Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.
Assistance Listing Number, Federal Agency, and Program Name - 20.507 and 20.526, U.S. Department of Transportation, Federal Transit Cluster, 20.509, Formula Grants for Rural Areas and Tribal Transit
State Program: Program Section 5307 Urbanized Area Formula Program
Federal Award Identification Number and Year - TX 2023 111, TX 2024 017, TX 2021 017, TX 2022 065, TX 2024 018, 5539 R 2022 HCTD 00027, TX 2020 031, 5311 2020 HCTD 00035, 5311 2022 HCTD 00096, 5311 2023 HCTD 00034
State Award Idenitification Number and Year:STATE U 2023 HCTD 00101, STATE U 2022 HCTD 00160, STATE U 2023 HCTD 00102, and STATE U 2022 HCTD 00159
Pass through Entity - Texas Department of Transportation
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - 2 CFR 200.320 and 200.324 outline the auditee responsibility to utilize the appropriate procurement method and comply with all related requirements of that selected procurement methodology. Also, 2 CFR 180.300 outlines the auditee responsibility related to suspension and debarment requirements for vendors with whom an entity contracts.
Condition - HCTD did not have sufficient controls in place to ensure compliance with its procurement policy and that appropriate documentation is retained regarding the procurement methodology chosen and support for compliance with the suspension and debarment requirements.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Of the sample of 38 contracts procured this year that we selected for testing, 7 did not have the required support for the procurement method selected based on federal and state guidelines and HCTD's procurement policy, and none of the 3 contracts selected for suspension and debarment testing had the required support retained.
Cause and Effect - HCTD did not retain support to show it obtained price quotes, as required by the small purchases provision; had the appropriate rationale, as required by the noncompetitive solicitation provision; or had support for proposals submitted, as required by the purchases over $250,000 provision. Support was not retained for 7 of the 24 samples selected during procurement testing; therefore, procurement methodology was not supported. Additionally, none of the 3 samples selected for suspension and debarment testing had the required support retained.
Recommendation - We recommend HCTD implement internal control procedures to ensure that procurement policy is followed and the proper documentation is kept in the procurement files to support any and all procurement decisions in accordance with the purchasing policy and federal and state regulations.
Views of Responsible Officials and Corrective Action Plan - HCTD agrees with this finding and has begun implementing the corrective action as follows. Procurement support is currently provided to HCTD through a contract with Hendrickson Transportation Group. This contract began in January 2024. Under this contract, the Procurement Policies and Procedures Manual and Disadvantaged Business Enterprise (DBE) Program are being updated, procurement forms will be created, and training for HCTD staff will be conducted.