Well, good morning, everybody.

The hour of 930 having arrived.

The county audit committee will now be called to order.

Madam Secretary, will you please call the roll?

Good morning, madam chair.

And this is our roll call.

Commissioner Aguilar?

Thank you, sir.

Commissioner Naya.

Is absent for the moment.

Commissioner Britton is absent.

Commissioner Daly.

Thank you, sir.

Commissioner Gainer is excuse.

Thank you, Brandy.

Commissioner Laurie.

Present.

Thank you, sir.

Commissioner McCasco.

Thank you.

Commissioner Miller.

Miller here.

Commissioner Miller is present as well.

Thank you.

Commissioner Moore.

Commissioner Moore is absent.

Thank you.

Commissioner Marita.

Thank you, ma'am.

Commissioner Kevin Morrison.

Thank you.

Commissioner Sean Morrison is excused.

Commissioner Scott.

Present.

Thank you.

Commissioner Stamps.

Commissioner Trevor?

Here.

Thank you.

Commissioner Vasquez.

Thank you.

Commissioner Naya.

Is present.

Madam Chair is present.

Ma'am, let me revisit those that did not respond.

I have absences for the following.

Britain.

Excuse for gainer.

Moore.

An excuse for Sean Morrison.

Ma'am, you do have a quorum.

Thank you, Madam Secretary.

Do we need a motion to allow for remote participation?

We have no requests for remote participation.

Great.

Thank you.

Do we have any public speakers?

And they are no speakers for this meeting.

Thank you.

Commissioner Anaya, will you please move approval of the minutes?

Absolutely.

I'd like to move approval of the committee minutes that took place on May 13, 2026.

This item is 26-1952.

Thank you.

Move by Commissioner Naya, seconded by Commissioner Miller.

Any discussion?

If not, all those in favor signify by saying aye.

Aye.

Opposed nay.

And the opinion of the chairs.

The ayes have it.

Commissioner Anaya, will you please make a motion for the next item?

Yes, I'd like to um move to receive and file item uh 26-1595.

This is the annual letter by um RFSM.

1593.

Um by RSM that summarizes their audit findings for the Cook County uh Board President, the Board of Commissioners, and the audit committee.

Thank you.

It's moved by Commissioner Anaya, seconded by Commissioner Vasquez.

This item 26-1593 is a report presented by our external auditor, RSM.

Uh this letter summarizes matters required by professional standards and includes findings from their annual audit.

Today we have Deanne Sethness, who you guys all know from RSM here to present the findings and discuss them.

Dan.

Thank you, madam chair.

Uh so the report to the board uh contains general information about the audit as well as details about significant estimates.

Uh findings, adjustments, and past adjustments, as well as the management representation letter are included in appendices to that report.

Uh I'm gonna walk through appendix A with the findings and hit on high points of each and then open it up to questions before moving on to the next issue.

Uh one reminder on the classifications is just that material weakness is the most significant uh type of deficiency that we can issue.

And then can uh significant deficiencies are less severe than that.

Um so moving to appendix A and going through the findings, uh finding 001.

Uh this was a material weakness over journal entries.

Uh there was one journal entry found uh recorded to investment income instead of grant income in the amount of 2027 million dollars.

Uh this classification error was ultimately corrected uh in the financial statements.

And then there was a second error where there was a journal entry that was reversed twice instead of being reversed once, and this resulted in overstatement of accrued payroll of 26 million dollars.

This error was also corrected.

Are there any questions with finding 001?

Yes, uh, Chairman.

Thank you for the presentation.

Um just should the steps should there be a now corrected to identify any of the weaknesses.

Are you asking about corrective action?

Yes, yes.

Uh yeah, so the county is is taking steps to um update checklists and controls to try to uh catch these questions.

Is there a specific data in those specific course of action?

Like when will it be finalized?

Uh I believe right now.

You're done.

Okay, okay.

Thank you.

Remedy immediately.

Any other questions on 001?

Seeing no additional questions, we can move to 02.

All right, moving to two.

Uh this is a material weaknesses for uh loan allowances.

Uh there were certain federal programs that are required to be set up as loan programs.

Uh these funds are generally not required to be repaid unless certain uh conditions are met, which leads to a high allowance for uncollectability.

Uh essentially we found errors in applying that allowance policy to certain loans uh and resulted in a six million dollar audit adjustment, which was re uh ultimately recorded.

Are there any questions about finding two?

The corrective action plan.

I'm sorry, I can't yeah.

Yeah, so they are also implementing uh checklists to make sure they're reviewing the the application of the allowance policy.

Seeing no questions, we can move on to 003.

Great.

So 003 is a significant deficiency over expired leases.

Uh the county was not removing expired leases from the capital asset footnote.

Uh these are leases with no remaining book value where the uh asset cost is equal to the accumulated depreciation, so the net book value is zero.

Uh, but the footnote is ultimately grossed up and it should have been removed out of there as they were expired.

Uh the the impact was $18 million, and this was also corrected.

Um, and I know the county has uh implemented checks on their uh lease query software and things like that to look at the outputs and make sure they're looking at expired leases and uh making sure those are taken off the books.

Thank you.

Um four four is a significant deficiency over property taxes uh receivables and uh the property tax objection liability.

Uh the county experienced some delays and changes in reports received from the treasurer's office relating to property tax amounts.

This led to errors in recording of these amounts for both the objections and the receivables.

The objection liability was overstated by 23 million dollars for the county and six million dollars for CCH, and the receivable was overstated by 21 million dollars.

Uh the county I know is continuing to work with the treasurer's office and obtaining and understanding the new reporting uh so we make sure we pick up the right amounts.

Uh oh or seeing no questions on this one.

Oh oh five.

Ooh five is a significant deficiency over construction in progress.

Uh errors were found within this balance uh relating to amounts that should have been expensed in prior years and in the current year, as well as certain amounts that were transferred to CCH.

The total error identified was 19 million was also corrected.

Uh the county has been working uh closely with us for the past year or two on this CIP balance and trying to get a better understanding of what's in there and making sure it's cleaned up and there's um only appropriate amounts remaining.

Cyril, and this one you I know that with this one things were being capitalized when they should have just been paid off, and so you have some benchmarks and some backstop to make sure this doesn't happen again next year.

Uh that's correct, Commissioner.

Okay, thank you.

Uh Commissioner Arnaya has a question at 005.

Yeah, and 05.

It says that due to insufficient management review of capital.

Um was there anything that was specifically um creating that gap in in supervising or or um analyzing or keeping track of that?

Uh yeah, the the reason for the the insufficient was just a lack of oversight over that particular area.

That's why they were able to identify the finding.

So going forward now, we're gonna have more focus on that particular area to address those concerns.

Is there a specific department that um keeps track of it?

We've been working with BA BAM on this particular issue.

I think going forward our communication with them uh will be better as far as addressing those concerns related to these projects.

Thank you.

Thank you, Chair.

Thank you.

Seeing no additional questions, we'll move on to 006.

Finding six is a material weakness over expense cutoff.

Uh we found certain expenses that were recorded in the wrong period.

Uh 21 million dollars for the general fund, which was corrected, and one million dollars in the grants fund, which was passed.

Um I do want to note that this has been a repeat finding for a number of years, but we've seen great improvement in the number of issues found as well as the dollar impact being much lower than it has been in the past.

So I do want to um provide that insight as well.

All right.

So for um this one, it was an expense cutoff.

Uh 20 million dollars was given as a grant to the quantum campus.

Um, and it should have been booked in 20, it was in 25, should have been booked in uh 24, right?

24, 25.

26.

Yeah, 26.

Sorry.

Um, and so it wasn't 20 million dollars of smaller dollars, it was like one big one that they missed.

So it was just like an error in the time frame, but every year we try to book, but you know, there's always usually a mistake on the time frame of when we wrote the check, when the check was cashed, all that kind of stuff.

So I appreciate Cyril's efficiencies in trying to limit this.

I don't know that we'll ever be able to totally eliminate it because there's so much about human functionality in there.

Okay.

Um seeing no additional questions on 006.

Uh, can we move to 007?

Sure.

Seven is a material weakness over the treasurer office property taxes.

Uh so the treasurer's office was using new reports due to the conversion, which resulted in not pulling the correct data into their year-end closed calculations.

Specifically, data related to TIFF districts was not included, and levy amounts were used instead of extension amounts.

The combined errors resulted in a 2.7 billion dollar audit adjustment uh to both the receivable and the payable, and 1.5 billion dollars to the additions and the deductions.

Um I do want to note that these are audit adjustments to accrual financial statements and do not impact the cash collections or disbursements of the treasurer's office.

Um and so we had talked to the treasurer's office about this one, and uh part of that issue was with the Tyler functionality, and they have assured me that this will not repeat next year.

So we'll see.

Um let's move into oh oh well, seeing no questions on 007.

Um we can move on to 008.

Uh finding 008, this is a material weakness over general IT controls for Oracle.

Uh we reviewed controls around the system and found users who could both develop changes and promote those changes to the production environment, resulting in a segregated segregation of duties issue, as there was no additional monitoring control to verify that the changes made were appropriate.

Uh in addition, a user access review was not conducted during the year, and the user controls identified in the Oracle SOC report were not in place during the year.

The combined impact of these issues increases the risk of unauthorized data access and inappropriate data modification.

Okay, so this one we had a lot of conversation about.

So basically, we have database administrators and Oracle, and those administrators develop the changes, then they go to the using agencies who approves them, and then they send them back to sometimes the same people who develop the changes are responsible for pushing the change.

So traditionally in the IT world, the people that develop are not the people that push to make sure that there's no data loss, that we're reducing the vulnerabilities.

Um, you know, we trust our Oracle database developers, but at the end of the day, the recommendation by our audit team, our external audit team who ran this all the way up their whole IT system, still is saying that the county needs to make sure that the people that are developing those changes are not the same people that are pushing them.

So I'd like Tom Lynch to come up to the podium.

Um Tom and I had a conversation about this.

He mentioned that there are four database administrators.

So my recommendation was that project by project that he divide those people somehow, whether it's two and two or three and one.

So the people developing the changes are not the same people who are pushing those changes.

Um this uh discussion really accommodates the fact that we believe that you know these people are doing the best job, that they're having their best day, that they're not trying to make mistakes.

But still in the IT world, there is a human component over this.

So to reduce those vulnerabilities for data loss, I know we're self-insured, so you know, part of the part of that discussion was if we know that this is a vulnerability and we've received a substantial finding for it, and there is a data loss.

Could we then go and claim an insurance for any damages?

So without an insurance company, we maintaining our own insurance, maintaining our own vulnerabilities.

I think it's a good idea for those to be um for those two positions to be split and there to be that wall between them.

Thank you, Commissioner.

Tom Lynch, uh chief information officer.

Uh so there are three elements to the finding, and some are easier, some are harder.

So I'll in reverse order.

Uh we did do the SOC review, which is required annually, but we did not document it, so we fixed that.

That won't happen again.

Uh the user review again also happened and was documented, but it happened in the calendar year, not the fiscal year.

Has to be done by November, not December.

So again, that's a fixed, easy fix be done.

Uh the most complicated of the three is the one uh uh that the commissioners is describing uh about separating who is making changes and who is developing those changes uh in our EBS uh environment.

At a high level, uh the way that Oracle works, it's impossible to separate uh it uh the privileges for those particular types of DBAs.

Therefore, you have to have a mitigating control to separate who is making the change because there's no way to limit their authority uh for that type of role.

So one change that we've already agreed to make, and I believe that the auditors have confirmed it, is a reporting change using database logging to ensure that the change is made, made correctly, and also who is making the change.

We've already sort of worked that part out.

What we're doing right now is figuring out an additional layer of how we can separate which individuals, which people are promoting the change as opposed to developing the change.

So conceptually, I think we agree with doing that, but we have to work with both the external auditors and well as the county auditor to ensure that everybody agrees that mitigating control will satisfy uh the finding uh and prevent it in the future.

I'm glad to hear that that's moving forward.

I think um you know, the first consideration was about data loss and making sure that we really had data integrity and integrity to the system.

You know, secondarily, but equally important is the fiscal um considerations of adding people and then changing coding um to make sure that different database administrators have different usernames to really uh wall that off.

Um so in a difficult fiscal year, I appreciate the fact that you still have four database administrators.

I'm not as concerned about them having a different user name and different access.

It's more about having a supervisor allocate these two people over here to developing and then these two people on that project who know they're pushing, so that these two people you know aren't pushing code changes that may result in lost data or in a correct data because there is human error in there.

So um I think you've come a you know a long way towards negotiating this.

Thank you, Tom.

Um and thank you, Dan, for finding uh some resolution to this.

So when we're gonna keep this finding open and then continue to discuss it at the next audit meeting um in September.

But how long do you think it would take to finalize that process to make sure that those folks are having a separation or segregation of duties?

So we have a proposal at this point, we just haven't had elapsed time to connect with the folks to verify it.

Certainly by the next audit meeting, uh, we should have this resolved.

I'm very confident.

Okay.

And then Dan, could you come in remotely just to make sure my concern also is that if this continues, then we get a repeat finding for it.

But if we've made a meaningful, I think over this time movement towards addressing those changes, that my hope is that next year we won't get a repeat finding, even though this has continued throughout the year because of the county's work to come to the finding with the requisite amount of attention.

Yeah, we can certainly look at that and take look at the steps that are taken to see uh if we can clear that.

But to your point, you know, we're seven months into the next fiscal year already.

Um so it's been the same, you know, situation for seven months.

So we'll we'll take a look at that.

I just don't want to commit to anything.

I guess Mike, I would really like this to be kind of tied off so that I guess if um our uh if Tom Lynch is saying they've made the recommendations that we're talking about here today, and then I'd like you to come back and say yes, we agree, and that that's sufficient to resolve this finding.

Understanding about the timing for next year.

Absolutely, and I agree we should it should be a collaborative process to get together and make sure we're we're agreeing on the solution.

Soy Thank you, Madam Chair.

Just to follow up, so you indicated we're seven months into the same year.

So the likelihood of a repeat finding would be very strong.

