Audit Report

OIG-18-050

RESTORE ACT

Santa Rosa County’s Internal Control over Federal Awards

August 7, 2018

Office of

Inspector General

Department of the Treasury
This Page Intentionally Left Blank
Contents

Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page i 

Audit Report

Results in Brief........................................................................................... 1 

 

Background................................................................................................ 3 

 

 RESTORE Act......................................................................................... 3 

 Santa Rosa County ................................................................................. 4 

Audit Results .............................................................................................. 5 

Documented Policies and Procedures ........................................................ 6 

 

Risk Assessment .................................................................................... 8 

Conclusion............................................................................................. 9 

Appendices

Appendix 1: Objective, Scope, and Methodology........................................ 10

Appendix 2: Santa Rosa County Management Response ............................. 14 

Appendix 3: Treasury Management Response ............................................ 15 

Appendix 4: Background on the Gulf Coast Restoration Trust Fund............... 16 

Appendix 5: Major Contributors to This Report...... ..................................... 19 

Appendix 6: Report Distribution................................................................ 20

Abbreviations

BOCC Board of County Commissioners

Clean Water Act Federal Water Pollution Control Act

GAO Government Accountability Office

grants manual Santa Rosa County Florida Grants Manual

IT Information Technology

IT manual Santa Rosa County Clerk of the Court IT Administrative 

Policy and Procedures Manual

MYIP Multiyear Implementation Plan

OMB Office of Management and Budget
Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page ii 

 

RESTORE Act Resources and Ecosystems Sustainability, Tourist

 Opportunities, and Revived Economies of the Gulf Coast 

 States Act of 2012

Santa Rosa County Santa Rosa County, Florida

Treasury Department of the Treasury

Trust Fund Gulf Coast Restoration Trust Fund 

Uniform Guidance Uniform Administrative Requirements, Cost Principles, and 

 Audit Requirements for Federal Awards
OIG Audit

Report

The Department of the Treasury

Office of Inspector General

Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 1 

August 7, 2018 

David A. Lebryk 

Fiscal Assistant Secretary 

This report presents the results of our audit of Santa Rosa County, 

Florida’s (Santa Rosa County) internal control to administer grants 

under the Resources and Ecosystems Sustainability, Tourist 

Opportunities, and Revived Economies of the Gulf Coast States Act 

of 2012 (RESTORE Act).

1

1 Pub. L. 112-141, 126 Stat. 588-607 (July 6, 2012)

 We performed this audit as part of our 

ongoing oversight of programs and activities funded under the 

RESTORE Act. Our audit objective was to assess Santa Rosa 

County’s internal control over the administration of Federal awards 

in accordance with Federal laws, regulations, and the Department 

of the Treasury’s (Treasury) grant application requirements. The 

scope of our audit comprised Santa Rosa County’s internal control 

in place from September 2014 through December 2017 as it 

related to the administration of Federal awards. Appendix 1 

provides more detail of our audit objective, scope, and 

methodology.

Results in Brief

In brief, we concluded that Santa Rosa County had designed and 

implemented a system of internal control2

2 Office of Management and Budget‘s Uniform Administrative Requirements, Cost Principles, and Audit 

Requirements for Federal Awards states “Internal control(s) means a process, implemented by a nonFederal entity, designed to provide reasonable assurance regarding the achievement of objectives in the 

following categories: (a) Effectiveness and efficiency of operations; (b) Reliability of reporting for 

internal and external use; and (c) Compliance with applicable laws and regulations.” (2 CFR Part 

200.61, Internal controls) 

to administer Federal 

awards as required by the Office of Management and Budget‘s 

(OMB) Uniform Administrative Requirements, Cost Principles, and 

 
Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 2 

 

Audit Requirements for Federal Awards (Uniform Guidance),

3

3

 OMB’s Uniform Guidance became effective December 26, 2014.

