Audit 290051

CRITERIA: 2022 Compliance Supplement, Assistance Listing 21.027 – Coronavirus State and Local Fiscal Recovery Funds, Section III – Compliance Requirements I(2) – Suspension and Debarment states the following: Prior to entering into subawards and contracts with award funds, recipients must verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded pursuant to 31 CFR section 19.300. The 2023 Compliance Supplement states the following: Non-federal entities and auditors should be aware that the Uniform Guidance also includes requirements for non-federal entities to have written policies or procedures supporting compliance with certain compliance requirements. The areas of procurement and subrecipient monitoring are examples of compliance requirements that contain such requirements. 2 CFR 200.319(d) The non-Federal entity must have written procedures for procurement transactions. These procedures must ensure that all solicitations: (1) Incorporate a clear and accurate description of the technical requirements for the material, product, or service to be procured. Such a description must not, in competitive procurements, contain features which unduly restrict competition. The description may include a statement of the qualitative nature of the material, product, or service to be procured and, when necessary, must set forth those minimum essential characteristics and standards to which it must conform if it is to satisfy its intended use. Detailed product specifications should be avoided if possible. When it is impractical or uneconomical to make a clear and accurate description of the technical requirements, a “brand name or equivalent” description may be used to define the performance or other salient requirements of procurement. The specific features of the named brand which must be met by offers must be clearly stated; and (2) Identify all requirements which the offerors must fulfill and all other factors to be used in evaluating bids or proposals. Debarment and Suspension (Executive Orders 12549 and 12689)—A contract award (see 2 CFR 180.220) must not be made to parties listed on the governmentwide exclusions in the System for Award Management (SAM), in accordance with the OMB guidelines at 2 CFR 180 that implement Executive Orders 12549 (3 CFR part 1986 Comp., p. 189) and 12689 (3 CFR part 1989 Comp., p. 235), “Debarment and Suspension.” SAM Exclusions contains the names of parties debarred, suspended, or otherwise excluded by agencies, as well as parties declared ineligible under statutory or regulatory authority other than Executive Order 12549. CONDITION: As part of our procedures on program expenditures we inquired of the comptroller and county engineer if the County performed the required suspension and debarment procedures as part of its contracting process to ensure that the bidders had not been suspended or debarred from performing work on federal contracts, and they stated that they had not performed those procedures as required by Title 2 of the U.S. Code of Federal Regulations. CAUSE: The County does not have written policies and procedures as required by various sections of Title 2 of the U.S. Code of Federal Regulations to ensure that it fulfills the compliance requirements for federal grants as listed in the Office of Management and Budget (OMB) Compliance Supplement. QUESTIONED COSTS: None PERSPECTIVE: One hundred percent test of federal expenditures. As part of our audit procedures, we performed additional procedures to determine that the successful bidder was not on the suspension/debarment list. EFFECT: Failure to develop and implement written policies and procedures by the County to ensure that it fulfills requirements contained in OMB’s Compliance Supplement could cause material noncompliance which could result in questioned costs that could require the County to reimburse federal funds due to noncompliance. It also could result in a loss or misappropriation of public assets. RECOMMENDATION: We recommend that the County develop and implement written internal control policies and procedures as required by Title 2 of the U.S. Code of Federal Regulations to ensure that it fulfills the requirements of the OMB’s Compliance Supplement.

CRITERIA: 2022 Compliance Supplement, Assistance Listing 21.027 – Coronavirus State and Local Fiscal Recovery Funds, Section III – Compliance Requirements I(2) – Suspension and Debarment states the following: Prior to entering into subawards and contracts with award funds, recipients must verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded pursuant to 31 CFR section 19.300. The 2023 Compliance Supplement states the following: Non-federal entities and auditors should be aware that the Uniform Guidance also includes requirements for non-federal entities to have written policies or procedures supporting compliance with certain compliance requirements. The areas of procurement and subrecipient monitoring are examples of compliance requirements that contain such requirements. 2 CFR 200.319(d) The non-Federal entity must have written procedures for procurement transactions. These procedures must ensure that all solicitations: (1) Incorporate a clear and accurate description of the technical requirements for the material, product, or service to be procured. Such a description must not, in competitive procurements, contain features which unduly restrict competition. The description may include a statement of the qualitative nature of the material, product, or service to be procured and, when necessary, must set forth those minimum essential characteristics and standards to which it must conform if it is to satisfy its intended use. Detailed product specifications should be avoided if possible. When it is impractical or uneconomical to make a clear and accurate description of the technical requirements, a “brand name or equivalent” description may be used to define the performance or other salient requirements of procurement. The specific features of the named brand which must be met by offers must be clearly stated; and (2) Identify all requirements which the offerors must fulfill and all other factors to be used in evaluating bids or proposals. Debarment and Suspension (Executive Orders 12549 and 12689)—A contract award (see 2 CFR 180.220) must not be made to parties listed on the governmentwide exclusions in the System for Award Management (SAM), in accordance with the OMB guidelines at 2 CFR 180 that implement Executive Orders 12549 (3 CFR part 1986 Comp., p. 189) and 12689 (3 CFR part 1989 Comp., p. 235), “Debarment and Suspension.” SAM Exclusions contains the names of parties debarred, suspended, or otherwise excluded by agencies, as well as parties declared ineligible under statutory or regulatory authority other than Executive Order 12549. CONDITION: As part of our procedures on program expenditures we inquired of the comptroller and county engineer if the County performed the required suspension and debarment procedures as part of its contracting process to ensure that the bidders had not been suspended or debarred from performing work on federal contracts, and they stated that they had not performed those procedures as required by Title 2 of the U.S. Code of Federal Regulations. CAUSE: The County does not have written policies and procedures as required by various sections of Title 2 of the U.S. Code of Federal Regulations to ensure that it fulfills the compliance requirements for federal grants as listed in the Office of Management and Budget (OMB) Compliance Supplement. QUESTIONED COSTS: None PERSPECTIVE: One hundred percent test of federal expenditures. As part of our audit procedures, we performed additional procedures to determine that the successful bidder was not on the suspension/debarment list. EFFECT: Failure to develop and implement written policies and procedures by the County to ensure that it fulfills requirements contained in OMB’s Compliance Supplement could cause material noncompliance which could result in questioned costs that could require the County to reimburse federal funds due to noncompliance. It also could result in a loss or misappropriation of public assets. RECOMMENDATION: We recommend that the County develop and implement written internal control policies and procedures as required by Title 2 of the U.S. Code of Federal Regulations to ensure that it fulfills the requirements of the OMB’s Compliance Supplement.