Because we're seven months into it already, correct?

Most likely, but again, I don't want to commit to your findings today.

Report back to the chair on this uh repeat finding as well as any other repeat is at your suggestion and any other ones that were open.

I think you know the reality of audits is that you want to identify gaps in systems.

And if we're resolved those gaps in a system, even if we have a repeat finding, I'm not as worried about the repeat finding because the gap has been resolved and our actual operations are improved.

Right.

But I think if if there were previous ones, and I'm just forgetting which one, I think you they were going to report back to the chair whether or not it's completed.

I think there was well one of the first items that any other repeat findings.

Oh, that one, yes.

So that was a repeat.

The repeat finding for CERO's office was basically that for booking things out of time, out of fiscal years.

Yes.

But um I will make a list of these things for potential repeat findings for next year.

Um anything else about 008.

Seeing no additional questions, thank you, Tom.

I think we can move on to 009.

All right, for 009, um, material weakness over general IT controls for the two property tech systems, which are MIS and IS world.

Um, similar type of work was performed where we're looking at the controls around these systems.

Uh for MIS, which is the legacy system, we found a similar issue is with the developers having access to both uh develop and push to production.

Uh and we also found that there was no user access review done for that system.

Uh I do want to note that that system has since been sunset and replaced with IS World.

So the impact going forward is going to be limited.

Um, but obviously it was in place during the fiscal year, so that's why we looked at it still.

Okay.

We also talked to the treasurer's office about this, and because that system is no longer operational, it it will not continue.

And there's no utility to fix something that's not in operation.

So seeing no questions on 009, can let can we move to 10?

Sure.

Uh 10 is a material weakness over the uh conversion itself.

Uh so this there's two facets to this finding.

Uh the first one's related to UAT testing, which is testing whether the system is operating appropriately.

Uh in looking at UAT, we found high level evidence showing it was completed.

Can you explain what the UAT means?

Uh it's user acceptance testing, so that's um, you know, if we're in this screen on the system and we push this button, it's gonna take us to this next screen.

Is that button doing what it's supposed to be doing?

It's really testing whether the system was programmed right and in for a close line.

Yeah.

Um, in regards to that, uh, we were we found high level evidence that they completed the UAT testing, but we couldn't really get detail or reperform it to look at the detail of of issues they ran into.

Um so that was what we reported there.

And then in regards to the data conversion itself, three of the five data sets uh we tested, we were unable to see the support to show that the data was converted appropriately or and didn't see any overarching validation by the county or the treasurer's office on the back end to show that the entire conversion was appropriate.

Um I do want to note that we didn't find any issues with the underlying data when we were doing our testing uh in during other audit procedures, though.

Okay, and then what was the response to that?

Um I would say the response was um that the they felt BOT along with um all the offices involved in the conversion felt that they did their duty as the individual office.

So treasurer's office validated their file that went up before it went up to Tyler.

Uh assessor's office did the same, etc.

etc.

Um the issue was that a lot of these data sets were being combined or manipulated for the ultimate output, and nobody was checking internally what that output file was and making sure that it was appropriately modified.

Um the management response was that they felt like they had actually done the work, just they didn't document it.

Is there some um critical components that they'll do next time they have UAT to make sure that this is not a repeat finding?

Yeah, I think I think at the crux of this, a lot of it was a documentation issue, right?

They were doing the steps, we could see that they were done.

It's just we couldn't maintain the evidence and and look at the details.

So I think going forward, if there was another conversion taking place, they now know to maintain that evidence and have it ready for for us on the bike.

And they've committed to do that.

Yes.

Okay.

Um expired leases.

Uh the next four findings are uh findings for the CCH just to note.

Um so this expired lease finding is the exact same finding as 003.

It's just CCH's version of it.

So these are expired leases that weren't being removed from the capital asset footnote.

Uh, you talk to the CFO, is the CFO from the hospital system here?

Online.

Lynn.

Do you see if the CFO for the hospital system is here?

No, ma'am.

But if you give us a phone number, we will call the office.

But no one is connected.

Okay, why don't we just go through these four CCH ones and then we'll try to circle back and see if they're there in case there are questions.

Expired leases.

Sure, sure.

So expired leases is the same issue as the county, they weren't pulling them off the footnote.

Uh for the CCH, it was 28 million dollars, and this was ultimately corrected.

Again, no net impact, the net impact zero, but it's just a gross up.

Um finding 12 is a significant deficiency for expense cutoff, again, similar to the county finding six for expense cutoff where things were being uh expensed in the wrong period.

Uh this resulted in understatement of AP uh about 11.5 million dollars in this adjustment was passed.

Uh finding 13, a significant deficiency for receivables.

There was a backlog in billing that resulted in inaccurate estimate of receivables at year end.

Receivables were ultimately overstated by 12 and a half million dollars, and then adjustment was passed.

