Audit 363110

U.S. Department of Treasury, COVID-19 Coronavirus State and Local Fiscal Recovery Funds - 21.027 Criteria or Specific Requirement - Suspension and Debarment and Material Weakness In accordance with 2 CFR 200.214, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. In accordance with 2 CFR Section 180.300, when a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR Section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Per 2 CFR 200.303, the non-Federal entities receiving federal awards (i.e., auditee management) establish and maintain internal control design to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition - Suspension and debarment checks were not completed for a vendor prior to entering into a contract. Cause - The City's controls to ensure suspension and debarment checks on vendors receiving federal funds did not operate effectively. Effect - Federal funds could be paid to entities that are suspended or debarred. Questioned Costs - None noted, as the vendor was reviewed and determined to not be suspended or debarred. Context - The City only entered into one contract during the year ended December 31, 2024 that was considered a "covered transaction" and spent approximately $540,000 under this contract. This single contract was selected for testing suspension and debarment and uncovered the City did not check the vendor's suspension and debarment status prior to purchase. The City completed the suspsension and debarment check subsequent to purchase and verified the vendor was not suspended or disbarred. Identification as a Repeat Finding, if applicable - None noted. Recommendation - Policies and procedures should be modified to ensure that suspension and debarment checks are performed on vendors prior to making purchases with federal funds. View of Responsible Official and Planned Corrective Actions - Management agrees with the stated finding and has implemented a corrective action plan.

U.S. Department of Treasury, COVID-19 Coronavirus State and Local Fiscal Recovery Funds - 21.027 Criteria or Specific Requirement - Suspension and Debarment and Material Weakness In accordance with 2 CFR 200.214, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. In accordance with 2 CFR Section 180.300, when a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR Section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Per 2 CFR 200.303, the non-Federal entities receiving federal awards (i.e., auditee management) establish and maintain internal control design to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition - Suspension and debarment checks were not completed for a vendor prior to entering into a contract. Cause - The City's controls to ensure suspension and debarment checks on vendors receiving federal funds did not operate effectively. Effect - Federal funds could be paid to entities that are suspended or debarred. Questioned Costs - None noted, as the vendor was reviewed and determined to not be suspended or debarred. Context - The City only entered into one contract during the year ended December 31, 2024 that was considered a "covered transaction" and spent approximately $540,000 under this contract. This single contract was selected for testing suspension and debarment and uncovered the City did not check the vendor's suspension and debarment status prior to purchase. The City completed the suspsension and debarment check subsequent to purchase and verified the vendor was not suspended or disbarred. Identification as a Repeat Finding, if applicable - None noted. Recommendation - Policies and procedures should be modified to ensure that suspension and debarment checks are performed on vendors prior to making purchases with federal funds. View of Responsible Official and Planned Corrective Actions - Management agrees with the stated finding and has implemented a corrective action plan.