2025-002 Suspension and Debarment Prior Year Finding Number: N/A Year of Finding Origination: 2023 Type of Finding: Internal Control Over Compliance and Compliance Severity of Deficiency: Significant Deficiency and Other Matter Federal Agency: U.S. Department of the Treasury Program: 21.027 COVID-19 – Coronavirus State and Local Fiscal Recovery Funds Award Number and Year: SLFRP1349; 2021 Pass-Through Agency: N/A – Direct Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish, document, and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Federal requirements prohibit non-federal entities from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Title 2 U.S. Code of Federal Regulations § 180.300 describes a required verification process. Prior to entering into the transaction, one of the following must be performed: (1) checking SAM.gov exclusions, (2) collecting a certification, or (3) adding a clause or condition to the covered transaction. Condition: For both covered transactions selected for testing, the County did not perform the verification for suspended or debarred vendors prior to entering into the covered transactions. Questioned Costs: $1,094,066; known questioned costs were determined based on payments to the two vendors tested. Context: Covered transactions to the two vendors totaled $1,094,066. Both vendors were included in our sample. A subsequent check to SAM.gov did not identify either vendor as suspended or debarred. Effect: Failure to verify vendors are not suspended, debarred, or otherwise excluded prior to entering into a covered transaction may result in the County entering into a transaction with a vendor that is not authorized to provide goods and services to the grant. Cause: The County informed us that they believed checks for suspension and debarment were performed, however, were unable to locate the documentation to support this. Recommendation: We recommend the County maintain documentation to demonstrate that vendors were not debarred, suspended, or otherwise excluded from conducting business with the County; this documentation should be completed prior to entering a covered transaction. View of Responsible Official: Acknowledge