Audit 357507

Background The District participates in the Child Nutrition Cluster, which includes the National School Lunch, School Breakfast and Summer Food Service programs. These programs provide funding for free and reduced-price meals to students from low-income families. The District received $676,784 to administer these programs during the 2023-24 school year. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding program requirements and monitoring the effectiveness of established controls. State and federal requirements allow local entities to bypass normal procurement laws through a process commonly referred to as “piggybacking.” This process allows entities to purchase goods and services using contracts awarded by another government or group of governments via an interlocal agreement or cooperative. To comply with piggybacking requirements under state law, the entity must enter into this interlocal agreement before it purchases services or goods from the other entity’s bid contract. If the District uses such an agreement, federal regulations require it to confirm that the procurement methods the awarding agency followed met its own statutory procurement laws and followed regulations applicable to the District when selecting the contractor.   Federal requirements also prohibit recipients from contracting with or purchasing from parties suspended or debarred from doing business with the federal government. Whenever the District contracts or purchases goods and services that it expects to equal or exceed $25,000, paid all or in part with federal funds, it must verify that contractors have not been suspended, debarred or otherwise excluded from participating in federal programs. The District may verify this by obtaining a written certification from the contractor, adding a clause or condition into the contract that states the contractor is not suspended or debarred, or checking for exclusion records in the U.S. General Services Administration’s System for Award Management at SAM.gov. The District must very this before entering into the contract, and must maintain documentation to demonstrate compliance with this federal requirement.   Description of Condition Procurement Our audit found the District did not have a process to ensure it complied with procurement requirements when purchasing food. The District piggybacked onto a purchasing cooperative’s contract for food products; however, the District did not confirm that the procurement methods the awarding agency followed met its own statutory requirements before purchasing. Suspension and Debarment Our audit found the District did not have internal controls to verify the contractor it paid more than $25,000 in federal funds was not suspended or debarred from participating in federal programs. We consider these deficiencies in internal controls to be material weaknesses that led to material noncompliance. Cause of Condition District staff did not fully understand piggybacking requirements. Staff did not know they were required to obtain procurement documentation when they piggybacked on the awarding agency’s contract, to verify the process complied with the District’s federal procurement requirements. Also, they did not know they needed to verify the contractor was not suspended or debarred before using the contract. Effect of Condition Procurement The District piggybacked on one contract without reviewing the bid documentation and spent $377,737 of federal funds to purchase food products. Without effective internal controls, the District cannot demonstrate it complied with federal procurement requirements, allowed for full and open competition,  and received the best price for the food products it purchased. Suspension and Debarment The District did not obtain a written certification from the contractor, insert a clause into the contract or check for exclusion records at SAM.gov to verify the contractor it paid $377,737 using federal funds was not suspended or debarred before contracting. We subsequently verified the contractor was not suspended or debarred.  Therefore, we are not questioning the costs. Recommendation We recommend the District strengthen internal controls to ensure it complies with applicable federal procurement requirements for purchases of goods and services and maintain documentation demonstrating compliance with this requirement. Further, we recommend the District strengthen internal controls to verify all contractors it pays $25,000 or more, all or in part with federal funds, are not suspended or debarred from participating in federal programs and maintain documentation demonstrating compliance with this requirement. District’s Response The District will designate the Food Service Director to provide the Finance Director with all Food Service contracts, and the Finance Director will check each applicable vendor’s status on the System for Award Management (SAM) at https://sam.gov prior to contract execution. The Finance Director will maintain a printout of the SAM.gov verification results in procurement records. The Finance Director will provide the Superintendent with a copy of the relevant contracts for her approval. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. Title 2 CFR Part 200, Uniform Guidance, section 320, Methods of procurement to be followed, establishes requirements for procuring with Federal funds by nonfederal entities. Title 2 CFR Part 180, OMB Guidelines to Agencies on Government wide Debarment and Suspension (Nonprocurement), establishes non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11.

Background The District participates in the Child Nutrition Cluster, which includes the National School Lunch, School Breakfast and Summer Food Service programs. These programs provide funding for free and reduced-price meals to students from low-income families. The District received $676,784 to administer these programs during the 2023-24 school year. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding program requirements and monitoring the effectiveness of established controls. State and federal requirements allow local entities to bypass normal procurement laws through a process commonly referred to as “piggybacking.” This process allows entities to purchase goods and services using contracts awarded by another government or group of governments via an interlocal agreement or cooperative. To comply with piggybacking requirements under state law, the entity must enter into this interlocal agreement before it purchases services or goods from the other entity’s bid contract. If the District uses such an agreement, federal regulations require it to confirm that the procurement methods the awarding agency followed met its own statutory procurement laws and followed regulations applicable to the District when selecting the contractor.   Federal requirements also prohibit recipients from contracting with or purchasing from parties suspended or debarred from doing business with the federal government. Whenever the District contracts or purchases goods and services that it expects to equal or exceed $25,000, paid all or in part with federal funds, it must verify that contractors have not been suspended, debarred or otherwise excluded from participating in federal programs. The District may verify this by obtaining a written certification from the contractor, adding a clause or condition into the contract that states the contractor is not suspended or debarred, or checking for exclusion records in the U.S. General Services Administration’s System for Award Management at SAM.gov. The District must very this before entering into the contract, and must maintain documentation to demonstrate compliance with this federal requirement.   