Audit 343795

Federal agency: U.S. Department of Treasury Pass-through entity: Oregon Department of Administrative Services Federal program: 21.027 COVID-19 Coronavirus State and Local Fiscal Recovery Funds Criteria: When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA) and available at SAM.gov, (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300). Per 2 CFR 200.303, a non-Federal entity must “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.” Condition: The City did not verify that its vendors were not suspended or debarred or otherwise excluded from participating in a covered transaction. A material weakness in controls over compliance with procurement requirements was identified. Cause: The City did not appear to be aware of this compliance requirement. Effect or potential effect: Prior to entering into a covered transaction, the City did not verify that its vendors were not suspended or debarred or otherwise excluded from participating in the transaction. Questioned Costs: None noted. Context: Of a population of 3 contracts, 2 sampled contracts did not have documentation that the City verified the vendor was not suspended or debarred or otherwise excluded from participating in a covered transaction. Recommendation: The City should implement controls to ensure it verifies that its vendors are not suspended or debarred or otherwise excluded prior to entering into a covered transaction. Views of responsible officials: The City understands and concurs with the finding and recommendation.

Finding 2024-005 Federal agency: U.S. Department of Treasury Pass-through entity: Oregon Department of Administrative Services Federal program: 21.027 COVID-19 Coronavirus State and Local Fiscal Recovery Funds Criteria: All metropolitan cities and counties with a population below 250,000 residents that are allocated less than $10 million in SLFRF funding are required to submit annual reports which cover one calendar year. Condition: The City’s Finance Department did not review the annual report prepared prior to submission to the U.S. Department of Treasury. A material weakness in controls over compliance with reporting requirements was identified. Cause: This report lacked Finance Department review prior to its submission. Effect or potential effect: Without adequate internal controls over annual reporting to the U.S. Department of Treasury, the City could incorrectly report expenditures or report them for an incorrect period. Questioned Costs: None noted. Context: Of a population of 1 annual report, 1 annual report did not have documentation that the City reviewed it prior to submission to the Treasury Department. Recommendation: The City should implement controls to ensure annual reports are reviewed prior to submission to the Treasury Department. Views of responsible officials:

Federal agency: U.S. Department of Treasury Pass-through entity: Oregon Department of Administrative Services Federal program: 21.027 COVID-19 Coronavirus State and Local Fiscal Recovery Funds Criteria: When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA) and available at SAM.gov, (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300). Per 2 CFR 200.303, a non-Federal entity must “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.” Condition: The City did not verify that its vendors were not suspended or debarred or otherwise excluded from participating in a covered transaction. A material weakness in controls over compliance with procurement requirements was identified. Cause: The City did not appear to be aware of this compliance requirement. Effect or potential effect: Prior to entering into a covered transaction, the City did not verify that its vendors were not suspended or debarred or otherwise excluded from participating in the transaction. Questioned Costs: None noted. Context: Of a population of 3 contracts, 2 sampled contracts did not have documentation that the City verified the vendor was not suspended or debarred or otherwise excluded from participating in a covered transaction. Recommendation: The City should implement controls to ensure it verifies that its vendors are not suspended or debarred or otherwise excluded prior to entering into a covered transaction. Views of responsible officials: The City understands and concurs with the finding and recommendation.

Finding 2024-005 Federal agency: U.S. Department of Treasury Pass-through entity: Oregon Department of Administrative Services Federal program: 21.027 COVID-19 Coronavirus State and Local Fiscal Recovery Funds Criteria: All metropolitan cities and counties with a population below 250,000 residents that are allocated less than $10 million in SLFRF funding are required to submit annual reports which cover one calendar year. Condition: The City’s Finance Department did not review the annual report prepared prior to submission to the U.S. Department of Treasury. A material weakness in controls over compliance with reporting requirements was identified. Cause: This report lacked Finance Department review prior to its submission. Effect or potential effect: Without adequate internal controls over annual reporting to the U.S. Department of Treasury, the City could incorrectly report expenditures or report them for an incorrect period. Questioned Costs: None noted. Context: Of a population of 1 annual report, 1 annual report did not have documentation that the City reviewed it prior to submission to the Treasury Department. Recommendation: The City should implement controls to ensure annual reports are reviewed prior to submission to the Treasury Department. Views of responsible officials: