Corrective Action Plans

Description of Finding: The Board of Education failed to solicit quotations related to a contract paid under the grant, in noncompliance with federal/local policy. Statement of Concurrence or Nonconcurrence: Management agrees with this finding. Corrective Action: Management will review existing processes and contracts to ensure procurements are taking place in compliance with local policies and federal guidance. Name of Contact Person: Lunda Asmani, Chief Financial Officer, Board of Education Projected Completion Date: June 30, 2025

January 5, 2024 To: Nigro & Nigro PC Regarding Audit Finding 2024-001 Procurement (5000) Assistance Listing #10.533, 10.55- U.S Department of Agriculture, California Department of Education, Child Nutrition Cluster We agree with the auditor's comments and the following actions will be taken to ensure the district is compliant with Code of Federal Regulations, CFR 200.320. 1) Implement a district system to track all formal bids, informal bids and RFQ's by contract year 2) Documents will include key information such as bid solicitation dates, contract dates and renewal dates for all Nutrition Services bids, RFPs, RFQs and micro-purchases. 3) The Director of NUtrition Services will review all contracts at the beginning of each school year. These steps along with training key personnel will make sure we are in compliance with Code of Federal Regulations, CFR 200.320 Michelle Cagle Director, Fiscal Services

Finding 2024-004 Procurement, Suspension and Debarment Significant Deficiency in Internal Control over Compliance Finding Summary: During the course of the engagement in testing of procurement, suspension and debarment it was identified that the School’s micro-purchase threshold did not satisfy the requirements of 2 CFR sections 200.318 through 200.326. Responsible Individuals: Brandon Lunak, Superintendent Corrective Action Plan: The District will update their procurement policy for federal programs to be in compliance with all areas as identified in 2 CFR sections 200.318 through 200.326. Anticipated Completion Date: June 30, 2025

NONCOMPLIANCE WITH PROCUREMENT AND SUSPENSION AND DEBARMENT REQUIREMENTS, CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS; AL No. 21.027; GRANT No. Direct allocation and AM-23-0287 Name of contact person: Kelly Strecker Corrective Action: The City commits to ensuring that a procurement policy be put in place that will allow it to comply with procurement standards outlined in the Uniform Guidance. Proposed Completion Date: Immediately

Finding Number: 2024-001 Program Name/Assistance Listing Title: COVID-19 Coronavirus State and Local Fiscal Recovery Fund Assistance Listing Number: 21.027 Contact Person: Jeremy Bow, Director of Finance Anticipated Completion Date: August 12, 2024 Planned Corrective Action: In May of 2020, amid the urgent health and safety impacts of the global Covid-19 pandemic, Emerge closed its emergency shelter facility in order to transition to the use of a hotel to provide a non-congregate shelter setting for its Participants. In the urgency to make the transition and the uncertainty of the duration of stay, Emerge did not perform a SAM.gov review of the hotel for suspension or debarment, as federal funds were not anticipated to be utilized at the time. In April 2022, Emerge surpassed the $25,000 threshold for federal funds paid to this vendor during a fiscal year. Having previously been operating out of the hotel for nearly 2 years prior, the need for a SAM.gov review was overlooked at that time and was not identified on the audits for either fiscal year 2022 or 2023. When notified of the deficiency on August 12, 2024, during initial field work for the audit of fiscal year 2024, Emerge took same-day action to resolve the previous oversight. On August 12, 2024 Emerge performed the necessary check via SAM.gov and confirmed the vendor hotel was free from suspension or debarment. Concurrently, Emerge revised its Procurement Policy to specifically require compliance with Federal Acquisition Regulation Systems - 2 CFR §180.300 & §180.995. Per Emerge Procurement Policy, revised August 2024: “Any Agency procurement action which will utilize federal or sub-federal funds, in full or in part, shall be done so in compliance with Federal Acquisition Regulation Systems - 48 CFR §2 Subpart 2.1, 2 CFR §200 Subpart D, and 2 CFR §180.300 & §180.995 as required by federal regulation. Compliance with this and all other Federal guidance shall be the shared responsibility of the Chief Executive Officer, Senior Leadership, and the Director of Finance. Copies of these regulations shall be maintained by the Agency for reference.” It is Emerge’s perspective that appropriate action has been taken in order to substantially mitigate the risk of recurrence based on the revisions to its Procurement Policy and the internal reviews of both the revised policy and the audit finding with Senior Leadership.

Material Weakness in Internal Control Over Compliance and Other Matters Recommendation: We recommend the District ensures it retains all documentation for procurement methods used such as retaining all quotes/bids received, as well as formally documenting rationale for all procurement decisions made. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The District will work to revise its procurement procedures and policies to ensure compliance with documentation requirements. Specifically, the District will implement a system to retain all quotes/bids received and formally document rationale for all procurement decisions. Name(s) of the contact person(s) responsible for corrective action: David Brecht, Executive Director of Finance and Operations. Planned completion date for corrective action plan: June 30, 2025

Material Weakness in Internal Control Over Compliance Recommendation: We recommend the District ensures it retains all documentation for procurement methods used such as retaining all quotes/bids received, as well as formally documenting rationale for all procurement decisions made. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The District will work to revise its policies and procedures to ensure that all required documentation, including quotes, bids, and the formal rationale for procurement decisions, is retained in compliance with best practices and applicable regulations. These updates will include clear guidelines for procurement methods, documentation requirements, and accountability measures to ensure compliance moving forward. Name(s) of the contact person(s) responsible for corrective action: David Brecht, Executive Director of Finance and Operations. Planned completion date for corrective action plan: June 30, 2025

December 18, 2024 Donovan CPAs 9292 N. Meridian Street, Suite 150 Indianapolis, IN 46260 Subject: Response to Uniform Guidance Audit Finding for FY23-24 Finding 2024-001 Procurement Significant Deficiency Federal Program: Charter Schools Program Assistance Listing Numbers: 84.282A Springville Community Academy (SCA) plans to develop a written procurement policy that incorporates the Federal regulations and procurement standards identified in §200.317 through 200.327. I, Corbin Dietrich, will work with the Board of Directors of SCA and our consultants with Indiana Charters to develop the appropriate procurement policies and procedures. We plan to draft and approve the required policies at the board meeting in January 2025. Sincerely, Corbin Dietrich, Treasurer

The Organization has historically addressed procurement in our finance manual., however we will create a stand-alone procurement policy that is monitored regularly to ensure compliance with Uniform Guidance. Further, relevant staff participated in a training focused on CHC grants management matters in December 2024 and will continue to look for learning opportunities to support and challenge compliance matters. Official Responsible for Ensuring the Corrective Action Plan: Danielle Hahn, Progressive Community Health Center Chief Financial Officer. Planned Completion Date for the Corrective Action Plan: The Organization plans to obtain Board approval for the updated procurement policy in January 2025 and will continue to monitor throughout the year.

Finding 2024-002 – Procurement, Suspension, and Debarment Federal Grantor: Department of Health and Human Services Assistance Listing No.: Assistance Listing 93.493, Congressional Directives Federal Award Number: CE1HS52357-01-00 Federal Award Period of Performance: September 30, 2023 – September 29, 2026 A material weakness was issued related to internal control over suppliers under the UG audit. CFNI recognizes the need to comply with the procurement standards outlined in 2 CFR §§ 200.318-326, which require written policies addressing competition, conflicts of interest, procurement methods (micro-purchases, small purchases, sealed bids, competitive proposals, and noncompetitive procurement), oversight, efforts to engage small and disadvantaged businesses, and procurement of recovered materials, among others. To address this deficiency, CFNI is committed to enhancing its documented procurement policies for procure-to-pay processes involving federal funds. The audit identified three instances out of 40 sampled where CFNI did not retain documentation verifying that suspension and debarment reviews were conducted during the onboarding of new suppliers. Although CFNI has an established vetting process, it recognizes the need for consistent documentation to evidence compliance. CFNI will implement formalized procedures to ensure all suspension and debarment reviews are documented and retained for audit purposes. CFNI engages a third-party contractor to monitor its supplier list against suspension and debarment databases. While the vendor provided a SOC 1 report, it did not specifically cover the suspension and debarment services provided. Additionally, CFNI did not conduct testing to validate the accuracy of the third-party's results. CFNI will revise its vendor management practices to ensure the SOC 1 reports cover the relevant services, and it will establish testing procedures to confirm the reliability of the vendor's outputs. Although CFNI utilizes two processes to monitor active suppliers against suspension and debarment lists—periodic PeopleSoft program checks and an annual review by a third-party vendor—no reconciliation was documented to confirm that the supplier lists provided to and received from the third party were complete and accurate. Additionally, no testing was conducted to validate the third party’s work. CFNI will implement a reconciliation process to verify the completeness and accuracy of supplier lists before and after third-party reviews. Furthermore, it will establish a sampling and testing procedure to validate the results provided by external vendors. CFNI will develop and implement a robust supplier management policy, incorporating requirements for procurement, suspension, and debarment reviews. Responsible Official: Pamela Pokropinski, VP Finance Status of finding: Completion expected June 2025

