Audit 359647

Procurement and Suspension and Debarment Finding Number: 2024-001 Assistance Listing Number and Title COVID-19 Coronavirus State and Local Fiscal Recovery Funds – AL #21.027 Federal Award Identification Number / Year: 2024 Federal Agency: U.S. Department of Treasury Compliance Requirement: Procurement and Suspension and Debarment Pass-Through Entity: Ohio Facilities Construction Commission Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR 1000.10 gives regulatory effect to the U.S. Department of Treasury for 2 CFR § 200.318 through 200.327 which describe specific procedures non-Federal entities must follow when entering into procurement transactions using Federal funds. 2 CFR § 1400.332 requires participants to include a term or condition in lower-tier transactions requiring lower-tier participants to comply with Subpart C of the OMB Guidance in 2 CFR Part 180. 2 CFR Part 180, Subpart C, Paragraph 300 instructs, "when you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking SAM Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person. Additionally, in 31 CFR § 19.300, the U.S. Department of Treasury requires participants entering into a covered transaction with another person at the next lower tier, to verify that the person with whom they intend to do business is not excluded or disqualified by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person. Additionally, District Policy: PROCUREMENT - FEDERAL GRANTS/FUNDS, states that for contracts over $25,000, the District shall confirm that the vendor is not debarred or suspended by either checking the Federal government's System for Award Management, which maintains a list of such debarred or suspended vendors at www.sam.gov; collecting a certification from the vendor; or adding a clause or condition to the covered transaction with that vendor. The District did not have the proper internal controls in place to verify that all entities, with whom the District had entered into covered transactions, had not been suspended or debarred. During testing of Ohio K-12 School Safety Grant – Public School Districts, we noted the District entered into two out of four contracts with vendors for more than $25,000, and there was no evidence the District checked the SAM exclusions, collected a certification from the entity, or added a clause or condition to the covered transaction with the vendor. Due to the deficient internal control structure, the required verifications were not completed for the two covered transactions during Fiscal Year 2024. Failing to have the appropriate controls in place may result in vendors receiving federal funds that are suspended or debarred. Prior to entering into covered transactions, the District should verify the vendor is not suspended or debarred by checking the SAM exclusions, collecting a certification from the vendor, or adding a clause or condition to the covered transaction with the vendor.

. Reporting Finding Number: 2024-002 Assistance Listing Number and Title COVID-19 Coronavirus State and Local Fiscal Recovery Funds – AL #21.027 Federal Award Identification Number / Year: 2024 Federal Agency: U.S. Department of Treasury Compliance Requirement: Reporting Pass-Through Entity: Ohio Facilities Construction Commission Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR 1000.10 gives regulatory effect to the U.S. Department of Treasury for 2 CFR § 200.328 through 200.330 which describe specific procedures non-Federal entities must follow for performance and financial monitoring and reporting of Federal funds. 2 CFR § 200.328 states unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMB-approved governmentwide data elements for collection of financial information (at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead). This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances. The Federal awarding agency must use OMB approved common information collections, as applicable, when providing financial and performance reporting information. The District's grant agreement states that the grantee agrees to comply with any reporting obligations established by Treasury, as it relates to this award. Grantee also agrees to comply with any reporting requirements established by the Grantor, the Office of Budget and Management, or the State of Ohio, as it relates to this award. The Grantor has established a reporting workbook that is to be completed for each quarter the District reports. The reporting workbook includes four tabs, two of which are required to be completed for each reporting submission. During testing, the following errors in the completion of the reporting workbook were identified due to a deficient internal control structure: • Two of the District's quarterly reports were improperly certified. • Two of the District's quarterly reports inaccurately presented program expenditures. Failure to properly submit quarterly reports could result in Ohio Facilities Construction Commission taking action against the District for failure to comply with programmatic requirements. The District should implement policies and procedures to review the reports prior to submission to help ensure the reports are complete and accurate.

Procurement and Suspension and Debarment Finding Number: 2024-003 Assistance Listing Number and Title COVID-19 Coronavirus State and Local Fiscal Recovery Funds – AL #21.027 Federal Award Identification Number / Year: 2024 Federal Agency: U.S. Department of Treasury Compliance Requirement: Procurement and Suspension and Debarment Pass-Through Entity: Ohio Facilities Construction Commission Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR 1000.10 gives regulatory effect to the U.S. Department of Treasury for 2 CFR § 200.318 through 200.327 which describe specific procedures non-Federal entities must follow when entering into procurement transactions using Federal funds. 2 CFR 200.324(a) requires a cost or price analysis be performed for every procurement transaction, including contract modifications, in excess of the simplified acquisition threshold. The method and degree of analysis conducted depend on the facts surrounding the particular procurement transaction. 2 CFR 200.324(c) states that the “cost plus a percentage of cost” and “percentage of construction costs” methods of contracting must not be used. Additionally, District Policy: PROCUREMENT - FEDERAL GRANTS/FUNDS, states that the District shall perform a cost or price analysis in connection with every procurement action in excess of $250,000, including contract modifications. A cost analysis generally means evaluating the separate cost elements that make up the total price, while a price analysis means evaluating the total price, without looking at the individual cost elements. The method and degree of analysis are dependent on the facts surrounding the particular procurement situation; however, the District shall come to an independent estimate prior to receiving bids or proposals. The District did not have the proper internal controls in place to perform a cost or price analysis for procurements in excess of $250,000. During testing of Ohio K-12 School Safety Grant – Public School Districts, we noted the District used the sealed bid procurement to award a project in excess of $250,000, and there was no evidence the District performed a cost or price analysis. Due to the deficient internal control structure, the required cost or price analysis was not completed for the procurement action covering a transaction made in Fiscal Year 2024. Failing to have the appropriate controls in place may result in rewarding contracts to vendors whose bids or proposals are not the most responsive and responsible. The District should perform a cost or price analysis for all procurement actions in excess of $250,000.

Procurement and Suspension and Debarment Finding Number: 2024-001 Assistance Listing Number and Title COVID-19 Coronavirus State and Local Fiscal Recovery Funds – AL #21.027 Federal Award Identification Number / Year: 2024 Federal Agency: U.S. Department of Treasury Compliance Requirement: Procurement and Suspension and Debarment Pass-Through Entity: Ohio Facilities Construction Commission Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR 1000.10 gives regulatory effect to the U.S. Department of Treasury for 2 CFR § 200.318 through 200.327 which describe specific procedures non-Federal entities must follow when entering into procurement transactions using Federal funds. 2 CFR § 1400.332 requires participants to include a term or condition in lower-tier transactions requiring lower-tier participants to comply with Subpart C of the OMB Guidance in 2 CFR Part 180. 2 CFR Part 180, Subpart C, Paragraph 300 instructs, "when you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking SAM Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person. Additionally, in 31 CFR § 19.300, the U.S. Department of Treasury requires participants entering into a covered transaction with another person at the next lower tier, to verify that the person with whom they intend to do business is not excluded or disqualified by: (a) Checking the EPLS; or (b) Collecting a certification from that person if allowed by this rule; or (c) Adding a clause or condition to the covered transaction with that person. Additionally, District Policy: PROCUREMENT - FEDERAL GRANTS/FUNDS, states that for contracts over $25,000, the District shall confirm that the vendor is not debarred or suspended by either checking the Federal government's System for Award Management, which maintains a list of such debarred or suspended vendors at www.sam.gov; collecting a certification from the vendor; or adding a clause or condition to the covered transaction with that vendor. The District did not have the proper internal controls in place to verify that all entities, with whom the District had entered into covered transactions, had not been suspended or debarred. During testing of Ohio K-12 School Safety Grant – Public School Districts, we noted the District entered into two out of four contracts with vendors for more than $25,000, and there was no evidence the District checked the SAM exclusions, collected a certification from the entity, or added a clause or condition to the covered transaction with the vendor. Due to the deficient internal control structure, the required verifications were not completed for the two covered transactions during Fiscal Year 2024. Failing to have the appropriate controls in place may result in vendors receiving federal funds that are suspended or debarred. Prior to entering into covered transactions, the District should verify the vendor is not suspended or debarred by checking the SAM exclusions, collecting a certification from the vendor, or adding a clause or condition to the covered transaction with the vendor.

. Reporting Finding Number: 2024-002 Assistance Listing Number and Title COVID-19 Coronavirus State and Local Fiscal Recovery Funds – AL #21.027 Federal Award Identification Number / Year: 2024 Federal Agency: U.S. Department of Treasury Compliance Requirement: Reporting Pass-Through Entity: Ohio Facilities Construction Commission Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR 1000.10 gives regulatory effect to the U.S. Department of Treasury for 2 CFR § 200.328 through 200.330 which describe specific procedures non-Federal entities must follow for performance and financial monitoring and reporting of Federal funds. 2 CFR § 200.328 states unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMB-approved governmentwide data elements for collection of financial information (at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead). This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances. The Federal awarding agency must use OMB approved common information collections, as applicable, when providing financial and performance reporting information. The District's grant agreement states that the grantee agrees to comply with any reporting obligations established by Treasury, as it relates to this award. Grantee also agrees to comply with any reporting requirements established by the Grantor, the Office of Budget and Management, or the State of Ohio, as it relates to this award. The Grantor has established a reporting workbook that is to be completed for each quarter the District reports. The reporting workbook includes four tabs, two of which are required to be completed for each reporting submission. During testing, the following errors in the completion of the reporting workbook were identified due to a deficient internal control structure: • Two of the District's quarterly reports were improperly certified. • Two of the District's quarterly reports inaccurately presented program expenditures. Failure to properly submit quarterly reports could result in Ohio Facilities Construction Commission taking action against the District for failure to comply with programmatic requirements. The District should implement policies and procedures to review the reports prior to submission to help ensure the reports are complete and accurate.

Procurement and Suspension and Debarment Finding Number: 2024-003 Assistance Listing Number and Title COVID-19 Coronavirus State and Local Fiscal Recovery Funds – AL #21.027 Federal Award Identification Number / Year: 2024 Federal Agency: U.S. Department of Treasury Compliance Requirement: Procurement and Suspension and Debarment Pass-Through Entity: Ohio Facilities Construction Commission Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR 1000.10 gives regulatory effect to the U.S. Department of Treasury for 2 CFR § 200.318 through 200.327 which describe specific procedures non-Federal entities must follow when entering into procurement transactions using Federal funds. 2 CFR 200.324(a) requires a cost or price analysis be performed for every procurement transaction, including contract modifications, in excess of the simplified acquisition threshold. The method and degree of analysis conducted depend on the facts surrounding the particular procurement transaction. 2 CFR 200.324(c) states that the “cost plus a percentage of cost” and “percentage of construction costs” methods of contracting must not be used. Additionally, District Policy: PROCUREMENT - FEDERAL GRANTS/FUNDS, states that the District shall perform a cost or price analysis in connection with every procurement action in excess of $250,000, including contract modifications. A cost analysis generally means evaluating the separate cost elements that make up the total price, while a price analysis means evaluating the total price, without looking at the individual cost elements. The method and degree of analysis are dependent on the facts surrounding the particular procurement situation; however, the District shall come to an independent estimate prior to receiving bids or proposals. The District did not have the proper internal controls in place to perform a cost or price analysis for procurements in excess of $250,000. During testing of Ohio K-12 School Safety Grant – Public School Districts, we noted the District used the sealed bid procurement to award a project in excess of $250,000, and there was no evidence the District performed a cost or price analysis. Due to the deficient internal control structure, the required cost or price analysis was not completed for the procurement action covering a transaction made in Fiscal Year 2024. Failing to have the appropriate controls in place may result in rewarding contracts to vendors whose bids or proposals are not the most responsive and responsible. The District should perform a cost or price analysis for all procurement actions in excess of $250,000.