And then finding 14, there was a significant deficiency for AP misclassification.

Uh there were credit balances associated with patient accounts that were inappropriately recorded to AP instead of a reduction of the receivable.

Uh, this is about 11 million dollars and was also passed.

Okay.

So we will see if the CFO from the hospital is but these four about expired leases.

Well, I know that that was a new reporting mechanism that may not have been a repeated finding, but for the accounts payable cutoff year was incorrect.

The hospital receivings where the billing came in late on the wrong year, and the journal entries, those are repeat findings.

These are not repeats, no, these are all new.

All right.

Well, we will coordinate on those.

I think that those were on the county side as well, and we have um mechanisms to make sure that those don't happen again so CERL can coordinate with CCH.

And if the CCH person comes on and anybody has questions, then we can coordinate on that.

Do I see any questions on these last four hospital findings?

Seeing no questions, the motion on the floor is to receive and file.

All those in favor signify by saying aye.

Oppose, nay.

Opposed, nay, and the opinion of the chair, the ayes have it.

Commissioner Anaya, please make a motion for the next item.

I like to motion um to receive and file um the item 26-1592.

This is the Cook County Annual Comprehensive Financial Report.

Moved by Commissioner O'Naya, seconded by Commissioner Trevor.

This item 26, 1592 is the annual comprehensive financial report for FY25 with financial statements prepared by the Office of the Cook County Comptroller and audited by RSM.

Dan Suthnes, will you please present these?

Sure thing.

If you want more detail, feel free to keep flipping through the large document.

Some highlights though include a reduction in the overall deficit by nearly 2.2 billion dollars, primarily driven by a reduction in pension OPEB liabilities and an increase in revenues.

Opening that position was restated due to an implementation of a new GASB standard for compensated absences.

And the county continues to balance its debt, making all scheduled payments and issuing new sales tax bonds in FY25.

Are there any questions on the ACFR?

Seeing no questions, the motion on the floor is to receive and file this item.

All those in favor signify by saying aye.

Opposed nay.

In the opinion of the chair, the ayes have it.

Let's see if both of the hospitals connected, Scott.

Okay.

Does anybody have any questions about the four um hospital findings that we had discussed previously?

I mean, if they could just reiterate that they have corrected some of those measures.

Yes for the record.

Scott.

Scott, can you hear me?

Uh yes, I'm here.

Madam Chair has a question for you.

Thank you, Scott.

So there were four audit findings relevant to the hospital system.

The expired leases that weren't removed from uh the footnotes and depreciation weren't uh they weren't removed from your books, the accounts payable and where the cutoff year was incorrect.

Um your hospital receivables were receivables where the billings came in late in the wrong year, and then the journal entry errors for 10 million dollars.

So you have looked at these four findings and you have put some mechanisms in place in order to ensure that they're not repeated.

Is that right?

Yes, yes, we have.

Okay.

And Dan is uh our RSM external auditor is uh nodding his head to show that he's received them.

And uh I don't have any questions on the floor, but I think our expectation is that we uh endeavor not to have repeated findings next year.

Thank you very much for being here.

You know, I think actually we need to take a quick pause because we had one person come in late who had filed a request to speak.

A request to speak.

So we're gonna take a pause.

Thank you, Dan.

We do have one public speaker uh that registered after meeting began.

Persons authorized to provide public testimony shall not use vulgar.

Abusive, discriminatory, profane, or other other or otherwise inappropriate language when addressing the body.

Failure to act appropriately or failure to adhere to the time.

Requirements may result in expulsion from the meeting and or disqualify the person from providing future testimony.

George Blakemore is our registered speaker.

Please come to the podium.

George Blake Moore?

Oh back here.

Please begin, sir.

Thank you for allowing me to speak.

I'm a little late.

And I'm always listening to Ms.

Jackson.

She said that she wasn't a canon.

She had to audit uh the money up in LA.

School system.

So it's a paid betrayal and the theft and the fraud and abuse of the system is through the audit.

How is the money being spent?

It's very important.

The crooked auditors too.

And the system is broken.

And I'm so uh I'm happy with the way you have this arrangement for the speakers.

Why would you have you had this uh over here?

Well, the people could speak and be out of the way.

But but the commissioners would turn around and have confrontation with the speakers.

You all got to conduct yourself as uh public servants.

You don't all go back and forth with the people you are serving, even though if they have a right to be critical of your behavior, because you represent them.

So you decided to move it over here, and then people come coming by if it's it's just something else.

Uh I don't know what's the cure for this system.

It's it's broken.

I asked one of the workers, are you a Democrat?

Are you a Republican?

He said I'm an independent.

So uh we're not gonna label the parties, the the Democrats uh are the Republican.

The system is broken.

And it has to be a change.

One minute.

It has to be a change.