Description of Condition Procurement Our audit found the District did not have a process to ensure it complied with procurement requirements when purchasing food. The District piggybacked onto a purchasing cooperative’s contract for food products; however, the District did not confirm that the procurement methods the awarding agency followed met its own statutory requirements before purchasing. Suspension and Debarment Our audit found the District did not have internal controls to verify the contractor it paid more than $25,000 in federal funds was not suspended or debarred from participating in federal programs. We consider these deficiencies in internal controls to be material weaknesses that led to material noncompliance. Cause of Condition District staff did not fully understand piggybacking requirements. Staff did not know they were required to obtain procurement documentation when they piggybacked on the awarding agency’s contract, to verify the process complied with the District’s federal procurement requirements. Also, they did not know they needed to verify the contractor was not suspended or debarred before using the contract. Effect of Condition Procurement The District piggybacked on one contract without reviewing the bid documentation and spent $377,737 of federal funds to purchase food products. Without effective internal controls, the District cannot demonstrate it complied with federal procurement requirements, allowed for full and open competition,  and received the best price for the food products it purchased. Suspension and Debarment The District did not obtain a written certification from the contractor, insert a clause into the contract or check for exclusion records at SAM.gov to verify the contractor it paid $377,737 using federal funds was not suspended or debarred before contracting. We subsequently verified the contractor was not suspended or debarred.  Therefore, we are not questioning the costs. Recommendation We recommend the District strengthen internal controls to ensure it complies with applicable federal procurement requirements for purchases of goods and services and maintain documentation demonstrating compliance with this requirement. Further, we recommend the District strengthen internal controls to verify all contractors it pays $25,000 or more, all or in part with federal funds, are not suspended or debarred from participating in federal programs and maintain documentation demonstrating compliance with this requirement. District’s Response The District will designate the Food Service Director to provide the Finance Director with all Food Service contracts, and the Finance Director will check each applicable vendor’s status on the System for Award Management (SAM) at https://sam.gov prior to contract execution. The Finance Director will maintain a printout of the SAM.gov verification results in procurement records. The Finance Director will provide the Superintendent with a copy of the relevant contracts for her approval. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. Title 2 CFR Part 200, Uniform Guidance, section 320, Methods of procurement to be followed, establishes requirements for procuring with Federal funds by nonfederal entities. Title 2 CFR Part 180, OMB Guidelines to Agencies on Government wide Debarment and Suspension (Nonprocurement), establishes non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11.

Background The District participates in the Child Nutrition Cluster, which includes the National School Lunch, School Breakfast and Summer Food Service programs. These programs provide funding for free and reduced-price meals to students from low-income families. The District received $676,784 to administer these programs during the 2023-24 school year. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding program requirements and monitoring the effectiveness of established controls. State and federal requirements allow local entities to bypass normal procurement laws through a process commonly referred to as “piggybacking.” This process allows entities to purchase goods and services using contracts awarded by another government or group of governments via an interlocal agreement or cooperative. To comply with piggybacking requirements under state law, the entity must enter into this interlocal agreement before it purchases services or goods from the other entity’s bid contract. If the District uses such an agreement, federal regulations require it to confirm that the procurement methods the awarding agency followed met its own statutory procurement laws and followed regulations applicable to the District when selecting the contractor.   Federal requirements also prohibit recipients from contracting with or purchasing from parties suspended or debarred from doing business with the federal government. Whenever the District contracts or purchases goods and services that it expects to equal or exceed $25,000, paid all or in part with federal funds, it must verify that contractors have not been suspended, debarred or otherwise excluded from participating in federal programs. The District may verify this by obtaining a written certification from the contractor, adding a clause or condition into the contract that states the contractor is not suspended or debarred, or checking for exclusion records in the U.S. General Services Administration’s System for Award Management at SAM.gov. The District must very this before entering into the contract, and must maintain documentation to demonstrate compliance with this federal requirement.   Description of Condition Procurement Our audit found the District did not have a process to ensure it complied with procurement requirements when purchasing food. The District piggybacked onto a purchasing cooperative’s contract for food products; however, the District did not confirm that the procurement methods the awarding agency followed met its own statutory requirements before purchasing. Suspension and Debarment Our audit found the District did not have internal controls to verify the contractor it paid more than $25,000 in federal funds was not suspended or debarred from participating in federal programs. We consider these deficiencies in internal controls to be material weaknesses that led to material noncompliance. Cause of Condition District staff did not fully understand piggybacking requirements. Staff did not know they were required to obtain procurement documentation when they piggybacked on the awarding agency’s contract, to verify the process complied with the District’s federal procurement requirements. Also, they did not know they needed to verify the contractor was not suspended or debarred before using the contract. Effect of Condition Procurement The District piggybacked on one contract without reviewing the bid documentation and spent $377,737 of federal funds to purchase food products. Without effective internal controls, the District cannot demonstrate it complied with federal procurement requirements, allowed for full and open competition,  and received the best price for the food products it purchased. Suspension and Debarment The District did not obtain a written certification from the contractor, insert a clause into the contract or check for exclusion records at SAM.gov to verify the contractor it paid $377,737 using federal funds was not suspended or debarred before contracting. We subsequently verified the contractor was not suspended or debarred.  Therefore, we are not questioning the costs. Recommendation We recommend the District strengthen internal controls to ensure it complies with applicable federal procurement requirements for purchases of goods and services and maintain documentation demonstrating compliance with this requirement. Further, we recommend the District strengthen internal controls to verify all contractors it pays $25,000 or more, all or in part with federal funds, are not suspended or debarred from participating in federal programs and maintain documentation demonstrating compliance with this requirement. District’s Response The District will designate the Food Service Director to provide the Finance Director with all Food Service contracts, and the Finance Director will check each applicable vendor’s status on the System for Award Management (SAM) at https://sam.gov prior to contract execution. The Finance Director will maintain a printout of the SAM.gov verification results in procurement records. The Finance Director will provide the Superintendent with a copy of the relevant contracts for her approval. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. Title 2 CFR Part 200, Uniform Guidance, section 320, Methods of procurement to be followed, establishes requirements for procuring with Federal funds by nonfederal entities. Title 2 CFR Part 180, OMB Guidelines to Agencies on Government wide Debarment and Suspension (Nonprocurement), establishes non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11.

Background The District participates in the Child Nutrition Cluster, which includes the National School Lunch, School Breakfast and Summer Food Service programs. These programs provide funding for free and reduced-price meals to students from low-income families. The District received $676,784 to administer these programs during the 2023-24 school year. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding program requirements and monitoring the effectiveness of established controls. State and federal requirements allow local entities to bypass normal procurement laws through a process commonly referred to as “piggybacking.” This process allows entities to purchase goods and services using contracts awarded by another government or group of governments via an interlocal agreement or cooperative. To comply with piggybacking requirements under state law, the entity must enter into this interlocal agreement before it purchases services or goods from the other entity’s bid contract. If the District uses such an agreement, federal regulations require it to confirm that the procurement methods the awarding agency followed met its own statutory procurement laws and followed regulations applicable to the District when selecting the contractor.   Federal requirements also prohibit recipients from contracting with or purchasing from parties suspended or debarred from doing business with the federal government. Whenever the District contracts or purchases goods and services that it expects to equal or exceed $25,000, paid all or in part with federal funds, it must verify that contractors have not been suspended, debarred or otherwise excluded from participating in federal programs. The District may verify this by obtaining a written certification from the contractor, adding a clause or condition into the contract that states the contractor is not suspended or debarred, or checking for exclusion records in the U.S. General Services Administration’s System for Award Management at SAM.gov. The District must very this before entering into the contract, and must maintain documentation to demonstrate compliance with this federal requirement.   Description of Condition Procurement Our audit found the District did not have a process to ensure it complied with procurement requirements when purchasing food. The District piggybacked onto a purchasing cooperative’s contract for food products; however, the District did not confirm that the procurement methods the awarding agency followed met its own statutory requirements before purchasing. Suspension and Debarment Our audit found the District did not have internal controls to verify the contractor it paid more than $25,000 in federal funds was not suspended or debarred from participating in federal programs. We consider these deficiencies in internal controls to be material weaknesses that led to material noncompliance. Cause of Condition District staff did not fully understand piggybacking requirements. Staff did not know they were required to obtain procurement documentation when they piggybacked on the awarding agency’s contract, to verify the process complied with the District’s federal procurement requirements. Also, they did not know they needed to verify the contractor was not suspended or debarred before using the contract. Effect of Condition Procurement The District piggybacked on one contract without reviewing the bid documentation and spent $377,737 of federal funds to purchase food products. Without effective internal controls, the District cannot demonstrate it complied with federal procurement requirements, allowed for full and open competition,  and received the best price for the food products it purchased. Suspension and Debarment The District did not obtain a written certification from the contractor, insert a clause into the contract or check for exclusion records at SAM.gov to verify the contractor it paid $377,737 using federal funds was not suspended or debarred before contracting. We subsequently verified the contractor was not suspended or debarred.  Therefore, we are not questioning the costs. Recommendation We recommend the District strengthen internal controls to ensure it complies with applicable federal procurement requirements for purchases of goods and services and maintain documentation demonstrating compliance with this requirement. Further, we recommend the District strengthen internal controls to verify all contractors it pays $25,000 or more, all or in part with federal funds, are not suspended or debarred from participating in federal programs and maintain documentation demonstrating compliance with this requirement. District’s Response The District will designate the Food Service Director to provide the Finance Director with all Food Service contracts, and the Finance Director will check each applicable vendor’s status on the System for Award Management (SAM) at https://sam.gov prior to contract execution. The Finance Director will maintain a printout of the SAM.gov verification results in procurement records. The Finance Director will provide the Superintendent with a copy of the relevant contracts for her approval. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. Title 2 CFR Part 200, Uniform Guidance, section 320, Methods of procurement to be followed, establishes requirements for procuring with Federal funds by nonfederal entities. Title 2 CFR Part 180, OMB Guidelines to Agencies on Government wide Debarment and Suspension (Nonprocurement), establishes non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11.

Background The District participates in the Child Nutrition Cluster, which includes the National School Lunch, School Breakfast and Summer Food Service programs. These programs provide funding for free and reduced-price meals to students from low-income families. The District received $676,784 to administer these programs during the 2023-24 school year. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding program requirements and monitoring the effectiveness of established controls. State and federal requirements allow local entities to bypass normal procurement laws through a process commonly referred to as “piggybacking.” This process allows entities to purchase goods and services using contracts awarded by another government or group of governments via an interlocal agreement or cooperative. To comply with piggybacking requirements under state law, the entity must enter into this interlocal agreement before it purchases services or goods from the other entity’s bid contract. If the District uses such an agreement, federal regulations require it to confirm that the procurement methods the awarding agency followed met its own statutory procurement laws and followed regulations applicable to the District when selecting the contractor.   Federal requirements also prohibit recipients from contracting with or purchasing from parties suspended or debarred from doing business with the federal government. Whenever the District contracts or purchases goods and services that it expects to equal or exceed $25,000, paid all or in part with federal funds, it must verify that contractors have not been suspended, debarred or otherwise excluded from participating in federal programs. The District may verify this by obtaining a written certification from the contractor, adding a clause or condition into the contract that states the contractor is not suspended or debarred, or checking for exclusion records in the U.S. General Services Administration’s System for Award Management at SAM.gov. The District must very this before entering into the contract, and must maintain documentation to demonstrate compliance with this federal requirement.   Description of Condition Procurement Our audit found the District did not have a process to ensure it complied with procurement requirements when purchasing food. The District piggybacked onto a purchasing cooperative’s contract for food products; however, the District did not confirm that the procurement methods the awarding agency followed met its own statutory requirements before purchasing. Suspension and Debarment Our audit found the District did not have internal controls to verify the contractor it paid more than $25,000 in federal funds was not suspended or debarred from participating in federal programs. We consider these deficiencies in internal controls to be material weaknesses that led to material noncompliance. Cause of Condition District staff did not fully understand piggybacking requirements. Staff did not know they were required to obtain procurement documentation when they piggybacked on the awarding agency’s contract, to verify the process complied with the District’s federal procurement requirements. Also, they did not know they needed to verify the contractor was not suspended or debarred before using the contract. Effect of Condition Procurement The District piggybacked on one contract without reviewing the bid documentation and spent $377,737 of federal funds to purchase food products. Without effective internal controls, the District cannot demonstrate it complied with federal procurement requirements, allowed for full and open competition,  and received the best price for the food products it purchased. Suspension and Debarment The District did not obtain a written certification from the contractor, insert a clause into the contract or check for exclusion records at SAM.gov to verify the contractor it paid $377,737 using federal funds was not suspended or debarred before contracting. We subsequently verified the contractor was not suspended or debarred.  Therefore, we are not questioning the costs. Recommendation We recommend the District strengthen internal controls to ensure it complies with applicable federal procurement requirements for purchases of goods and services and maintain documentation demonstrating compliance with this requirement. Further, we recommend the District strengthen internal controls to verify all contractors it pays $25,000 or more, all or in part with federal funds, are not suspended or debarred from participating in federal programs and maintain documentation demonstrating compliance with this requirement. District’s Response The District will designate the Food Service Director to provide the Finance Director with all Food Service contracts, and the Finance Director will check each applicable vendor’s status on the System for Award Management (SAM) at https://sam.gov prior to contract execution. The Finance Director will maintain a printout of the SAM.gov verification results in procurement records. The Finance Director will provide the Superintendent with a copy of the relevant contracts for her approval. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. Title 2 CFR Part 200, Uniform Guidance, section 320, Methods of procurement to be followed, establishes requirements for procuring with Federal funds by nonfederal entities. Title 2 CFR Part 180, OMB Guidelines to Agencies on Government wide Debarment and Suspension (Nonprocurement), establishes non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11.

Background The District participates in the Child Nutrition Cluster, which includes the National School Lunch, School Breakfast and Summer Food Service programs. These programs provide funding for free and reduced-price meals to students from low-income families. The District received $676,784 to administer these programs during the 2023-24 school year. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding program requirements and monitoring the effectiveness of established controls. State and federal requirements allow local entities to bypass normal procurement laws through a process commonly referred to as “piggybacking.” This process allows entities to purchase goods and services using contracts awarded by another government or group of governments via an interlocal agreement or cooperative. To comply with piggybacking requirements under state law, the entity must enter into this interlocal agreement before it purchases services or goods from the other entity’s bid contract. If the District uses such an agreement, federal regulations require it to confirm that the procurement methods the awarding agency followed met its own statutory procurement laws and followed regulations applicable to the District when selecting the contractor.   Federal requirements also prohibit recipients from contracting with or purchasing from parties suspended or debarred from doing business with the federal government. Whenever the District contracts or purchases goods and services that it expects to equal or exceed $25,000, paid all or in part with federal funds, it must verify that contractors have not been suspended, debarred or otherwise excluded from participating in federal programs. The District may verify this by obtaining a written certification from the contractor, adding a clause or condition into the contract that states the contractor is not suspended or debarred, or checking for exclusion records in the U.S. General Services Administration’s System for Award Management at SAM.gov. The District must very this before entering into the contract, and must maintain documentation to demonstrate compliance with this federal requirement.   Description of Condition Procurement Our audit found the District did not have a process to ensure it complied with procurement requirements when purchasing food. The District piggybacked onto a purchasing cooperative’s contract for food products; however, the District did not confirm that the procurement methods the awarding agency followed met its own statutory requirements before purchasing. Suspension and Debarment Our audit found the District did not have internal controls to verify the contractor it paid more than $25,000 in federal funds was not suspended or debarred from participating in federal programs. We consider these deficiencies in internal controls to be material weaknesses that led to material noncompliance. Cause of Condition District staff did not fully understand piggybacking requirements. Staff did not know they were required to obtain procurement documentation when they piggybacked on the awarding agency’s contract, to verify the process complied with the District’s federal procurement requirements. Also, they did not know they needed to verify the contractor was not suspended or debarred before using the contract. Effect of Condition Procurement The District piggybacked on one contract without reviewing the bid documentation and spent $377,737 of federal funds to purchase food products. Without effective internal controls, the District cannot demonstrate it complied with federal procurement requirements, allowed for full and open competition,  and received the best price for the food products it purchased. Suspension and Debarment The District did not obtain a written certification from the contractor, insert a clause into the contract or check for exclusion records at SAM.gov to verify the contractor it paid $377,737 using federal funds was not suspended or debarred before contracting. We subsequently verified the contractor was not suspended or debarred.  Therefore, we are not questioning the costs. Recommendation We recommend the District strengthen internal controls to ensure it complies with applicable federal procurement requirements for purchases of goods and services and maintain documentation demonstrating compliance with this requirement. Further, we recommend the District strengthen internal controls to verify all contractors it pays $25,000 or more, all or in part with federal funds, are not suspended or debarred from participating in federal programs and maintain documentation demonstrating compliance with this requirement. District’s Response The District will designate the Food Service Director to provide the Finance Director with all Food Service contracts, and the Finance Director will check each applicable vendor’s status on the System for Award Management (SAM) at https://sam.gov prior to contract execution. The Finance Director will maintain a printout of the SAM.gov verification results in procurement records. The Finance Director will provide the Superintendent with a copy of the relevant contracts for her approval. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. Title 2 CFR Part 200, Uniform Guidance, section 320, Methods of procurement to be followed, establishes requirements for procuring with Federal funds by nonfederal entities. Title 2 CFR Part 180, OMB Guidelines to Agencies on Government wide Debarment and Suspension (Nonprocurement), establishes non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11.

