Submittal to the Board of Sufervisors County of Riverside, State of California Item: 3.10

The civil Grand Jury found no evidence that any actions taken by Riverside County employees in the administration of the grants in question constituted malfeasance or misconduct, Response to Grand Jury Finding #'l: Respondent agrees with finding Housing and Workforce Solutions (HWS) leadership and staff perform their duties in alignment with the County of Riverside Code of Ethics as described in Board Policy C- 35 (attached). This has been communicated to staff by HWS leadership, who are continuing to demonstrate adherence to policy when working with grants and subrecipients. Grand Jury Finding #2:

There were previous issues with claims filed by the same subrecipient that could have prompted an earlier investigation into the documentation. Response to Grand Jury Finding #2: Respondent disagrees partially with the finding The Federal Department of Housing and Urban Development (HUD) has provided HWS with access to a specialized consulting firm, free of charge, to perform a full assessment of our current business process for grant subrecipient contracts, administration, and claims processing. HUD Office of Technical Assistance (OTA) provides the opportunity for all grant subrecipients to request professional guidance and support free of charge, which is provided by HUD in the form of consulting hours with firms they engage htt s://www.hud user. OV rtal/ota/home a e.html The subrecipient must submit a request to HUD OTA with details regarding the request for assistance. lf the request is approved, HUD will assign a consulting firm to provide up to 36 hours of initial support. lf the initial 36 hours of support are not sufficient to resolve the situation that prompted the request, the consultant can petition for an extension of time in order to adequately serve the subrecipient. For HWS's approved request, the assigned consulting firm is ICF (https://vwvw.icf.com/companv/about). This technical assistance project is still within the initial 36-hour allotment of consulting time, and the consultant has indicated clearly they will be requesting an extension for this project. ICF has already started reviewing HWS's current procedures, forms, and documentation, noting that the system in place is already more detailed and robust than most others they have reviewed. While concerns were noted earlier, the HWS team took action as soon as a pattern was established and evidence was available. Grand Jury Finding #3:

Claim reviewers expressed documentation concerns to their supervisors, yet the claims were paid. Response to Grand Jury Finding #3: Respondent agrees with finding Concerns were expressed by staff to management during claims reviews, and management followed up with those concerns by conferring with the HWS HUD representative for guidance as well as following up with the subrecipient to gain additional information and understanding about their program operations. ln order to avoid unnecessary impact to the participants whose rents were being paid by this program, claims payments were processed until a pattern was established and evidence was conclusive. Grand Jury Finding #4: F4 HWS experienced political pressure from both Federal and state governments to settle marginal claims, particularly during and immediately following the COVID-19 pandemic. Response lo Grand Jury Finding #4: Respondent disagrees wholly with finding HWS followed guidance from granting entities while still following appropriate protocols in the review of claims. Grand Jury Finding #5:

HWS experienced political pressure from both Federal and state governments to settle marginal claims, particularly during and immediately following the COVID-19 pandemic. Response lo Grand Jury Finding #4: Respondent disagrees wholly with finding HWS followed guidance from granting entities while still following appropriate protocols in the review of claims. Grand Jury Finding #5: F-5 lssues that were not apparent in individual claims submifted by a subrecipient became evidenl when multiple claims were reviewed collectively. Response to Grand Jury Finding #5: Respondent agrees with finding HWS took action as soon as a pattern was established and evidence was available crand Jury Finding #6: F-6 HWS employees lack fraud detection training. Response to Grand Jury Finding #6: Respondent disagrees partially with the findlng. HWS team members are trained in grant and program compliance and administration according to the guidelines provided by HUD and the Federal Office of Management and Budget. ln strengthening the team's ability to detect ineligible costs or potentially fraudulent activity, our team members will attend a specialized fraud data analytics training course that will result in their earning the designation of Certified Fraud Data Analyst. Fraud detection is a specialized activity that requires many hours of specific training, years of direct career experience, and successful completion of a multi-part professional exam to become a Certified Fraud Examiner (CFE), similar to the process of becoming a Certified Public Accountant (CPA). GRAND JURY RECOMMENDATIONS: Grand Jury Recommendation #1 i R-'l The Civil Grand Jury recommends that HWS strictly enforce existing policies that prevent the distribution of grant funds based on claims that lack the required clarity and documentation no later than November 1, 2025. Based on Findings 2, 3, and 4 Financial lmpact-Minimal Response to Grand Jury #1:

lssues that were not apparent in individual claims submifted by a subrecipient became evidenl when multiple claims were reviewed collectively. Response to Grand Jury Finding #5: Respondent agrees with finding HWS took action as soon as a pattern was established and evidence was available crand Jury Finding #6:

HWS employees lack fraud detection training. Response to Grand Jury Finding #6: Respondent disagrees partially with the findlng. HWS team members are trained in grant and program compliance and administration according to the guidelines provided by HUD and the Federal Office of Management and Budget. ln strengthening the team's ability to detect ineligible costs or potentially fraudulent activity, our team members will attend a specialized fraud data analytics training course that will result in their earning the designation of Certified Fraud Data Analyst. Fraud detection is a specialized activity that requires many hours of specific training, years of direct career experience, and successful completion of a multi-part professional exam to become a Certified Fraud Examiner (CFE), similar to the process of becoming a Certified Public Accountant (CPA). GRAND JURY RECOMMENDATIONS: Grand Jury Recommendation #1 i R-'l The Civil Grand Jury recommends that HWS strictly enforce existing policies that prevent the distribution of grant funds based on claims that lack the required clarity and documentation no later than November 1, 2025. Based on Findings 2, 3, and 4 Financial lmpact-Minimal Response to Grand Jury #1: Recommendation has not been implemented, but will be implemented. The implementation time frame is noted in the response. HWS leadership has confirmed that existing policies that govern the disbursement of grant funds will continue to be strictly enforced at all times. This has been communicated to staff by HWS leadership, who are continuing to demonstrate adherence to policy when working with grants and subrecipients. HWS will conduct mandatory training sessions for both managers and grant reviewers by October 3'1, 2025, emphasizing communication, documentation requirements and accountability. Grand Jury Recommendation #2: