2 CFR 1200.10 gives regulatory effect to 2 CFR 180.305 which provides that participants are prohibited from entering into a covered transaction with parties that are excluded or disqualified and 2 CFR 180.315 prohibits participants from entering into covered transactions with parties whose principals are excluded or disqualified, unless the Federal agency responsible for the transaction grants an exception under 2 CFR § 180.135, or unless the participants has obtained an exception under the disqualifying statute, Executive order, or regulation.
2 CFR 1200.10 gives regulatory effect to 2 CFR 180.200 identifies “covered transactions” as non-procurement or procurement transactions subject to the prohibitions of 2 CFR § 180 subpart B, and may be a transaction at the primary tier, between a Federal agency and a person; or at the lower tier, between a participant in a covered transaction and another person. Under 2 CFR § 180.220, procurement contracts for goods and services awarded by a participant in a non-procurement transaction (e.g., grant or cooperative agreement) are covered transactions if the contracts are expected to equal or exceed $25,000 or meet certain other specified criteria. All non-procurement transactions (i.e., sub-awards to subrecipients), irrespective of award amount, are considered covered transactions, unless exempt under 2 CFR § 180.215.
2 CFR 180.330 requires that before a participant enters into a covered transaction with another party, the participant must verify that the party the participant is seeking to do business with is not excluded or disqualified. This verification may be accomplished by checking SAM exclusions (https://sam.gov); collecting a certification from the entity, or adding a clause or condition to the covered transactions with that entity.
Additionally, the County established the "Federal Procurement Policy" through Resolution # 2018-868 which states “sub awards and contract will not be permitted with parties that are debarred, suspended or otherwise excluded from or ineligible for participation in federal assistance programs or activities. Departmental Fiscal Supervisors are responsible for checking the Excluded Parties List System (EPLS) website, also known as the Debarred Contractors List prior to the approval of federal sub-awards or contacts of any amount or purchased of $50,000 or higher of federal awards.”
The County did not have proper internal controls in place to help verify that all entities, with whom the County had entered into covered transactions, had not been suspended or debarred. During testing of nonpayroll disbursements for AL # 20.205 Highway Planning and Construction Program, we noted for all procurement transactions tested with a payment to a vendor of more than $25,000, there was no evidence the County checked the SAM exclusions, collected a certification from the entity, or added a clause or condition to the covered transaction with the vendor. Due to the deficient internal control structure, the required verification was not completed for the covered transaction in the AL # 20.205 Highway Planning and Construction Program during the fiscal year ended December 31, 2023. Failing to have the appropriate controls in place may result in vendors receiving federal funds that are suspended or debarred.
Prior to contracting with vendors that will be paid with federal funds, the County should verify the vendor is not suspended or debarred by checking the SAM exclusions, collecting a certification from the vendor, or adding a clause or condition to the covered transaction with the vendor. In addition, the County should amend their policy to ensure the dollar threshold agrees to the CFR.
2 CFR 1201.1 gives regulatory effect to 2 CFR §200.320 that states that the non-Federal entity must have and use documented procurement procedures, consistent with the standards of 2 CFR §200.320, 200.317, 200.318, and 200.319. Furthermore, 2 CFR §200.320(a)(2) states that "small purchases are the acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity."
Additionally, the County established the "Federal Procurement Policy" through Resolution # 2018-868 which states "for all procurements of $15,000 and greater, the purchaser should obtain documentation verifying that the purchase price is fair and reasonable. Price analysis and cost analysis are the two primary techniques used to accomplish this purpose.
1. Price Analysis: Comparison of prices of multiple bids or information from other sources, such as established catalog or market prices or prices for similar past purchases.
2. Cost Analysis: Evaluation of the separate elements (e.g., labor, materials, etc.) that make up a contractor's total cost proposal or price (for both new contracts and modifications) to determine if they are allowable, directly related to. the requirement and reasonable for the value received.
A price analysis should always be performed and documented; under certain circumstances, while a cost analysis also needs to be performed and documented (cost analysis is always required if payment is based in whole or in part on reimbursement of costs, and it may also be required for other contract types when there is not adequate price competition).
The County did not follow their established policy which results in errors noted during testing of federal procurement requirements. During testing of the 2023 AL # 21.027 Coronavirus State and Local Fiscal Recovery Funds, for one of six procurements selected for testing (17%), which exceeded the micro-purchase threshold but did not exceed the small purchase threshold, the County could not provide documentation supporting that they obtained price or rate quotations from an adequate number of qualified sources.