Treasury’s RESTORE Act Financial Assistance Standard Terms and 

Conditions and Program-Specific Terms and Conditions, and 

Treasury’s RESTORE Act Direct Component Guidance and 

Application to Receive Federal Financial Assistance. While we 

reached this conclusion at the completion of our audit, not all 

control activities were in place at the start of our audit in July 

2015. That is, controls to administer grants in the areas of 

budgeting, cash management, disbursements, financial reporting, 

inventory management, procurement, program management, and 

performance monitoring were in place and operating as evidenced 

in our process walkthroughs. However, certain control activities in 

these operational areas were not completed. Specifically, policies 

and procedures were not fully documented, and an entity-wide risk 

assessment had not been conducted.

Prior to the completion of our audit in December 2017, Santa Rosa 

County completed documentation of policies and procedures in its 

Santa Rosa County Florida Grants Manual (grants manual) and 

Santa Rosa County Clerk of the Court IT Administrative Policy and 

Procedures Manual (IT manual), which we found to sufficiently 

document controls over Federal awards and the supporting IT 

systems and applications to process them. Furthermore, a 

comprehensive entity-wide risk assessment was completed in April 

2017 that identified relevant risks consistent with our earlier 

conclusions. As such, we make no recommendation in this report.

As part of our reporting process, we provided Santa Rosa County

an opportunity to comment on a draft of this report. In a written 

response, Santa Rosa County management agreed with the 

report’s results and its accuracy, completeness, balance, and tone.

Santa Rosa County management’s response is provided in its 

entirety in appendix 2 of this report. 

In a written response, Treasury management concurred with the 

report’s conclusions. Treasury management’s response, in its 

entirety, is included as appendix 3 of this report.

 
Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 3 

 

Background 

RESTORE Act

The RESTORE Act established the Gulf Coast Restoration Trust 

Fund (Trust Fund) within Treasury to provide funds for 

environmental and economic restoration of the Gulf Coast region

that was damaged by the 2010 Deepwater Horizon oil spill. 

Deposits into the Trust Fund will be comprised of 80 percent of all 

civil and administrative penalties paid after July 6, 2012, under the 

Federal Water Pollution Control Act (the Clean Water Act).

4

4 33 U.S.C. § 1251 et seq. 

Treasury is responsible for administering the Direct Component of 

the Trust Fund which is comprised of 35 percent of deposits from 

settlements plus interest. Direct Component funds are available to 

the Gulf Coast States in equal shares in the form of grants for the 

purpose of economic and ecological restoration. For the State of 

Florida, the funds will go directly to the impacted Florida counties, 

with 75 percent of funding going directly to the eight

disproportionately affected counties5

5 Disproportionately affected counties means the counties of Bay, Escambia, Franklin, Gulf, Okaloosa, 

Santa Rosa, Wakulla, and Walton in the State of Florida.

impacted by the Deepwater 

Horizon oil spill and 25 percent going directly to the 15 nondisproportionately impacted counties.

6

6 Nondisproportionately impacted counties means the counties of Charlotte, Citrus, Collier, Dixie, 

Hernando, Hillsborough, Jefferson, Lee, Levy, Manatee, Monroe, Pasco, Pinellas, Sarasota, and Taylor 

in the State of Florida.

Under the Direct 

Component, each eligible applicant must prepare a Multiyear

Implementation Plan (MYIP) before submitting an application for 

funding, unless it is applying for planning assistance funds to 

develop its plan. Direct Component funds can be spent on: (a) 

restoration and protection of the natural resources, ecosystems, 

fisheries, marine and wildlife habitats, beaches, and coastal 

wetlands of the Gulf Coast Region; (b) mitigation of damage to 

fish, wildlife, and natural resources; (c) implementation of a 

Federally approved marine, coastal, or comprehensive conservation 

management plan, including fisheries monitoring; (d) workforce 

development and job creation; (e) improvements to or on state 

parks located in coastal areas affected by the Deepwater Horizon 

oil spill; (f) infrastructure projects benefitting the economy or 

 
Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 4 

 

ecological resources, including port infrastructure; (g) coastal flood 

protection and related infrastructure; (h) promotion of tourism in 

the Gulf Coast Region, including promotion of recreational fishing; 

(i) promotion of the consumption of seafood harvested from the 

Gulf Coast Region; (j) planning assistance; and (k) administrative 

costs. Details of the Trust Fund are provided in appendix 4.

Santa Rosa County

Santa Rosa County is located in northwestern Florida with 

coastlines along the Gulf of Mexico. Due to its location and 

coastline, Santa Rosa County is one of Florida’s disproportionately 

affected counties and will receive a greater percentage of Florida’s 

allocation of the Direct Component funds. Santa Rosa County is 

estimated to receive $29.3 million based on the Federal 

Government’s settlement with Transocean,

7

7 Transocean defendants include Transocean Deepwater Inc., Transocean Offshore Deepwater Drilling 

Inc., Transocean Holdings LLC, and Triton Asset Leasing GmbH.

Anadarko Petroleum 

Corporation, and BP Exploration & Production Inc. defendants. Of 

that amount, approximately $7.6 million has been made available8

8 The “amount made available” represents Santa Rosa County’s portion of the Trust Fund deposits from 

all penalty payments plus interest available for award, and not necessarily the amount awarded to date. 

to Santa Rosa County under the Direct Component as of April 9, 

2018.

9

9 Current Trust Fund allocations, including funds available and funds obligated or transferred by 

RESTORE Act component are publicly available on the U.S. Treasury Restore Act homepage: 

https://www.treasury.gov/services/restore-act/Pages/home.aspx

Santa Rosa County’s organizational structure is comprised of 

elected officers to include the Sherriff, the Supervisor of Elections, 

the Property Appraiser, the Tax Collector, the Board of County 

Commissioners (BOCC),

10

10 The Board of County Commissioners consists of five elected commissioners who serve as the 

legislative and policy setting body of Santa Rosa County.

and the Clerk of the Circuit Court.11

11 The Clerk of the Circuit Court oversees an organization that performs a wide range of record keeping, 

information management and financial management in the judicial system and Santa Rosa County 

Government including the Procurement, Legal, and Finance departments.

The 

BOCC, which houses the Santa Rosa County’s Grants and Special 

Projects Department, and the Clerk of the Circuit Court, are directly 

involved in the oversight and administration of Santa Rosa 

County’s RESTORE Act grants. 

 
Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 5 

 

On September 13, 2012, the BOCC passed and adopted

“Resolution No. 2012-32,” which established the Santa Rosa 

County’s RESTORE Council. The council is comprised of 11 

members of which 5 are appointed by the BOCC based on an 

expertise in a pertinent area such as the environment, economic 

development, or tourism. The council is tasked with reviewing 

proposed projects to determine eligibility and then making project

recommendations to the BOCC. Council meetings are the first 

venue for the public to participate in the selection process for 

RESTORE Act projects.

On June 24, 2013, Santa Rosa County Grants and Special 

Programs Department contracted with a professional services firm 

to augment the county’s staff and to help the county maximize 

funds flowing from various sources to address the Deepwater

Horizon oil spill. The contractor’s services included planning and 

development of Santa Rosa County’s MYIP. On September 24, 

2015, the BOCC approved the draft MYIP for public review and 

comment, which closed on November 16, 2015.

On November 23, 2016, Treasury awarded $108,000 of planning 

assistance to Santa Rosa County to develop a MYIP and authorized 

pre-award costs for services provided by the contractor. On May 

16, 2017, Treasury accepted Santa Rosa County’s MYIP, which 

included 14 projects totaling $3,712,355. Of that amount, 

Treasury awarded $272,950 for the “Gulf Coast Discovery Center, 

Phase I” project on November 16, 2017.12

12The MYIP and the “Gulf Coast Discovery Center, Phase I” project grants were not within the scope of 

this audit given the timing of these awards.