At this time, the administrator(s)/staff member(s) tasked with executing the grant requirements at KANZA will more effectively document standard purchasing procedures and the additional requirements applicable to procurements that are subject to the federal Uniform Guidance regulations concerning the use of federal funds. Planned Completion Date: The procedures will be implemented on or before January 1, 2025. Contact Person Responsible for Correction Action: Shelby Donahoo, Director of Finance

2024‐001 Procurement and Suspension and Debarment Person Responsible for Corrective Action: Lark Reynolds, Business Administrator Correction Action Planned: (1) The District management will review procurement policies with staff. (2) Timely action will be taken to solicit bids for contracts that exceeds District thresholds. (3) To ensure full and open competition takes place, management will routinely review spending reports. Anticipate Completion Date: November 30, 2024

Child Nutrition Cluster - Assistance Listing Nos. 10.553, 10.555, 10.559 Recommendation: We recommend the District review their controls and procedures surrounding procurement to ensure their purchasing policy is followed. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The District will review the Sole Soure form on an annual basis to make sure the form has not expired. Name(s) of the contact person(s) responsible for corrective action: Debrah Jones, Director of Strategic Sourcing and Contract Management (SSCM) Planned completion date for corrective action plan: 12/31/2024

FINDING 2024-005 Subject: Special Education Cluster (IDEA) - Procurement and Suspension and Debarment Federal Agency: Department of Education Federal Program: Special Education Grants to States Assistance Listing Number: 84.027 Federal Award Numbers and Years (or Other Identifying Numbers): H027A210084, H027A220084, H027A230084 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Finding: Material Weakness Condition: An effective internal control system was not in place at the School District to ensure compliance with requirements related to the Special Education Cluster and Procurement and Suspension and Debarment compliance requirements. Context: During the audit period, the School District purchased Special Education contracted services from one specialist with aggregate payments for each fiscal year which were within the small purchases threshold ($10,000 - $150,000) under Federal and State procurement regulations. The School District did not solicit multiple quotes for services, document the method and rationale for procurement, and did not perform a check to confirm the service provider was not suspended or debarred before entering into the contract and disbursing federal funds. FINDING 2024-005 (Continued) Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: Management will implement a procurement checklist that is reviewed management to ensure compliance with the School's purchasing policy for federal awards. Sam.gov will be checked for each vendor being paid from Federal Funds. Responsible Party and Timeline for Completion: Moriah Crane - Treasurer and Andrew Grismore - Grant Coordinator starting immediately.

2024 – 002 – Procurement Grantor: Department of Health and Human Services Passthrough Agency: N/A Program Name: Community Project Funding/Congressionally Directed Spending - Construction Award Name: Congressional Directives Award Year: 2024 Award Number: 6 CE1HS47194-01-10 Assistance Listing Number: 93.493 The Alliance believes that the procurement process followed all necessary guidelines. However, the Alliance recognizes that the documentation in these two cases was insufficient. As a corrective action, in Fiscal Year 2025 the Alliance will implement improved documentation procedures to ensure that the vendor selection process is documented.

Corrective Action Plan: The District has developed and implemented a Federal Funds Manual. Anticipated Corrective Action Plan Completion Date: November 18, 2024 Contact Information: For additional information regarding this finding please contact Blaise Paul, Chief Business & Finance Officer, at 414-768-6140.