Background The District participates in the Child Nutrition Cluster, which includes the National School Lunch, School Breakfast and Summer Food Service programs. These programs provide funding for free and reduced-price meals to students from low-income families. The District received $676,784 to administer these programs during the 2023-24 school year. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding program requirements and monitoring the effectiveness of established controls. State and federal requirements allow local entities to bypass normal procurement laws through a process commonly referred to as “piggybacking.” This process allows entities to purchase goods and services using contracts awarded by another government or group of governments via an interlocal agreement or cooperative. To comply with piggybacking requirements under state law, the entity must enter into this interlocal agreement before it purchases services or goods from the other entity’s bid contract. If the District uses such an agreement, federal regulations require it to confirm that the procurement methods the awarding agency followed met its own statutory procurement laws and followed regulations applicable to the District when selecting the contractor.   Federal requirements also prohibit recipients from contracting with or purchasing from parties suspended or debarred from doing business with the federal government. Whenever the District contracts or purchases goods and services that it expects to equal or exceed $25,000, paid all or in part with federal funds, it must verify that contractors have not been suspended, debarred or otherwise excluded from participating in federal programs. The District may verify this by obtaining a written certification from the contractor, adding a clause or condition into the contract that states the contractor is not suspended or debarred, or checking for exclusion records in the U.S. General Services Administration’s System for Award Management at SAM.gov. The District must very this before entering into the contract, and must maintain documentation to demonstrate compliance with this federal requirement.   Description of Condition Procurement Our audit found the District did not have a process to ensure it complied with procurement requirements when purchasing food. The District piggybacked onto a purchasing cooperative’s contract for food products; however, the District did not confirm that the procurement methods the awarding agency followed met its own statutory requirements before purchasing. Suspension and Debarment Our audit found the District did not have internal controls to verify the contractor it paid more than $25,000 in federal funds was not suspended or debarred from participating in federal programs. We consider these deficiencies in internal controls to be material weaknesses that led to material noncompliance. Cause of Condition District staff did not fully understand piggybacking requirements. Staff did not know they were required to obtain procurement documentation when they piggybacked on the awarding agency’s contract, to verify the process complied with the District’s federal procurement requirements. Also, they did not know they needed to verify the contractor was not suspended or debarred before using the contract. Effect of Condition Procurement The District piggybacked on one contract without reviewing the bid documentation and spent $377,737 of federal funds to purchase food products. Without effective internal controls, the District cannot demonstrate it complied with federal procurement requirements, allowed for full and open competition,  and received the best price for the food products it purchased. Suspension and Debarment The District did not obtain a written certification from the contractor, insert a clause into the contract or check for exclusion records at SAM.gov to verify the contractor it paid $377,737 using federal funds was not suspended or debarred before contracting. We subsequently verified the contractor was not suspended or debarred.  Therefore, we are not questioning the costs. Recommendation We recommend the District strengthen internal controls to ensure it complies with applicable federal procurement requirements for purchases of goods and services and maintain documentation demonstrating compliance with this requirement. Further, we recommend the District strengthen internal controls to verify all contractors it pays $25,000 or more, all or in part with federal funds, are not suspended or debarred from participating in federal programs and maintain documentation demonstrating compliance with this requirement. District’s Response The District will designate the Food Service Director to provide the Finance Director with all Food Service contracts, and the Finance Director will check each applicable vendor’s status on the System for Award Management (SAM) at https://sam.gov prior to contract execution. The Finance Director will maintain a printout of the SAM.gov verification results in procurement records. The Finance Director will provide the Superintendent with a copy of the relevant contracts for her approval. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. Title 2 CFR Part 200, Uniform Guidance, section 320, Methods of procurement to be followed, establishes requirements for procuring with Federal funds by nonfederal entities. Title 2 CFR Part 180, OMB Guidelines to Agencies on Government wide Debarment and Suspension (Nonprocurement), establishes non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11.

Background The District participates in the Child Nutrition Cluster, which includes the National School Lunch, School Breakfast and Summer Food Service programs. These programs provide funding for free and reduced-price meals to students from low-income families. The District received $676,784 to administer these programs during the 2023-24 school year. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding program requirements and monitoring the effectiveness of established controls. State and federal requirements allow local entities to bypass normal procurement laws through a process commonly referred to as “piggybacking.” This process allows entities to purchase goods and services using contracts awarded by another government or group of governments via an interlocal agreement or cooperative. To comply with piggybacking requirements under state law, the entity must enter into this interlocal agreement before it purchases services or goods from the other entity’s bid contract. If the District uses such an agreement, federal regulations require it to confirm that the procurement methods the awarding agency followed met its own statutory procurement laws and followed regulations applicable to the District when selecting the contractor.   Federal requirements also prohibit recipients from contracting with or purchasing from parties suspended or debarred from doing business with the federal government. Whenever the District contracts or purchases goods and services that it expects to equal or exceed $25,000, paid all or in part with federal funds, it must verify that contractors have not been suspended, debarred or otherwise excluded from participating in federal programs. The District may verify this by obtaining a written certification from the contractor, adding a clause or condition into the contract that states the contractor is not suspended or debarred, or checking for exclusion records in the U.S. General Services Administration’s System for Award Management at SAM.gov. The District must very this before entering into the contract, and must maintain documentation to demonstrate compliance with this federal requirement.   