And the reason is not a change because the people are not involved.

The election is no such thing as an election board.

They steal the election.

Oh, they don't steal no election.

Oh, yes, they do.

The system is broken.

It is completely out of control.

Why?

Well, who would even suggest the movement and then 30 seconds?

And then the sheriff said you can't come back.

And then the the ultimate is ordin with the speaker.

And the speaker from the public, it's all with the ultimate.

I've never seen this kind of like this.

And all my years are coming here.

It's completely uh out of control.

And time is expired.

The system is broken.

The system is broken.

Thank you.

Um Commissioner Anaya, will you please make a motion for the next item?

Yes, uh, Chair.

I'd like to uh motion to receive and file item 26-1595.

This is the Kakani report on federal awards.

Sorry, 92?

1592, right?

I think we just did that one.

That was a good idea.

Yeah, we're yeah, we just did that one.

I think uh we're 2615 ninety-five.

You are my little arrows were on the wrong point.

All right, the motion on the floor is oh so uh item number 26-1595 is a report on the federal awards for FY25, otherwise known as the single audit.

This audit includes um the schedule of expenditures of federal awards prepared by the Comptroller's Office and compliance for each one of those major federal programs on our internal and on our internal controls.

The audit was done by Washington Pittman and McKeever.

Uh Brent Bacas, partner at WPM is here to speak to this item and answer questions.

Um Commissioner and I am moved, seconded by Commissioner Aguilar.

Thank you.

Good morning, everyone.

Thank you for that.

Uh as noted, I am Brent Backett serving as principal on the audit.

Uh, I'm joined here by Marsha Lopez, who's audit manager as well.

Uh so looking into our report, if you go to uh page 75, it kind of highlights the summary of results there.

Uh so there were no material weaknesses identified.

There were some significant deficiencies.

Uh we do have the audit findings that are disclosed as well on the uh subsequent pages as well.

Uh we tested six programs, and I'll just highlight some of our uh findings as indicated here.

Um 2025 oh one was a finding from subreciparent monitoring special tests uh from housing quality standards.

Uh the context basically was that there was not the uh report, well, I guess not the monitoring uh as detailed as it would need to be in accordance with the guidelines there.

Uh we kind of highlight uh that we noted 37 projects were included on the program.

We looked at the winter rental portfolios, which require annual monitoring uh per the uh DPD's internal policies that we noted that three uh of these projects had some monitoring done during the period uh which there was some review of tenant files, but there was no additional documentation provided to verify compliance with the federal uh regulations.

No, um with one.

Excuse me.

Was that are you finished with zero?

Yes, I was moving.

Yes.

So for this, you know, we have the home program, which we vote on different amounts of money that go and promote our these HUD programs.

Uh compliance includes our risk assessment of its portfolio, and um we are required then for our compliance for that money to monitor the the projects.

So um Susan Campbell is here to talk a little bit more about that, but basically I think uh we were audited on 37 uh different projects, and the county was only monitoring uh the the work on one, and there was kind of a gap on that, but there has been some mechanisms put into place to ensure that this does not happen again.

So we'll hear from the county.

Yeah.

That is correct.

Uh going to the hold on.

We're front, we're just the county's gonna come up and talk about 001.

Sorry good morning, Carl Brailly, Deputy Director of Housing.

Thank you, Carl.

DPA.

Two things.

One is that yeah, we're required to monitor a third of our portfolio annually, and we did not make that marker.

Um post-COVID, we had a moratorium on this from HUD, and then we had to react it in 2024, we were out of alignment both with staffing and with trainings to complete the task.

Subsequently, we have uh trained our staff and increased our setup to meet this requirement um last year, and our goal is to uh complete the monitoring on the discounter year, which we've already scheduled or begun the schedule for uh a third of our portfolio.

We're targeting a half of our portfolio this year to catch over 100 percent over two years, and that should bring us back into compliance.

So for the um the houses that weren't monitored as we had discussed, there are no significant deficiencies in the home those homes that were built by these developers that would leave us vulnerable as the county, right?

Yes, currently that we have we have no major deficiencies.

We have one project that's in work out, but we're working with the with the state to complete that component part, all of the properties that have major any major deficiencies we would know about.

Okay, and so then on a going forward basis, you don't anticipate this would be a repeat finding.

No, I don't just be additional finding or additional risk to the county.

Okay.

Any questions on 001?

Seeing no questions, thank you very much.

Um DPD, we can move on to 002, Brent.

Thank you for that.

Uh moving forward, the second uh finding had to do with coronavirus funds.

Um, context here, doing our review for subrecipient uh populations.

We noted that uh in one of the files that there uh there was a monitoring law completed, but based on the risk assessment, similar to what we mentioned for some of the previous ones, uh these were all around risk assessments, but uh the risk assigned rating of four logs was required.