CORRECTIVE ACTION PLAN OF CURRENT AUDIT FINDINGS June 30, 2024 FINDING 2024-001 Information on the federal program: Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program, Summer Food Program, School Summer Food Service Program Assistance Listing Number: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 2023, FY 2024 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Finding: Material Weakness Condition: An effective internal control system was not in place at the School Corporation to ensure compliance with requirements related to the Child Nutrition Program and Procurement and Suspension and Debarment compliance requirements. Context: Procurement Federal regulations allow for informal procurement methods when the value of the procurement for property or services does not exceed the simplified acquisition threshold, which is set at $250,000 unless a lower, more restrictive threshold is set by a non-Federal entity. As Indiana Code has set a more restrictive threshold of $150,000, informal procurement methods are permitted when the value of the procurement does not exceed $150,000. This informal process allows for methods other than the formal bid process. The informal process is divided between two methods based on thresholds. Micro-purchases, typically for those purchases $50,000 or under, and small purchase procedures for those purchases above the micropurchase threshold, but below the simplified acquisition threshold. The School Corporation's policy states that the small purchase threshold is between $10,000 and $150,000. If small purchase procedures are used, then price or rate quotations must be obtained from an adequate number of qualified sources. For fiscal year 2023, two vendors, totaling $109,657 and $53,441, were selected for testing at the small purchase threshold. The School Corporation did not obtain price or rate quotes nor was there documentation detailing the history of procurement, which must include the reason for the procurement method used. The lack of internal controls and noncompliance was isolated to fiscal year 2023. Suspension and Debarment Prior to entering into subawards and covered transactions with federal award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include but are not limited to contracts for goods and services awarded under a non-procurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the SAMs exclusions, collecting a certification from that vendor, or adding a clause or condition to the covered transaction with that vendor. During the audit period, there were ten vendors identified which exceeded $25,000 in disbursements on an annual basis. Six vendors were selected for testing. In one instance, the School Corporation's contract with the vendor did not include any suspension and debarment clause and the School Corporation did not verify the vendor's suspension and debarment status prior to payment. The lack of internal controls and noncompliance was isolated to fiscal year 2023. Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: Management will ensure that the School Corporation's procurement policy is being followed for all procurement thresholds. Management will perform a periodic check of federal fund disbursements to see if any vendors exceed procurement or suspension and debarment thresholds on an annual basis to ensure compliance with federal and state procurement guidelines. The School Corporation will ensure that all contracts exceeding $25,000 include a suspension and debarment clause and will verify that the vendor is not suspended or debarred prior to entering into the contract. Responsible Party and Timeline for Completion: The Food Service Department has already implemented these changes as the issue was not present in fiscal year 2024.

Identifying Number: 2024-003 Suspension and Debarment—Material Weakness U.S. Department of Agriculture Passed through Missouri Department of Elementary and Secondary Education Child Nutrition Cluster, Assistance Listing No. 10.555 (National School Lunch Program), 10.553 (School Breakfast Program), 10.582 (Fresh Fruit and Vegetable Program) Federal award year 2023-2024 Summary of Finding: Criteria: The Uniform Guidance (2 CFR 200.303) requires nonfederal entities receiving federal awards to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance retirements. Also, the Uniform Guidance (2 CFR 200.212 and 200.318(h)) stipulates that when a nonfederal entity enters into a contract or purchase with an entity (vendor or subrecipient), the nonfederal entity must verify the entity is not suspended or debarred from participation in federal programs/grants when expending $25,000 or more in a year. Condition: The District did not have controls in place to reasonably ensure any entity receiving more than $25,000 in federal grant funds was not suspended or debarred, prior to providing them with federal funds. Cause: A lack of controls to reasonably ensure this verification was performed. Effect or potential effect: The District did not have controls in place to reasonably ensure compliance with suspension and debarment requirements of the Uniform Guidance. The potential effect is submitting unallowable costs, or loss of federal funding. Corrective Action: Management has developed the following procedures to ensure that vendors are not suspended or debarred: • All current vendors will be checked against Sam.gov on a quarterly basis. • All vendors receiving Federal funds of $25,000 or greater will be checked prior to completion of any purchase requisition. • All vendor applicants will be required to sign a Certified document that they are not suspended or debarred along with the Vendor App. • All bids will have a Certified document included for vendors to submit that declares they are not suspended or debarred. Anticipated Completion Date: December 2024 (for the year ending June 30, 2025). Contact Person: Stacy Swenson, Director of Purchasing 816-321-5016 Stacy.swenson@nkcschools.org

CORRECTIVE ACTION PLAN 2024-002 – Written Policies Required by Uniform Grant Guidance Corrective Action: Institute a formal grant policy in accordance with Uniform Grant Guidance. Responsible Party: Finance Director Date to Complete By: 1-31-25

The Village of Lexington hired, through a bid process, Townley Engineering to design needed water and sewer expansion and upgrades for the purpose of submitting to USDA for Water and waste disposal systems for rural communities grants in 2017. The Village was awarded funding and hos worked closely with USDA representatives as we have moved through the program. A budget for all costs was approved as part of the grant award. All invoices, including all engineering fees, are approved directly by our assigned Area Specialist. The project costs are currently all within budget. The Village of Lexington will ensure that engineering services follow correct procurement procedures in any future grant program it is awarded.

Re: Finding 2024-001: Procurement (50000) Nutrition Services currently uses US Foods for the purchase of various commercial food items throughout the year (candy, chips, soda, bread, hotdogs, popcorn, coffee, hot cocoa, churros, cookies, etc). A vast majority of the purchases are for non-program foods for catering or Snack Bar Sales at Fred Kelly Football Stadium. Occasionally, US Foods is used to purchase specialty items for students with food allergies (i.e. gluten free) and baby food for students that require a pureed diet. Nutrition Services compares prices between US Foods and Smart and Final periodically throughout the year. Smart and Final purchases are made in store and Nutrition Services would have to provide pictures of price tags on the shelf at Smart and Final to show compliance with this request. Nutrition Services requested a price quote for products purchased through US Foods. Unfortunately, the company representative told us their prices are variable based on the market and could change weekly. Nutrition Services would only be able to provide auditors of screenshots ofUS Foods online ordering portal, which would consist of hundreds of pages given the expansive foods available. To correct the finding, Nutrition Services will do the following: 1. Request piggybackable formal bid options from US Foods. To that end, the Nutrition Services and Purchasing directors will seek board approval no later than March 1, 2025. 2. Take necessary steps to increase micropurchase threshold to $50,000. 3. Consider opening a Purchase Order with Sysco Foods to spread the micropurchases to another online retailer, thus mitigating the issue of in-person shopping and price comparisons. 4. Work with Purchasing Department to ensure open Purchase Orders do not exceed $50,000 for any vendor that does not have formal procurement in place. To that end, the Nutrition Services Accounting Technician and the Purchasing Supervisor will review quarterly expenditures for all open purchase orders effective December 1, 2024.

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE – U.S. DEPARTMENT OF AGRICULTURE, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, CHILD NUTRITION CLUSTER – FEDERAL ALN 10.553 AND 10.559 2024-001 Internal Control Over Compliance With Federal Suspension and Debarment Requirements Finding Summary - 2 CFR § 180 and 2 CFR § 200.318-327 requires Independent School District No. 719, Prior Lake-Savage Area Schools (the District) to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including suspension and debarment requirements applicable to the child nutrition cluster federal programs. During our audit, we noted the District did not have sufficient controls in place within its child nutrition cluster federal programs to ensure compliance with federal requirements related to assuring that the District was not contracting for goods or services with parties that are suspended or debarred, or whose principals are suspended or debarred from participating in contracts involving the expenditures of federal program funds. Corrective Action Plan Actions Planned – The District will review its policies and procedures relating to suspension and debarment for its federal programs to ensure compliance with the Uniform Guidance in the future. The review of procedures will also include steps to assure that district personnel are following the requirements of the Uniform Guidance related to suspension and debarment, including maintaining appropriate documentation. Official Responsible – The District’s Executive Director of Business Services, Tammy Fredrickson. Planned Completion Date – June 30, 2025. Disagreement With or Explanation of Finding – The District agrees with this finding. Plan to Monitor – The District’s Executive Director of Business Services, Tammy Fredrickson, will assure appropriate internal controls and procedures are in place to ensure compliance with suspension and debarment requirements.

The District will monitor vendors to ensure they are able to accept federal monies. The District will also review all invoices relating to bids to verify correct charges. This will be completed by Ashley Simmons, Accounts Payable Clerk by 6/30/2025.

Management response/corrective action plan: Efficiency Maine has delegated a staff person to work with outside counsel to revise our procurement policy as it relates to federal funds in order to properly address all requirements of the Uniform Guidance.

2024-002: Written Procurment, Suspension and Debarment Policy Finding Condition - The Town of Dayton did not have written controls in place to ensure that vendors were not suspended or debarred or included in the list of vendors prior to entering into a contract with the Town. The written standard of conduct covering conflicts of interest and governing the performance of its employees and contractors must be documented when engaged in the selection, award and adminstration of Federal grant contracts. Corrective Action Plan - Even though the Town didn't have a formal written policy in place regarding the search for suspended or debarred vendors/contractors, the Town did do the SAM's search before signing agreements with contractors on each of the Federal Grant projects that were in place during the year. A policy was written and signed on September 2, 2024.