auditee? No
11
CITY OF BANGOR,MAINE
Schedule of Findings and Questioned Costs,Continued
Section II-Findings Required to be Reported Under Gover.nment Auditing Standards �
�#2002- 1 - Sewer S,ystem Controls
Controls at the sewer utility are potentially weakened because�of the utility's relationship with the Bangor Water
District,which is a separate,non-City entity. The problem arises because the water and sewer utilities share
many aspects of billing and collection. Specifically, sewer bills are based upon water usage data, as provided by
the water disficts; water and sewer bills are mailed together; sewer payments may be made at,among other
places, the water district; and the water districYs billing and payment software, which is incompatible with the
City's general accounting software, is also employed by the sewer utility.
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As a result, a number of problems arise. First;where payments are made at the water district, City funds remain
outside the City control for the period of time between their receipt from customers and the forwarding of
payment to the City. T'his,combined with the increased handling of the City assets introduces the�potential for
diversion of City property by non-City employees. Second, the flow of funds between the two util.ities and their .
timing often results in the"floaY'of relatively large amounts due the City. Third, the incompatibiiity of systems
between the sewer utility and the rest of City government makes timely tracking of,sewer utility performance
difficult. Further, it makes reconcilement increasingly important and time consuming.
We recommend the City review its relationship with the water utility to correct these cash handling and
accounting deficiencies.
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CITY OF BANGOR,MAINE
Schedule of Findings and Questioned Costs,Continued
Section III-Findings and Questioned Costs For Federal Awards �
#2002 -2 -U S Department of Trans�ortation, Airport Im�rovement Plan CFDA#20 106, for the period
July 1,2001 through June 30,2002.
Finding—Certain employees were not paid prevailing wage rates as required by the Davis-Bacon Act.
Criteria—All laborers and mechanics employed by contractors or subcontractors to work on construction
contracts in excess of$2,000 financed by federal assistance funds must be paid wages not less than those
established for the locality of the project(prevailing wage rates)by the Department of Labor.
Effect—Employees who were not paid prevailing wage rates will need to be contacted and paid the difference
between what they.were paid and the prevailing wage rate.
Recommendation—City officials need to ensure that the outside engineering firm is performing their tasks
related to the Davis-Bacon Act. These tasks include informing contractors and subcontractors of the
requirements of the Act and also verification of payments at prevailing wages.
Questioned Costs -None.
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SOUTH PORTLAND AUGUSTA WATERVILLE
20 Long Creek Drive 189 Water Street 30 Elm Street
South Portland ME 04106 Augusta ME 04330 Waterville ME 04901
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