Uh for 11 subrecipients, we noted the risk assessments had expired uh and expiration date range from 167 to 920 days over the assigned due date.

So there's a certain time frame of which you're supposed to perform these and you know, obviously follow up accordingly.

Uh, we know that uh the county executed a sub-recipient agreement uh signed December 2024 prior to verifying that sub-recipient had a unique unique uh entity identifier number, uh, which was active date January 20th of 2025, which is uh required by uh federal regulation.

Okay, so for the 11 sub recipients, um we noted the risk assessment assessments were expired, ranging from 167 to 920 days.

Um of the 11 sub-recipients, six had risk assessments outstanding and three had advancement requests approved without a risk assessment, and the total amount advanced to those three sub-recipients was 772,000 dollars.

So is there has the county responded to that um with your you know, based on your recommendation with a corrective action plan?

Yes, they have is included in uh the final pages uh of the report as well, too.

Um the date what was it, Marsha?

24?

744 and 44.

Marsha, it's like the corrective action plan.

You're satisfied with it.

Correct.

And you know, this program is expected to end for the next fiscal year, so as part of the closeout process, the county will ensure that all the remaining sub-recipients are completed.

So we don't expect this one to repeat.

Okay, thank you.

We can move on to 003.

Thank you.

Marcia, can you just uh address who you are for the record?

Audit manager Washington Pittman and McKeever.

Thank you.

State your full name, Marcia.

You want me to continue?

Okay, so finding finding 003.

Marsha, can you state your full name for the record?

Marcia Lopez, Washington Pittman and McKeever, audit manager.

Can you move on to the next one?

Oh, three.

I sure can't.

So finding so finding 003 is program income over the uh HIV emergency relief program funds.

And so for this one, we noted that um through initial discussions with the department, there were no program income reported for this program, but through our review of eligibility testing, we determined that there were several participants that um had their own uh insurance, which resulted in program income under the program.

The department did go back and was able to generate a report that showed about 2.9 million um in program income, and so that information was um we we recommended at the department ensure that that information was communicated to their grantor agency.

Okay, and so I see that the county had agreed with the finding and they had uh published a corrective action plan.

And so what's the likelihood of this having our repeat finding if those corrective actions are implemented based on a corrective action?

I don't anticipate this one to repeat.

Okay.

Seeing no questions on this one, or Commissioner Lowry.

No, I'm sorry.

Yeah, okay.

Yes.

Uh can we move on to the next one?

Thank you.

Sure.

Um finding 2025 004 is overreporting for the Homeland Security Grant Program.

Um for that one during our test of reporting, we noted that the department was behind in submitted in re its reimbursement requests um to its grantory agency.

And so um the plan is to get caught up with about 16 um quarterly reimbursement requests, and so of course it will take the department time to um implement their corrective action plan.

So we'll monitor that one for for next fiscal year.

But hopefully it's you know they'll they're they'll will be able to get caught up in this one won't repeat.

Okay.

So for this one, the department of emergency management didn't submit required quarterly reporting for 22, 23, and 24 for our grant agreements.

Um they have gone back and asked the feds if they could bundle them all together just to have one um series of reporting, and the feds have just said no that they need to continue them out.

So they're gonna have to file 16 separate grant agreements, and they have um been doing that, and they'll continue that until it's resolved.

And it's my understanding that the grant funding is not really at risk.

So hopefully that should be okay.

Um seeing no questions on that one, we can move on to the next one, please.

So that was all for this year.

And then uh as a review for prior year findings, we looked to see uh the status.

There were three that we looked at, and they did not repeat for this year.

So happy to uh report that those were implemented uh appropriately as well.

Okay, so that um that's the end of the single audit discussion, is that correct?

Correct, that's correct.

Okay, thank you very much today uh for coming today.

So seeing no additional questions on the single audit, the motion on the floor is to receive and file this item.

All those in favor signify by saying aye.

Oppose nay, and the opinion of the chair, the ayes have it.

Commissioner Naya, will you please move the next item?

Yes, I'd like to move to receive and file item 26-1596.

This is the Cook County Health and Hospital Systems Financial Report.

Thank you.

It's moved by Commissioner Naya, seconded by Commissioner Stamps.

Um, this item 1596 is the FY annual audit of the CCH financial statements prepared uh initially by CCH finance and then audited by RSM.

Deanne Southens is here to present this item.

Thank you, Chair.

Uh these statements have been presented separately or will be to the CCH board.

Um so I'll just touch on them very quickly.

Uh a few highlights.

Uh operating income was 194 million dollars, which included 634 million in net patient revenue, 657 million of directed payments, and 3.6 billion from county care capitation revenue.

And the overall change in that position was uh a positive increase of $703 million.

Uh and then the county transferred 12 million dollars of capital assets to CCH and provided 233 million dollars of additional transfers in the majority of that representing pension and op payments made on their behalf.