Failure to follow the County's internal policies and failure to adhere to the requirements of 2 CFR §200.320 could result in unallowable purchases, misuse of public funds, or questioned costs related to federal monies.
The County should ensure they are following both their internal policies and Federal formal procurement methods when purchases fall within the small purchase threshold.
2 CFR 1201.1 gives regulatory effect to 2 CFR §200.320 that states that the non-Federal entity must have and use documented procurement procedures, consistent with the standards of 2 CFR §200.320, 200.317, 200.318, and 200.319. Furthermore, 2 CFR §200.320(a)(2) states that "small purchases are the acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity."
Additionally, the County established the "Federal Procurement Policy" through Resolution # 2018-868 which states "for all procurements of $15,000 and greater, the purchaser should obtain documentation verifying that the purchase price is fair and reasonable. Price analysis and cost analysis are the two primary techniques used to accomplish this purpose.
1. Price Analysis: Comparison of prices of multiple bids or information from other sources, such as established catalog or market prices or prices for similar past purchases.
2. Cost Analysis: Evaluation of the separate elements (e.g., labor, materials, etc.) that make up a contractor's total cost proposal or price (for both new contracts and modifications) to determine if they are allowable, directly related to. the requirement and reasonable for the value received.
A price analysis should always be performed and documented; under certain circumstances, while a cost analysis also needs to be performed and documented (cost analysis is always required if payment is based in whole or in part on reimbursement of costs, and it may also be required for other contract types when there is not adequate price competition).
The County did not follow their established policy which results in errors noted during testing of federal procurement requirements. During testing of the 2023 AL # 21.027 Coronavirus State and Local Fiscal Recovery Funds, for one of six procurements selected for testing (17%), which exceeded the micro-purchase threshold but did not exceed the small purchase threshold, the County could not provide documentation supporting that they obtained price or rate quotations from an adequate number of qualified sources.
Failure to follow the County's internal policies and failure to adhere to the requirements of 2 CFR §200.320 could result in unallowable purchases, misuse of public funds, or questioned costs related to federal monies.
The County should ensure they are following both their internal policies and Federal formal procurement methods when purchases fall within the small purchase threshold.
2 CFR 1200.10 gives regulatory effect to 2 CFR 180.305 which provides that participants are prohibited from entering into a covered transaction with parties that are excluded or disqualified and 2 CFR 180.315 prohibits participants from entering into covered transactions with parties whose principals are excluded or disqualified, unless the Federal agency responsible for the transaction grants an exception under 2 CFR § 180.135, or unless the participants has obtained an exception under the disqualifying statute, Executive order, or regulation.
2 CFR 1200.10 gives regulatory effect to 2 CFR 180.200 identifies “covered transactions” as non-procurement or procurement transactions subject to the prohibitions of 2 CFR § 180 subpart B, and may be a transaction at the primary tier, between a Federal agency and a person; or at the lower tier, between a participant in a covered transaction and another person. Under 2 CFR § 180.220, procurement contracts for goods and services awarded by a participant in a non-procurement transaction (e.g., grant or cooperative agreement) are covered transactions if the contracts are expected to equal or exceed $25,000 or meet certain other specified criteria. All non-procurement transactions (i.e., sub-awards to subrecipients), irrespective of award amount, are considered covered transactions, unless exempt under 2 CFR § 180.215.
2 CFR 180.330 requires that before a participant enters into a covered transaction with another party, the participant must verify that the party the participant is seeking to do business with is not excluded or disqualified. This verification may be accomplished by checking SAM exclusions (https://sam.gov); collecting a certification from the entity, or adding a clause or condition to the covered transactions with that entity.
Additionally, the County established the "Federal Procurement Policy" through Resolution # 2018-868 which states “sub awards and contract will not be permitted with parties that are debarred, suspended or otherwise excluded from or ineligible for participation in federal assistance programs or activities. Departmental Fiscal Supervisors are responsible for checking the Excluded Parties List System (EPLS) website, also known as the Debarred Contractors List prior to the approval of federal sub-awards or contacts of any amount or purchased of $50,000 or higher of federal awards.”