Audit Results 

As a Federal grant recipient, Santa Rosa County was required by 

the Uniform Guidance to “establish and maintain effective internal 

control over the Federal award that provides reasonable assurance 

that the non-Federal entity is managing the Federal award in 

compliance with Federal statutes, regulations, and the terms and 

conditions of the Federal award.” The Uniform Guidance further 

required that “these internal controls should be in compliance with 

the Government Accountability Office’s (GAO) Standards for 

 
Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 6 

 

Internal Control in the Federal Government.”13

13 GAO’s Standards for Internal Control in the Federal Government (GAO-14-704G; September 2014)

provides the overall framework for establishing and maintaining effective internal control.

Treasury reaffirmed

the Uniform Guidance requirements in its RESTORE Act Financial 

Assistance Standard Terms and Conditions and Program-Specific 

Terms and Conditions and Treasury’s RESTORE Act Direct 

Component Guidance and Application to Receive Federal Financial 

Assistance. 

We concluded that Santa Rosa County had designed and 

implemented a system of internal control to administer Federal 

awards in accordance with applicable requirements. While we 

reached this conclusion, not all control activities were completed at 

the start of our audit in July 2015. That is, controls to administer 

grants in the areas of budgeting, cash management, 

disbursements, financial reporting, inventory management, 

procurement, program management, and performance monitoring

were in place and operating as evidenced in our process 

walkthroughs. However, certain control activities within these 

operational areas were not completed. Specifically, policies and 

procedures were not fully documented, and an entity-wide risk 

assessment had not been conducted.

It should be noted that at the start of our audit, no RESTORE Act 

grants had been awarded to Santa Rosa County. Furthermore, the 

Uniform Guidance became applicable for non-Federal entities in 

December 2014, and therefore, was being newly implemented. 

Nonetheless, we confirmed that Santa Rosa County completed the

following control activities prior to the completion of our audit. 

Documented Policies and Procedures

GAO’s Standards for Internal Control in the Federal Government

defines control activities as “policies, procedures, techniques, and 

mechanisms that enforce management’s directives to achieve the 

entity’s objectives and address related risks.” The standard also 

advises that documentation is a necessary part of an effective 

internal control system and provides a means to retain 

organizational knowledge and mitigate the risk of having that 

knowledge limited to a few personnel, as well as a means to 

 
Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 7 

 

communicate that knowledge as needed to external parties, such 

as external auditors. 

At the start of our audit in July 2015, Santa Rosa County had not 

documented policies and procedures governing Federal grants in 

the operational areas of cash management, financial reporting, 

program management, and performance monitoring. Policies and 

procedures needed to include grant reimbursements, cash advances 

and/or drawdowns for Federal grants; indirect cost recovery; grant 

monitoring; subrecipient monitoring to include a subrecipient risk 

assessment process; and information technology (IT) systems 

management. Santa Rosa County officials informed us that the 

county had not documented these policies and procedures because 

it lacked personnel to prepare the required standard operating 

procedures and related policy documents, and had not experienced 

personnel turnover or other issues in these areas, which would 

increase the urgency for such written guidance. In addition, a 

Santa Rosa County official informed us that policies and 

procedures for the subrecipient monitoring were not documented 

because the county had not had subrecipients for several years. 

The Grants and Special Projects Department developed the grants 

manual in March 2016. The grants manual addressed BOCC’s

procurement policy, Federal and State laws and regulations, and 

other relevant information pertaining to grants administration in 

Santa Rosa County. The grants manual also documented policies 

and procedures for the operational areas of cash management, 

financial reporting, program management, and performance

monitoring. We confirmed that the manual included procedures 

specific to grant reimbursements, cash advances and/or 

drawdowns for Federal grants, indirect cost recovery;14

14 In July 2016, Santa Rosa County management notified Treasury’s Office of Gulf Coast Restoration of 

its election to use the 10 percent de minimis indirect cost rate as allowed by the Uniform Guidance (2 

CFR Part 200.414, Indirect (F&A) Costs, section (f)).

grant 

monitoring; and subrecipient monitoring. Furthermore, a formalized 

risk assessment for evaluating subrecipient eligibility and 

 
Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 8 

 

monitoring performance was under development as noted in the

June 2017 Operational Self-Assessment.

15

15 Prior to receiving funding, Treasury requires applicants to complete an Operational Self-Assessment, 

which focuses on operational internal control areas and will be used, in part, to assist Treasury in 

determining an appropriate compliance monitoring protocol. 

 

Policies and procedures governing IT management are separate 

from the grants manual and are the responsibility of the Clerk of 

the Circuit Court’s IT Department. The Finance Department, within 

the Clerk of the Circuit Court, processes grant invoices in the 

financial applications on the Clerk of the Circuit Court’s servers. In 

December 2017, the IT Department documented the IT manual, 

which addressed access control, identification and authentication, 

physical security, and data security. 

Risk Assessment

GAO’s Standards for Internal Control in the Federal Government

states that “the risk assessment component of internal control is 

assessing the risks facing an entity as it seeks to achieve its 

objectives. The assessment provides the basis for developing 

appropriate risk responses. Management assesses the risks the 

entity faces from both external and internal sources.” 

At the start of our audit in July 2015, Santa Rosa County 

management had not performed an entity-wide risk assessment. 

According to management, it was unclear what the expectations 

were for risk assessments and management was not familiar with 

the requirements set forth in GAO’s Standards for Internal Control 

in the Federal Government. 

In August 2016, Santa Rosa County contracted a professional 

services firm to perform an enterprise-wide risk assessment, which 

was completed in April 2017. We found the assessment to be 

comprehensive and it included matters consistent with those 

identified in our audit, such as the lack of an enterprise-wide risk 

assessment and lack of formal IT related policies and procedures at 

that time. 

 
Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 9 

 

Conclusion

Prior to the completion of our audit, we confirmed that Santa Rosa 

County’s grants manual and IT manual sufficiently documented 

controls over Federal awards and the supporting IT systems and 

applications to process them. Furthermore, the entity-wide risk 

assessment identified relevant risks consistent with our earlier 

conclusions. As such, we make no recommendation in this report.

* * * * * 

We would like to extend our appreciation for the cooperation and 

courtesies extended to our staff during the audit. Major 

contributors to this report are listed in appendix 5. A distribution 

list for this report is provided as appendix 6. If you have any 

questions, please contact me at (202) 927-8782 or Eleanor Kang, 

Audit Manager, at (202) 927-8127. 

/s/

Cecilia K. Howland

Director, Gulf Coast Restoration Audits 
Appendix 1

Objective, Scope, and Methodology 

Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 10 

 

As part of our oversight of programs, projects, and activities 

authorized by the Resources and Ecosystems Sustainability, Tourist 

Opportunities, and Revived Economies of the Gulf Coast States Act 

of 2012 (RESTORE Act), we initiated an audit of Santa Rosa 

County, Florida’s (Santa Rosa County) internal control to administer 

RESTORE Act grants in June 2015. The objective of our audit was 

to assess Santa Rosa County’s internal control over the 

administration of Federal awards in accordance with Federal laws, 

regulations, and the Department of the Treasury’s (Treasury) grant 

application requirements.

The scope of our audit comprised Santa Rosa County’s internal 

control in place from September 2014 through December 2017 as 

it related to the administration of Federal awards. This included 

policies, procedures, and practices with respect to Santa Rosa 

County’s key controls over budgeting, cash management, 

disbursements, financial reporting, inventory management, 

procurement, program management and performance monitoring.

Awards of $108,000 for planning assistance (November 23, 2016) 

and $272,950 for the “Gulf Coast Discovery Center, Phase I” 

project (November 16, 2017) were not within the scope of this 

audit given the timing of these awards after the start of fieldwork. 

Testing of controls over Federal awards was based on nonRESTORE Act grants awarded to Santa Rosa County. 

We contracted with Williams, Adley and Company-DC LLP, a 

certified independent public accounting firm, to assist us with the 

audit. However, this report and the conclusion therein are the 

responsibility of the Treasury Office of Inspector General. As such, 

we take responsibility for all work performed on our behalf. 

To meet our audit objective, we performed the following 

procedures. 

• We reviewed applicable Federal laws, regulations, and 

procedures including:

 The RESTORE Act, Pub. L. 112-141, July 6, 2012; 

 Treasury, Regulations for the Gulf Coast Restoration 

Trust Fund Interim Final Rule, 31 CFR Part 34, 

October 14, 2014 and Regulations for the Gulf Coast 
Appendix 1

Objective, Scope, and Methodology 

Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 11 

 

Restoration Trust Fund Final Rule, 31 CFR Part 34, 

February 12, 2016; 

 Office of Management and Budget (OMB), Uniform 

Administrative Requirements, Cost Principles, and 

Audit Requirements for Federal Awards, 2 CFR Part 

200, December 26, 2014; 

 Treasury, Final Rule adopting Uniform Administrative 

Requirements, Cost Principles, and Audit 

Requirements for Federal Awards, 81 Fed. Reg. 4573; 

(codified at 2 CFR Part 1000, January 27, 2016); 

 Treasury, RESTORE Act Financial Assistance Standard 

Terms and Conditions and Program-Specific Terms 

and Conditions, January 2015; 

 Treasury, RESTORE Act Direct Component Guidance 

and Application to Receive Federal Financial 

Assistance, August 2014; and

 Government Accountability Office, Standards for 

Internal Control in the Federal Government (GAO-14-

704G; September 2014). 

• We reviewed relevant documents related to Santa Rosa 

County as follows: 

 Santa Rosa County Direct Component application 

package for Federal financial assistance;

 “United States Department of the Treasury Resources 

and Ecosystems Sustainability, Tourist Opportunities, 

and Revived Economies of the Gulf Coast States Act 

(RESTORE Act) Operational Self-Assessment (OSA)”

dated September 8, 2014, June 5, 2015, June 15, 

2016, and June 6, 2017; 

 Single Audit Report for Santa Rosa County, Florida for 

fiscal years ending September 30, 2013 through 

September 30, 2016. 

 “Enterprise Wide Risk Assessment Results for Santa 

Rosa County Board of County Commissioners,” 

April 15, 2017;

 Santa Rosa County’s election of the indirect cost rate

memorandum, July 13, 2016; and

 Treasury Office of Gulf Coast Restoration’s letter of 

acceptance of Santa Rosa County’s Multiyear 

Implementation Plan, May 16, 2017. 
Appendix 1

Objective, Scope, and Methodology 

Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 12 

 

• We reviewed Santa Rosa County’s policies and procedures 

as follows: 

 Santa Rosa County, Florida Finance Department, 

Accounting Policies and Procedures Manual, updated 

June 16, 2015;

 Santa Rosa County Florida Grants Manual, March 24, 

2016;

 “Santa Rosa County Board of County Commissioners 

Employee Handbook 4th Edition (2012)”; 

 “Fund Accounting SunGard K-12 Education 

eFinancePLUS”, Version 5.0 (2012); 

 Santa Rosa County’s Procurement Policy (Ordinance 

85-29), October 10, 1985; 

 Santa Rosa County’s Procurement Policy (Ordinance 

90-04), February 22, 1990; 

 Santa Rosa County’s Procurement Policy (Ordinance 

2002-13), June 13, 2002; and

 Santa Rosa County Clerk of the Court IT 

Administrative Policy and Procedures Manual. 