Are there any questions on the CCH financial statements?

So 233 million that was transferred in that was a plan for a transfer from the budget.

Yes, correct.

Okay.

Um I don't see any questions on the floor on this item.

The motion on the floor is to receive and file.

All those in favor signify by saying aye.

Opposed nay in the opinion of the chair, the ayes have it.

Um Commissioner Nyah, will you please move the next item?

To move to receive and file item uh 26-1597.

This is a county um health and hospital system report to the audit and compliance committee.

Move by Commissioner Anaya, seconded by uh Commissioner Scott.

This item 26, 1597 is a report presented by RSM.

It is intended solely for the CCH audit and compliance committee and summarizes matters required by all of our professional standards to be communicated to them and their oversight responsibility for CCH's financial uh reporting process.

Um do you have any do we have any questions on this?

Item seeing no questions, the move motion on the floor is to receive and file this item.

All those in favor signify by saying aye.

Oppose nay in the opinion of the chair, the ayes have it.

Commissioner Anaya.

Yes, I'd like to uh move to receive and file item 26-63.

This is a 2025 uh Cocounty Treasurer's Office audit.

Move by Commissioner Anaya, seconded uh by Commissioner Lowry.

This item 26-1663 is the Cook County Treasurer's Office FY25 audit.

The audit was done by RSM.

Thank you.

We have Dan Sethness here to present and take questions.

Is joining us virtually if we have questions, thanks, Commissioner.

Just a few comments here on the treasurer financial statements.

Um as a reminder, these represent the treasurer custodial fund only, which is the function of the treasurer, where they're acting on behalf of others to collect and remit property taxes.

Um and looking at the changes from the prior year assets and the corresponding liability to the municipalities increase about 10 and a half billion dollars, primarily due to the delay in the property tax billing, um, as you would expect those receivables to go up.

Um and then the end of these statements do include the findings that specifically relate to the treasurer's office, but we've already covered those.

Great.

The motion on the seeing no questions, the motion on the floor is to receive and file this item.

All those in favor signify by saying aye.

Opposed nay.

And the opinion of the chair, the ayes have it.

Commissioner Anaya, will you please move our final item?

To move it uh to receive and file item 26-15 and 98.

This is the Cook County, Illinois actuarial uh study of the workers' compensation and liability self-insurance programs.

Thank you.

Move by Commissioner Anaya, seconded by Commissioner Miller.

This item 26-1598 is the Cook County, Illinois actuarial study of the workers' comp and liability self-insured program, completed by AN.

We have um Alisa Surovachka from AN and uh our director of risk management, Deanna Zales to present and take questions.

Thank you, Chair.

Uh Deanna Zale is director of risk management.

We partner with AON to perform the actuarial study on an annual basis.

The numbers are then incorporated into the expert document you just reviewed as well as the annual budget.

I'll turn it over to Alyssa Siravaca for a quick summary of the of the report.

Thank you for inviting me here today to present.

Uh just at a high level, uh, the estimated outstanding losses, which is the bulk of the result of the purpose of our analysis.

The estimated outstanding losses as of 1130 25 on an undiscounted basis are 1 billion 1.55 million.

Uh that is a decrease from our estimate as of 1130-24 of 16 million.

The bulk of the uh bulk of the reserves are in uh law enforcement liability, which are represent about 450 million of our estimate or 39% of the total reserves.

The next uh largest category is workers' compensation, which is about 303 million dollars and represents about 26 million or 26 percent rather of our total reserve estimate.

The other pieces that we look at each represent less than 15 percent of the total reserve.

In addition to estimating the outstanding liabilities, we also estimate what the uh estimate what the losses will be for claims that occur, not pay but occur during the 25-26 fiscal year, and we estimate those on an expected value to be um discount and uh undiscounted expected value to be 181 million.

We also look at these on a discounted or present value basis, and that estimate is 155 million.

In our report, we also provide estimates of what higher confidence levels, which would respond an expected level would cover five out of six years.

Uh the higher confidence levels, 70 and 90 estimates reflect what it would take uh to cover seven out of ten years or nine out of ten years, and if we're looking at the full value, so undiscounted 90 percent, that estimate is 275 million.

That's the high level.

Um, if happy to answer any questions anyone may have regarding our analysis.

Thank you.

Seeing no questions on the floor, the motion on the floor is to receive and file this item.

All those in favor signify by saying aye.

Oppose nay, and the opinion of the chair of the ayes have it.

Commissioner McCaskill moves to adjourn, seconded by Commissioner Scott.

All those in favor signify by saying aye.

Aye.

Oppose nay.

And the opinion of the chair, the ayes have it.

Thank you very much.

And I'd also like to wish Commissioner Anaya's chief of policy director, a very happy birthday, Nancy.