Description of Condition Procurement Our audit found the District did not have a process to ensure it complied with procurement requirements when purchasing food. The District piggybacked onto a purchasing cooperative’s contract for food products; however, the District did not confirm that the procurement methods the awarding agency followed met its own statutory requirements before purchasing. Suspension and Debarment Our audit found the District did not have internal controls to verify the contractor it paid more than $25,000 in federal funds was not suspended or debarred from participating in federal programs. We consider these deficiencies in internal controls to be material weaknesses that led to material noncompliance. Cause of Condition District staff did not fully understand piggybacking requirements. Staff did not know they were required to obtain procurement documentation when they piggybacked on the awarding agency’s contract, to verify the process complied with the District’s federal procurement requirements. Also, they did not know they needed to verify the contractor was not suspended or debarred before using the contract. Effect of Condition Procurement The District piggybacked on one contract without reviewing the bid documentation and spent $377,737 of federal funds to purchase food products. Without effective internal controls, the District cannot demonstrate it complied with federal procurement requirements, allowed for full and open competition,  and received the best price for the food products it purchased. Suspension and Debarment The District did not obtain a written certification from the contractor, insert a clause into the contract or check for exclusion records at SAM.gov to verify the contractor it paid $377,737 using federal funds was not suspended or debarred before contracting. We subsequently verified the contractor was not suspended or debarred.  Therefore, we are not questioning the costs. Recommendation We recommend the District strengthen internal controls to ensure it complies with applicable federal procurement requirements for purchases of goods and services and maintain documentation demonstrating compliance with this requirement. Further, we recommend the District strengthen internal controls to verify all contractors it pays $25,000 or more, all or in part with federal funds, are not suspended or debarred from participating in federal programs and maintain documentation demonstrating compliance with this requirement. District’s Response The District will designate the Food Service Director to provide the Finance Director with all Food Service contracts, and the Finance Director will check each applicable vendor’s status on the System for Award Management (SAM) at https://sam.gov prior to contract execution. The Finance Director will maintain a printout of the SAM.gov verification results in procurement records. The Finance Director will provide the Superintendent with a copy of the relevant contracts for her approval. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. Title 2 CFR Part 200, Uniform Guidance, section 320, Methods of procurement to be followed, establishes requirements for procuring with Federal funds by nonfederal entities. Title 2 CFR Part 180, OMB Guidelines to Agencies on Government wide Debarment and Suspension (Nonprocurement), establishes non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11.

Background The District participates in the Child Nutrition Cluster, which includes the National School Lunch, School Breakfast and Summer Food Service programs. These programs provide funding for free and reduced-price meals to students from low-income families. The District received $676,784 to administer these programs during the 2023-24 school year. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding program requirements and monitoring the effectiveness of established controls. State and federal requirements allow local entities to bypass normal procurement laws through a process commonly referred to as “piggybacking.” This process allows entities to purchase goods and services using contracts awarded by another government or group of governments via an interlocal agreement or cooperative. To comply with piggybacking requirements under state law, the entity must enter into this interlocal agreement before it purchases services or goods from the other entity’s bid contract. If the District uses such an agreement, federal regulations require it to confirm that the procurement methods the awarding agency followed met its own statutory procurement laws and followed regulations applicable to the District when selecting the contractor.   Federal requirements also prohibit recipients from contracting with or purchasing from parties suspended or debarred from doing business with the federal government. Whenever the District contracts or purchases goods and services that it expects to equal or exceed $25,000, paid all or in part with federal funds, it must verify that contractors have not been suspended, debarred or otherwise excluded from participating in federal programs. The District may verify this by obtaining a written certification from the contractor, adding a clause or condition into the contract that states the contractor is not suspended or debarred, or checking for exclusion records in the U.S. General Services Administration’s System for Award Management at SAM.gov. The District must very this before entering into the contract, and must maintain documentation to demonstrate compliance with this federal requirement.   Description of Condition Procurement Our audit found the District did not have a process to ensure it complied with procurement requirements when purchasing food. The District piggybacked onto a purchasing cooperative’s contract for food products; however, the District did not confirm that the procurement methods the awarding agency followed met its own statutory requirements before purchasing. Suspension and Debarment Our audit found the District did not have internal controls to verify the contractor it paid more than $25,000 in federal funds was not suspended or debarred from participating in federal programs. We consider these deficiencies in internal controls to be material weaknesses that led to material noncompliance. Cause of Condition District staff did not fully understand piggybacking requirements. Staff did not know they were required to obtain procurement documentation when they piggybacked on the awarding agency’s contract, to verify the process complied with the District’s federal procurement requirements. Also, they did not know they needed to verify the contractor was not suspended or debarred before using the contract. Effect of Condition Procurement The District piggybacked on one contract without reviewing the bid documentation and spent $377,737 of federal funds to purchase food products. Without effective internal controls, the District cannot demonstrate it complied with federal procurement requirements, allowed for full and open competition,  and received the best price for the food products it purchased. Suspension and Debarment The District did not obtain a written certification from the contractor, insert a clause into the contract or check for exclusion records at SAM.gov to verify the contractor it paid $377,737 using federal funds was not suspended or debarred before contracting. We subsequently verified the contractor was not suspended or debarred.  Therefore, we are not questioning the costs. Recommendation We recommend the District strengthen internal controls to ensure it complies with applicable federal procurement requirements for purchases of goods and services and maintain documentation demonstrating compliance with this requirement. Further, we recommend the District strengthen internal controls to verify all contractors it pays $25,000 or more, all or in part with federal funds, are not suspended or debarred from participating in federal programs and maintain documentation demonstrating compliance with this requirement. District’s Response The District will designate the Food Service Director to provide the Finance Director with all Food Service contracts, and the Finance Director will check each applicable vendor’s status on the System for Award Management (SAM) at https://sam.gov prior to contract execution. The Finance Director will maintain a printout of the SAM.gov verification results in procurement records. The Finance Director will provide the Superintendent with a copy of the relevant contracts for her approval. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. Title 2 CFR Part 200, Uniform Guidance, section 320, Methods of procurement to be followed, establishes requirements for procuring with Federal funds by nonfederal entities. Title 2 CFR Part 180, OMB Guidelines to Agencies on Government wide Debarment and Suspension (Nonprocurement), establishes non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11.

Background The District participates in the Child Nutrition Cluster, which includes the National School Lunch, School Breakfast and Summer Food Service programs. These programs provide funding for free and reduced-price meals to students from low-income families. The District received $676,784 to administer these programs during the 2023-24 school year. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding program requirements and monitoring the effectiveness of established controls. State and federal requirements allow local entities to bypass normal procurement laws through a process commonly referred to as “piggybacking.” This process allows entities to purchase goods and services using contracts awarded by another government or group of governments via an interlocal agreement or cooperative. To comply with piggybacking requirements under state law, the entity must enter into this interlocal agreement before it purchases services or goods from the other entity’s bid contract. If the District uses such an agreement, federal regulations require it to confirm that the procurement methods the awarding agency followed met its own statutory procurement laws and followed regulations applicable to the District when selecting the contractor.   Federal requirements also prohibit recipients from contracting with or purchasing from parties suspended or debarred from doing business with the federal government. Whenever the District contracts or purchases goods and services that it expects to equal or exceed $25,000, paid all or in part with federal funds, it must verify that contractors have not been suspended, debarred or otherwise excluded from participating in federal programs. The District may verify this by obtaining a written certification from the contractor, adding a clause or condition into the contract that states the contractor is not suspended or debarred, or checking for exclusion records in the U.S. General Services Administration’s System for Award Management at SAM.gov. The District must very this before entering into the contract, and must maintain documentation to demonstrate compliance with this federal requirement.   Description of Condition Procurement Our audit found the District did not have a process to ensure it complied with procurement requirements when purchasing food. The District piggybacked onto a purchasing cooperative’s contract for food products; however, the District did not confirm that the procurement methods the awarding agency followed met its own statutory requirements before purchasing. Suspension and Debarment Our audit found the District did not have internal controls to verify the contractor it paid more than $25,000 in federal funds was not suspended or debarred from participating in federal programs. We consider these deficiencies in internal controls to be material weaknesses that led to material noncompliance. Cause of Condition District staff did not fully understand piggybacking requirements. Staff did not know they were required to obtain procurement documentation when they piggybacked on the awarding agency’s contract, to verify the process complied with the District’s federal procurement requirements. Also, they did not know they needed to verify the contractor was not suspended or debarred before using the contract. Effect of Condition Procurement The District piggybacked on one contract without reviewing the bid documentation and spent $377,737 of federal funds to purchase food products. Without effective internal controls, the District cannot demonstrate it complied with federal procurement requirements, allowed for full and open competition,  and received the best price for the food products it purchased. Suspension and Debarment The District did not obtain a written certification from the contractor, insert a clause into the contract or check for exclusion records at SAM.gov to verify the contractor it paid $377,737 using federal funds was not suspended or debarred before contracting. We subsequently verified the contractor was not suspended or debarred.  Therefore, we are not questioning the costs. Recommendation We recommend the District strengthen internal controls to ensure it complies with applicable federal procurement requirements for purchases of goods and services and maintain documentation demonstrating compliance with this requirement. Further, we recommend the District strengthen internal controls to verify all contractors it pays $25,000 or more, all or in part with federal funds, are not suspended or debarred from participating in federal programs and maintain documentation demonstrating compliance with this requirement. District’s Response The District will designate the Food Service Director to provide the Finance Director with all Food Service contracts, and the Finance Director will check each applicable vendor’s status on the System for Award Management (SAM) at https://sam.gov prior to contract execution. The Finance Director will maintain a printout of the SAM.gov verification results in procurement records. The Finance Director will provide the Superintendent with a copy of the relevant contracts for her approval. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. Title 2 CFR Part 200, Uniform Guidance, section 320, Methods of procurement to be followed, establishes requirements for procuring with Federal funds by nonfederal entities. Title 2 CFR Part 180, OMB Guidelines to Agencies on Government wide Debarment and Suspension (Nonprocurement), establishes non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11.

Background The District participates in the Child Nutrition Cluster, which includes the National School Lunch, School Breakfast and Summer Food Service programs. These programs provide funding for free and reduced-price meals to students from low-income families. The District received $676,784 to administer these programs during the 2023-24 school year. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding program requirements and monitoring the effectiveness of established controls. State and federal requirements allow local entities to bypass normal procurement laws through a process commonly referred to as “piggybacking.” This process allows entities to purchase goods and services using contracts awarded by another government or group of governments via an interlocal agreement or cooperative. To comply with piggybacking requirements under state law, the entity must enter into this interlocal agreement before it purchases services or goods from the other entity’s bid contract. If the District uses such an agreement, federal regulations require it to confirm that the procurement methods the awarding agency followed met its own statutory procurement laws and followed regulations applicable to the District when selecting the contractor.   Federal requirements also prohibit recipients from contracting with or purchasing from parties suspended or debarred from doing business with the federal government. Whenever the District contracts or purchases goods and services that it expects to equal or exceed $25,000, paid all or in part with federal funds, it must verify that contractors have not been suspended, debarred or otherwise excluded from participating in federal programs. The District may verify this by obtaining a written certification from the contractor, adding a clause or condition into the contract that states the contractor is not suspended or debarred, or checking for exclusion records in the U.S. General Services Administration’s System for Award Management at SAM.gov. The District must very this before entering into the contract, and must maintain documentation to demonstrate compliance with this federal requirement.   