Audit 393491

2025-001: Suspension and Debarment Verification Not Documented Assistance Listing Numbers: 21.027 Assistance Listing Title: Coronavirus State and Local Fiscal Recovery Funds Name of Federal Agency: U.S. Department of Treasury Pass-Through Agency: Alameda County Housing and Community Development Department Pass-Through Agreement Number: 26120 Criteria Per 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 is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA) and available at SAM.gov (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity. Condition During testing of procurement transactions, we noted that debarment and suspension checks were not documented. This was noted for two out of two procurements tested. Cause The District did not maintain sufficient documentation to demonstrate that the required debarment and suspension verification was performed prior to entering into the transaction. Effect Inability to demonstrate compliance with debarment and suspension requirements may result in questioned costs requiring repayment to federal agencies if the District enters into covered transactions with vendors that are subsequently identified as either suspended or debarred from participating in federally funded programs. Questioned Costs No questioned costs were identified. Recommendation We recommend that the District enhance record-keeping policies and procedures relating to procurements to ensure that documentation demonstrating compliance with suspension and debarment requirements is maintained for all federally funded procurement transactions. Management Response The District will revise its procurement practices to implement the auditor’s recommendation. Specifically, we will include a clause in all contracts and Professional Services Agreements that requires documentation demonstrating compliance with federal suspension and debarment requirements for all federally funded procurement transactions. This update will ensure that proper verification and record keeping are consistently maintained and retained within procurement files, thereby enhancing the District’s documentation of compliance with applicable federal requirements.