USDA Grant / Powder Coating System - … Grant / Powder Coating System February 25, 2014 Dwight E....
Transcript of USDA Grant / Powder Coating System - … Grant / Powder Coating System February 25, 2014 Dwight E....
BCC / CCAA Meeting
Immokalee Regional Airport
USDA Grant /Powder Coating System
February 25, 2014
Dwight E. Brock 1
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Overview2013
Immokalee Regional Airport – 2013Collier County Property Appraiser – Aerial Image
Manufacturing Incubator II
Incubator II
• Between 1999 - 2002, the Collier County Airport Authority(CCAA) was awarded a Community Development Block Grant(CDBG) for $750,000 and a United States Department ofAgriculture (USDA) grant for $250,000 requiring a match of$639,000 for the Immokalee Regional Airport to construct anincubator facility and a powder coating system.
• The USDA grant application indicated the powder coatingfacility would consist of primary equipment including: firebatch oven, conveyor belts / overhead electric hoist gantrysystem, rinse / dip tanks, transfer booms, hand push conveyorsystem, powder-cartridge booth, and powder guns withhopper.
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Background
• Global Manufacturing Technology, Inc., was responsible for thepurchase of the secondary equipment (approximately$100,000) including: outside propane storage tanks, holdingtanks, and evaporator system.
• On June 24, 2003, the BCC declared Global ManufacturingTechnology, Inc. in default for not being able to perform theterms of the Participating Agreement.
– The powder coating system was incomplete with secondaryequipment not provided.
• In February / March 2004, the BCC approved two budgetamendments for $21,000 and $16,000, a total of $37,000,for the conversion of the powder coating system into a wetsystem. 4
Continued…
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Immokalee Regional AirportField Work Photographs - Powder Coating Equipment (in use)
Batch Oven
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Immokalee Regional AirportField Work Photographs - Powder Coating Equipment (in storage)
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Immokalee Regional AirportField Work Photographs - Powder Coating Equipment (in storage)
Unused equipment inboxes in storage
• Approximately $163,000 was spent for a powdercoating system that was never completed and wasnot put to the intended use, which violates grantassurances.
– Grantor agency approval was not obtained for the changeof use.
• The current tenant is using a portion of the equipment.
– A portion of the equipment was relocated to storage andsome equipment could not be located by Airport staff.
• The County has not complied with FloridaAdministrative Codes (FAC’s) for asset records. 8
Summary of Findings
• Manufacturing incubator lease concerns:
– The lease expired on April 13, 2007 and no new leasewas executed.
– The lease appears to have been continued on a monthto month basis, but the initial contract andamendments did not provide a term for month tomonth continuation.
– Rent is not being charged at fair market value.
– Late payments and terms of payments were notapproved by the BCC / CCAA.
– Interest and late payment fees do not appear to havebeen charged.
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Continued…
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The CCAA should:
• Notify the USDA of violations for the $250,000 grantand work with the USDA for resolution.
• Provide Clerk’s Finance with appropriate paperworkto accurately reflect the asset records and value.
• Review the $750,000 CDBG grant for compliancespecifically job creation requirements and programincome.
• Verify all tenants have leases and insurance.
• Resolve the Manufacturing Incubator II leaseconcerns.
Overall Recommendations
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In the future, the CCAA and County should:
• Comply with the Code of Federal Regulations(CFR’s), grant agreements, and grant assurances.
• Obtain grantor approval prior to using grantassets for other activities.
• Monitor assets and capital projects to ensureassets are appropriately recorded and complywith federal requirements.
• Continually monitor and review leases to ensuretenants are compliant and maintain properinsurance.
Continued…
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• The powder coating system was never completed.
• Secondary equipment was required to have afunctioning powder coating system. This equipmentwas not provided by Global ManufacturingTechnology, Inc.
• Once the powder coating equipment was installed,the equipment was partially dismantled and aportion of the equipment moved to storage.
• Grant funds were used to purchase and install thepowder coating system. The grantor has notprovided written approval for the change of use, asrequired by the grant conditions.
Conclusion
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Thank you
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