The County did not have proper internal controls in place to help verify that all entities, with whom the County had entered into covered transactions, had not been suspended or debarred. During testing of nonpayroll disbursements for AL # 20.205 Highway Planning and Construction Program, we noted for all procurement transactions tested with a payment to a vendor of more than $25,000, there was no evidence the County checked the SAM exclusions, collected a certification from the entity, or added a clause or condition to the covered transaction with the vendor. Due to the deficient internal control structure, the required verification was not completed for the covered transaction in the AL # 20.205 Highway Planning and Construction Program during the fiscal year ended December 31, 2023. Failing to have the appropriate controls in place may result in vendors receiving federal funds that are suspended or debarred.
Prior to contracting with vendors that will be paid with federal funds, the County should verify the vendor is not suspended or debarred by checking the SAM exclusions, collecting a certification from the vendor, or adding a clause or condition to the covered transaction with the vendor. In addition, the County should amend their policy to ensure the dollar threshold agrees to the CFR.
2 CFR 1201.1 gives regulatory effect to 2 CFR §200.320 that states that the non-Federal entity must have and use documented procurement procedures, consistent with the standards of 2 CFR §200.320, 200.317, 200.318, and 200.319. Furthermore, 2 CFR §200.320(a)(2) states that "small purchases are the acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity."
Additionally, the County established the "Federal Procurement Policy" through Resolution # 2018-868 which states "for all procurements of $15,000 and greater, the purchaser should obtain documentation verifying that the purchase price is fair and reasonable. Price analysis and cost analysis are the two primary techniques used to accomplish this purpose.
1. Price Analysis: Comparison of prices of multiple bids or information from other sources, such as established catalog or market prices or prices for similar past purchases.
2. Cost Analysis: Evaluation of the separate elements (e.g., labor, materials, etc.) that make up a contractor's total cost proposal or price (for both new contracts and modifications) to determine if they are allowable, directly related to. the requirement and reasonable for the value received.
A price analysis should always be performed and documented; under certain circumstances, while a cost analysis also needs to be performed and documented (cost analysis is always required if payment is based in whole or in part on reimbursement of costs, and it may also be required for other contract types when there is not adequate price competition).
The County did not follow their established policy which results in errors noted during testing of federal procurement requirements. During testing of the 2023 AL # 21.027 Coronavirus State and Local Fiscal Recovery Funds, for one of six procurements selected for testing (17%), which exceeded the micro-purchase threshold but did not exceed the small purchase threshold, the County could not provide documentation supporting that they obtained price or rate quotations from an adequate number of qualified sources.
Failure to follow the County's internal policies and failure to adhere to the requirements of 2 CFR §200.320 could result in unallowable purchases, misuse of public funds, or questioned costs related to federal monies.
The County should ensure they are following both their internal policies and Federal formal procurement methods when purchases fall within the small purchase threshold.
2 CFR 1201.1 gives regulatory effect to 2 CFR §200.320 that states that the non-Federal entity must have and use documented procurement procedures, consistent with the standards of 2 CFR §200.320, 200.317, 200.318, and 200.319. Furthermore, 2 CFR §200.320(a)(2) states that "small purchases are the acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity."
Additionally, the County established the "Federal Procurement Policy" through Resolution # 2018-868 which states "for all procurements of $15,000 and greater, the purchaser should obtain documentation verifying that the purchase price is fair and reasonable. Price analysis and cost analysis are the two primary techniques used to accomplish this purpose.
1. Price Analysis: Comparison of prices of multiple bids or information from other sources, such as established catalog or market prices or prices for similar past purchases.
2. Cost Analysis: Evaluation of the separate elements (e.g., labor, materials, etc.) that make up a contractor's total cost proposal or price (for both new contracts and modifications) to determine if they are allowable, directly related to. the requirement and reasonable for the value received.
A price analysis should always be performed and documented; under certain circumstances, while a cost analysis also needs to be performed and documented (cost analysis is always required if payment is based in whole or in part on reimbursement of costs, and it may also be required for other contract types when there is not adequate price competition).
The County did not follow their established policy which results in errors noted during testing of federal procurement requirements. During testing of the 2023 AL # 21.027 Coronavirus State and Local Fiscal Recovery Funds, for one of six procurements selected for testing (17%), which exceeded the micro-purchase threshold but did not exceed the small purchase threshold, the County could not provide documentation supporting that they obtained price or rate quotations from an adequate number of qualified sources.
Failure to follow the County's internal policies and failure to adhere to the requirements of 2 CFR §200.320 could result in unallowable purchases, misuse of public funds, or questioned costs related to federal monies.
The County should ensure they are following both their internal policies and Federal formal procurement methods when purchases fall within the small purchase threshold.