• We performed walkthroughs of processes to identify controls 

over Federal awards for the purpose of assessing Santa Rosa 

County’s internal control. During the walkthroughs, we 

reviewed documentation to determine if processes and 

controls were designed and implemented in accordance with 

OMB’s Uniform Administrative Requirements, Cost 

Principles, and Audit Requirements for Federal Awards. We 

performed walkthroughs in operational areas as follows:

 budgeting;

 cash management;

 disbursements;

 financial reporting; 

 inventory management

 procurement; 

 program management; and 

 performance monitoring. 

• We interviewed key Santa Rosa County officials and staff as 

follows:

 Grants and Special Programs Director, 
Appendix 1

Objective, Scope, and Methodology 

Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 13 

 

 Grants and Special Programs Manager, 

 Finance Director, 

 Financial Services Administrator,

 Budget Director; 

 Human Resources Director,

 Information Technology Director for the Clerk of the 

Circuit Court,

 Information Technology staff for Board of County 

Commissioners, 

 County Attorney, 

 Internal Auditor, 

 County Lead Engineer, and

 Director of Public Works.

We conducted our fieldwork between June 2015 and December 

2017, at the Santa Rosa County office in Milton, Florida, and at 

the Treasury Office of Inspector General office in Washington, D.C.

We conducted this performance audit in accordance with generally 

accepted government auditing standards. Those standards require 

that we plan and perform the audit to obtain sufficient, appropriate 

evidence to provide a reasonable basis for our findings and 

conclusions based on our audit objectives. We believe that the 

evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.
Appendix 2

Santa Rosa County Management Response

Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 14 

 
Appendix 3

Treasury Management Response

Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 15 

 
Appendix 4

Background on the Gulf Coast Restoration Trust Fund 

Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 16 

 

The Resources and Ecosystems Sustainability, Tourist 

Opportunities, and Revived Economies of the Gulf Coast States Act 

of 2012 (RESTORE Act) established the Gulf Coast Restoration 

Trust Fund (Trust Fund) within the Department of the Treasury 

(Treasury) to provide funds for environmental and economic 

restoration of the Gulf Coast region that was damaged by the 2010 

Deepwater Horizon oil spill. Deposits into the Trust Fund will 

comprise 80 percent of all civil and administrative penalties related 

to Deepwater Horizon paid under the Federal Water Pollution 

Control Act (Clean Water Act) after July 6, 2012. 

Fund Sources

Approximately $5.3 billion has been designated for the Trust Fund 

resulting from settlement agreements between the U.S. 

Department of Justice and the following parties:

• approximately $4.4 billion plus interest from BP Exploration & 

Production Inc.16

16 A $20.8 billion civil settlement between the Department of Justice and BP Exploration & Production 

Inc. was approved on April 4, 2016. Of this amount, $4.4 billion will be deposited into the Trust Fund 

over 15 years. BP Exploration & Production Inc. made the first Clean Water Act penalty payment to the 

Department of Justice on April 3, 2017, and 80 percent of that payment, or approximately 

$303 million, was deposited into the Trust Fund on April 10, 2017. A second payment of approximately 

$152 million was deposited into the Trust Fund on April 9, 2018. 

• approximately $800 million plus interest from the Transocean 

defendants17

17 On February 19, 2013, the civil settlement between the Department of Justice and Transocean 

defendants (Transocean Deepwater Inc., Transocean Offshore Deepwater Drilling Inc., Transocean 

Holdings LLC, and Triton Asset Leasing GmbH) was approved. Among other things in the settlement, 

the Transocean defendants paid a $1 billion civil penalty plus interest in three installments. Of this 

amount, $800 million plus interest was transferred to the Trust Fund; the final amount was deposited in 

the Trust Fund in February 2015.

• approximately $127 million plus interest from Anadarko 

Petroleum Corporation18

18 On December 16, 2015, the civil settlement between the Department of Justice and Anadarko 

Petroleum Corporation was approved. Anadarko agreed to civil penalties of $159.5 million. Of this 

amount, approximately $127 million was deposited in the Trust Fund in March 2016. 

RESTORE Act Components

The RESTORE Act allocates monies from the Trust Fund into the 

following five components.