Description of Condition Procurement Our audit found the District did not have a process to ensure it complied with procurement requirements when purchasing food. The District piggybacked onto a purchasing cooperative’s contract for food products; however, the District did not confirm that the procurement methods the awarding agency followed met its own statutory requirements before purchasing. Suspension and Debarment Our audit found the District did not have internal controls to verify the contractor it paid more than $25,000 in federal funds was not suspended or debarred from participating in federal programs. We consider these deficiencies in internal controls to be material weaknesses that led to material noncompliance. Cause of Condition District staff did not fully understand piggybacking requirements. Staff did not know they were required to obtain procurement documentation when they piggybacked on the awarding agency’s contract, to verify the process complied with the District’s federal procurement requirements. Also, they did not know they needed to verify the contractor was not suspended or debarred before using the contract. Effect of Condition Procurement The District piggybacked on one contract without reviewing the bid documentation and spent $377,737 of federal funds to purchase food products. Without effective internal controls, the District cannot demonstrate it complied with federal procurement requirements, allowed for full and open competition,  and received the best price for the food products it purchased. Suspension and Debarment The District did not obtain a written certification from the contractor, insert a clause into the contract or check for exclusion records at SAM.gov to verify the contractor it paid $377,737 using federal funds was not suspended or debarred before contracting. We subsequently verified the contractor was not suspended or debarred.  Therefore, we are not questioning the costs. Recommendation We recommend the District strengthen internal controls to ensure it complies with applicable federal procurement requirements for purchases of goods and services and maintain documentation demonstrating compliance with this requirement. Further, we recommend the District strengthen internal controls to verify all contractors it pays $25,000 or more, all or in part with federal funds, are not suspended or debarred from participating in federal programs and maintain documentation demonstrating compliance with this requirement. District’s Response The District will designate the Food Service Director to provide the Finance Director with all Food Service contracts, and the Finance Director will check each applicable vendor’s status on the System for Award Management (SAM) at https://sam.gov prior to contract execution. The Finance Director will maintain a printout of the SAM.gov verification results in procurement records. The Finance Director will provide the Superintendent with a copy of the relevant contracts for her approval. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. Title 2 CFR Part 200, Uniform Guidance, section 320, Methods of procurement to be followed, establishes requirements for procuring with Federal funds by nonfederal entities. Title 2 CFR Part 180, OMB Guidelines to Agencies on Government wide Debarment and Suspension (Nonprocurement), establishes non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11.

Background The District participates in the Child Nutrition Cluster, which includes the National School Lunch, School Breakfast and Summer Food Service programs. These programs provide funding for free and reduced-price meals to students from low-income families. The District received $676,784 to administer these programs during the 2023-24 school year. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding program requirements and monitoring the effectiveness of established controls. State and federal requirements allow local entities to bypass normal procurement laws through a process commonly referred to as “piggybacking.” This process allows entities to purchase goods and services using contracts awarded by another government or group of governments via an interlocal agreement or cooperative. To comply with piggybacking requirements under state law, the entity must enter into this interlocal agreement before it purchases services or goods from the other entity’s bid contract. If the District uses such an agreement, federal regulations require it to confirm that the procurement methods the awarding agency followed met its own statutory procurement laws and followed regulations applicable to the District when selecting the contractor.   Federal requirements also prohibit recipients from contracting with or purchasing from parties suspended or debarred from doing business with the federal government. Whenever the District contracts or purchases goods and services that it expects to equal or exceed $25,000, paid all or in part with federal funds, it must verify that contractors have not been suspended, debarred or otherwise excluded from participating in federal programs. The District may verify this by obtaining a written certification from the contractor, adding a clause or condition into the contract that states the contractor is not suspended or debarred, or checking for exclusion records in the U.S. General Services Administration’s System for Award Management at SAM.gov. The District must very this before entering into the contract, and must maintain documentation to demonstrate compliance with this federal requirement.   Description of Condition Procurement Our audit found the District did not have a process to ensure it complied with procurement requirements when purchasing food. The District piggybacked onto a purchasing cooperative’s contract for food products; however, the District did not confirm that the procurement methods the awarding agency followed met its own statutory requirements before purchasing. Suspension and Debarment Our audit found the District did not have internal controls to verify the contractor it paid more than $25,000 in federal funds was not suspended or debarred from participating in federal programs. We consider these deficiencies in internal controls to be material weaknesses that led to material noncompliance. Cause of Condition District staff did not fully understand piggybacking requirements. Staff did not know they were required to obtain procurement documentation when they piggybacked on the awarding agency’s contract, to verify the process complied with the District’s federal procurement requirements. Also, they did not know they needed to verify the contractor was not suspended or debarred before using the contract. Effect of Condition Procurement The District piggybacked on one contract without reviewing the bid documentation and spent $377,737 of federal funds to purchase food products. Without effective internal controls, the District cannot demonstrate it complied with federal procurement requirements, allowed for full and open competition,  and received the best price for the food products it purchased. Suspension and Debarment The District did not obtain a written certification from the contractor, insert a clause into the contract or check for exclusion records at SAM.gov to verify the contractor it paid $377,737 using federal funds was not suspended or debarred before contracting. We subsequently verified the contractor was not suspended or debarred.  Therefore, we are not questioning the costs. Recommendation We recommend the District strengthen internal controls to ensure it complies with applicable federal procurement requirements for purchases of goods and services and maintain documentation demonstrating compliance with this requirement. Further, we recommend the District strengthen internal controls to verify all contractors it pays $25,000 or more, all or in part with federal funds, are not suspended or debarred from participating in federal programs and maintain documentation demonstrating compliance with this requirement. District’s Response The District will designate the Food Service Director to provide the Finance Director with all Food Service contracts, and the Finance Director will check each applicable vendor’s status on the System for Award Management (SAM) at https://sam.gov prior to contract execution. The Finance Director will maintain a printout of the SAM.gov verification results in procurement records. The Finance Director will provide the Superintendent with a copy of the relevant contracts for her approval. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. Title 2 CFR Part 200, Uniform Guidance, section 320, Methods of procurement to be followed, establishes requirements for procuring with Federal funds by nonfederal entities. Title 2 CFR Part 180, OMB Guidelines to Agencies on Government wide Debarment and Suspension (Nonprocurement), establishes non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11.