 
Appendix 4

Background on the Gulf Coast Restoration Trust Fund 

Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 17 

 

• Direct Component – Treasury Administered

 35 percent is to be equally divided among the five 

Gulf Coast States for ecosystem restoration, 

economic development, and tourism promotion 

accordingly:

• Louisiana – 30 percent to the coastal 

parishes based on an allocation formula and

70 percent to the state;

• Florida – 75 percent to the counties most 

affected by the oil spill and 25 percent to 

the other counties based on an allocation 

formula;

• Mississippi – 100 percent to the Department 

of Environmental Equality;

• Alabama – 100 percent to the Alabama Gulf 

Coast Recovery Council; and

• Texas – 100 percent to the Texas 

Governor’s Office; 

• Comprehensive Plan Component – Gulf Coast Ecosystem 

Restoration Council Administered

 30 percent plus 50 percent of interest earned from 

Trust Fund investments is to be used for 

restoration activities under the Comprehensive 

Plan; 

• Spill Impact Component – Gulf Coast Ecosystem 

Restoration Council Administered

 30 percent is to be divided among the five Gulf 

Coast States according to a formula to implement 

State Expenditure Plans, which require approval by 

the Council;

• National Oceanic and Atmospheric Administration’s 

RESTORE Act Science Program – National Oceanic and 

Atmospheric Administration Administered

 2.5 percent plus 25 percent of interest earned from 

Trust Fund investments is to be used for a science, 

observation, monitoring, and technology program; 

and
Appendix 4

Background on the Gulf Coast Restoration Trust Fund 

Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 18 

 

• Centers of Excellence Research Grants Program – 

Treasury Administered

 2.5 percent plus 25 percent of interest earned from 

Trust Fund investments is to be used for research 

on the Gulf Coast Region.

Availability for Santa Rosa County

Santa Rosa County is estimated to receive $29.3 million based on

the Federal Government’s settlement with Transocean, Anadarko 

Petroleum Corporation, and BP Exploration & Production Inc. 

defendants. As of April 9, 2018, the Trust Fund had received 

approximately $1.4 billion, including related interest. Of that 

amount, approximately $7.6 million has been made available to 

Santa Rosa County under the Direct Component.19

19 Current Trust Fund allocations, including funds available and funds obligated or transferred by 

RESTORE Act component are publicly available on the U.S. Treasury Restore Act homepage: 

https://www.treasury.gov/services/restore-act/Pages/home.aspx

 
Appendix 5

Major Contributors to This Report

Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 19 

 

Eleanor P. Kang, Audit Manager

Lawrence Gonzalez, Auditor-in-Charge

Rolake N. Akinyeye, Auditor

Kevin A. Guishard, Referencer
Appendix 6

Report Distribution

Santa Rosa County’s Internal Control over Federal Awards (OIG-18-050) Page 20 

 

 Department of the Treasury

Counselor to the Secretary

Under Secretary for Domestic Finance

Fiscal Assistant Secretary

Deputy Assistant Secretary, Fiscal Operations and Policy

Director, Office of Grants and Asset Management

Director, Office of Gulf Coast Restoration

Office of the Deputy Chief Financial Officer, Risk and Control

Group

Director of Strategic Planning and Performance Improvement

 Office of Management and Budget

OIG Budget Examiner

 

 State of Florida 

Chair of the Board of County Commissioners 

Auditor General, State of Florida

 
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Treasury OIG Website

Access Treasury OIG reports and other information online: 

http://www.treasury.gov/about/organizational-structure/ig/Pages/default.aspx

Report Waste, Fraud, and Abuse

OIG Hotline for Treasury Programs and Operations – Call toll free: 1-800-359-3898

Gulf Coast Restoration Hotline – Call toll free: 1-855-584.GULF (4853)

Email: Hotline@oig.treas.gov

Submit a complaint using our online form: 

https://www.treasury.gov/about/organizational-structure/ig/Pages/OigOnlineHotlineForm.aspx