Corrective Action Plans

COVID-19 - Coronavirus State and Local Relief Funds (CSLRF)-Assistance Listing No. 21.027 Procurement Recommendation: The Town should review and enhance controls and procedures to ensure that it follows the established procurement policy for all goods and services charged to the program and should ensure that all departments are subject to applicable controls, policies and procedures. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The Town will implement procurement processes for goods or services exceeding $10,000 to ensure vendors are selected in a manner providing full and open competition where property or services are being acquired under a Federal award. Name(s) of the contact person(s) responsible for corrective action: Lewis George, Town Administrator Planned completion date for corrective action plan: 01/01/2026

2024-002 Finding Subject: COVID 19: Coronavirus State and Local Fiscal Recovery Funds - IFA Grant - White Ditch– Procurement and Suspension and Debarment Contact Person Responsible for Corrective Action: Mary Lynn Wall Contact Phone Number and Email Address: 219-873-1404 mlwall@emichigancity.com Views of Responsible Officials: We concur with the finding Procurement Federal regula􀆟ons allow for informal procurement methods when the value of the procurement for property or services does not exceed the simplified acquisi􀆟on threshold, which is customarily set at $250,000. However, Indiana Code 5-22-8 has a more restric􀆟ve threshold of $150,000 or less for when small purchase procedures may be used. This informal process allows for methods other than the formal bid process. Micro-purchases are typically for those purchases $10,000 or under, and small purchase procedures are for those purchases above the micro-purchase threshold, but below the simplified acquisi􀆟on threshold. Micro-purchases may be awarded without solici􀆟ng compe􀆟􀆟ve price rate quota􀆟ons. If small purchase procedures are used, then price or rate quota􀆟ons must be obtained from an adequate number of qualified sources. Description of Corrective Action Plan: All purchases need to be made in accordance with the Sanitary District of Michigan City Purchasing Policy. All contracts will be supported by a written and signed contract document per Section 9.0 of the Sanitary District of Michigan City Purchasing Policy. Suspension and Debarment 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)...." 2 CFR 200.320 states in part: "The non-Federal entity must have and use documented procurement procedures, consistent with the standards of this section and §§ 200.317, 200.318, and 200.319 for any of the following methods of procurement used for the acquisition of property or services required under a Federal award or sub-award. (a) Informal procurement methods. When the value of the procurement for property or services under a Federal award does not exceed the simplified acquisition threshold (SAT), as defined in § 200.1, or a lower threshold established by a non-Federal entity, formal procurement methods are not required. The non- Federal entity may use informal procurement methods to expedite the completion of its transactions and minimize the associated administrative burden and cost. The informal methods used for procurement of property or services at or below the SAT include: . . . (b) Formal Procurement Methods. When the value of the procurement for property or services under a Federal financial assistance award exceeds the SAT, or a lower threshold established by a non-Federal entity, formal procurement methods are required. Formal procurement methods require following documented procedures. Formal procurement methods also require public advertising unless a non-competitive procurement can be used in accordance with § 200.319 or paragraph (c) of this section. The following formal methods of procurement are used for procurement of property or services above the simplified acquisition threshold or a value below the simplified acquisition threshold the non-Federal entity determines to be appropriate: . . . (1) Sealed bids. A procurement method in which bids are publicly solicited and a firm fixed-price contract (lump sum or unit price) is awarded to the responsible bidder whose bid, conforming with all the material terms and conditions of the invitation for bids, is the lowest in price. The sealed bids method is the preferred method for procuring construction, if the conditions. . . . (2) Proposals. A procurement method in which either a fixed price or cost-reimbursement type contract is awarded. Proposals are generally used when conditions are not appropriate for the use of sealed bids. . . ." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you do business is not excluded or disqualified. You do this 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." Description of Corrective Action Plan For all federally funded contracts exceeding $25,000, the Vendor will submit a statement indicating they were not suspended or debarred. For purchases not requiring a contract, the City Controller’s office will check the Excluded Parties List System prior to payment to the vendor. Anticipated Completion Date: 08/06/2025

FINDING 2024-001 Finding Subject: COVID-19- Coronavirus State and Local Fiscal Recovery Funds – Procurement and Suspension and Debarment Contact Person Responsible for Corrective Action: Mary Lynn Wall Contact Phone Number and Email Address: 219-873-1404 mlwall@emichigancity.com Views of Responsible Officials: We concur with the finding Procurement Federal regula􀆟ons allow for informal procurement methods when the value of the procurement for property or services does not exceed the simplified acquisi􀆟on threshold, which is customarily set at $250,000. However, Indiana Code 5-22-8 has a more restric􀆟ve threshold of $150,000 or less for when small purchase procedures may be used. This informal process allows for methods other than the formal bid process. Micro-purchases are typically for those purchases $10,000 or under, and small purchase procedures are for those purchases above the micro-purchase threshold, but below the simplified acquisi􀆟on threshold. Micro-purchases may be awarded without solici􀆟ng compe􀆟􀆟ve price rate quota􀆟ons. If small purchase procedures are used, then price or rate quota􀆟ons must be obtained from an adequate number of qualified sources Description of Corrective Action Plan: All purchases need to be made in accordance with the City of Michigan City Purchasing Policy. Purchases made under the Special Purchase provision (I.C.5-22-10-1) will abide by section 7.4 of the Michigan City Purchasing Policy. This section describes the required record keeping. Suspension and Debarment Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)...." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you do business is not excluded or disqualified. You do this 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." 2 CFR 200.320 states in part: (a) "The non-Federal entity must have and use documented procurement procedures, consistent with the standards of this section and §§ 200.317, 200.318, and 200.319 for any of the following methods of procurement used for the acquisition of property or services required under a Federal award or sub-award. Informal procurement methods. When the value of the procurement for property or services under a Federal award does not exceed the simplified acquisition threshold (SAT), as defined in § 200.1, or a lower threshold established by a non-Federal entity, formal procurement methods are not required. The non- Federal entity may use informal procurement methods to expedite the completion of its transactions and minimize the associated administrative burden and cost. The informal methods used for procurement of property or services at or below the SAT include: . . . (2) Small purchases– (i) Small purchase procedures. The acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity. . Description of Corrective Action Plan: For all federally funded contracts exceeding $25,000, the Vendor will submit a statement indicating they were not suspended or debarred. For purchases not requiring a contract, the City Controller’s office will check the Excluded Parties List System prior to payment to the vendor. Anticipated Completion Date: 08/06/2025 INDIANA STATE

Action taken in response to finding: •LMC staff will receive further training in the use of sole source documentation, and the established policies and procedures for purchasing and procurement. •LMC staff responsible for purchasing and agreements will follow the established policy and procedures for procurement. •LMC staff will develop and maintain tracking mechanisms related to the methodology used for each noncompetitive procurement. Name(s) of the contact person(s) responsible for corrective action: Melissa D’Onorio, CEO, and Donna Landy, CFO. Planned completion date for corrective action plan: 07/14/2025

Finding 2024-004 – Procurement (repeat finding): Type: Material Weakness in Internal Control/Noncompliance. Condition: The CMHSP did not follow the formal procurement methods outlined in 2 CFR 200.320 prior to entering into contracts for services under the grant. Also, the CMHSP did not verify that the vendors were not suspended, debarred, or otherwise excluded or disqualified in accordance with 2 CFR requirements prior to entering into a contract for services under the grant. Corrective Action: Current Finance staff will ensure that procurement measures are followed and that vendors are not suspended or debarred or disqualified. Contact Person: Kevin Hartley, CFO Completion date: October 1, 2024

Management of Franciscan Alliance, Inc. and Affiliates (“Franciscan”) considers the implementation and monitoring of effective internal controls to be one of its most important responsibilities, especially as they relate to the funds received from the Federal government. Management has continued to promote sound business practices and effective internal controls across the organization through communication, training, and consistent enforcement of the Franciscan’s policies. The following are the Views and Corrective Action Plans of Management regarding the Schedule of Findings and Questioned Costs for the year ended December 31, 2024 for Franciscan. AUDIT FINDING 2024-001 – Compliance with Reporting Requirements MANAGEMENT’S RESPONSE: Management concurs that the sole source justification was not formally documented prior to the time of procurement. Franciscan’s procurement policy already includes clear criteria for sole source contracting, including the requirement that such procurements be supported by documented justification and approved by the Vice President Supply Chain. The policy outlines specific conditions under which sole source justification is permitted and requires Supply Chain to verify price reasonableness using benchmarking tools or known pricing data. CORRECTIVE ACTION PLAN: Franciscan implemented a new procurement software in the fourth quarter of 2024. The software has a required field for users to select if the procurement is sole-source and if it is, another required field activates for the user to provide a reason for sole-source. Once a procurement request is submitted by the user, the sourcing team reviews the request and verifies it has the appropriate approval if it is sole-sourced. RESPONSIBLE PERSONS: Sarah Burdick, Administrative Director Strategic Sourcing, Franciscan Alliance, Inc. COMPLETION DATE: December 2024

FINDING 2024-002 Finding Subject: Water and Waste Disposal Systems for Rural Communities – Procurement and Suspension and Debarment Contact Person Responsible for Corrective Action: Thomas A. Dippel, CPA Contact Phone Number and Email Address: (812) 683-2211 / ct@huntingburg-in.gov Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: We will work with the City’s attorney to revise its current policy to include federal regulations and procedures related to Procurement and Suspension and Debarment. Once revised, the City will follow its policy to ensure compliance with the compliance requirement. Anticipated Completion Date: September 30, 2025

The College will retain all procurement documentation going forward..

Corrective action planned: Two new policies will be implemented; a board policy to cover board approvals for the bidding of large projects and an internal policy and procedure which spells out additional requirements, like requiring three written bids for large purchases. In addition, all members of the Board of Directors and senior leadership team will sign Conflict of Interest statements on an annual basis to confirm that they do not have any potential conflicts that could impact purchasing decisions. Anticipated completion date: July 31, 2025 Contact person responsible for corrective action: Steve Lindemann, Interim CFO

2024-001 Federal program 10.855 – Distance Learning and Telemedicine Loans and Grants – Procurement, Suspension, and Debarment Condition The County used a noncompetitive procurement method without receiving written approval or meeting one of the other allowable circumstances for a procurement that was greater than a micro-purchase but less than the simplified acquisition threshold. Recommendation Whenever possible, we recommend that the County request written permission from the awarding agency if it seeks to use noncompetitive procurement methods for grants. We also recommend that the County consider updating its procurement policy to make it clear that the circumstances in which noncompetitive procurements can be used with federal assistance differ from normal circumstances. Comments on the Finding Recommendation The County is aware of the finding and will take steps to mitigate the risk of this happening again in the future. Action Taken Before the end of calendar year 2025, the County’s procurement policy will be updated to clarify when noncompetitive methods can be used with federal funding. Additionally, all staff involved with grant management have been instructed to request written documentation from awarding agencies whenever they are attempting to use noncompetitive procurement methods.

Capitalization Grants for Clean Water State Revolving Funds – Assistance Listing No. 66.458 Recommendation: District personnel should familiarize themselves with the documentation requirements required by the CFR related to procurement. In addition, District policies and procedures should be modified to ensure documentation is maintained on the justification for any noncompetitive procurement transactions that are entered into and that the justification is reviewed and approved by someone other than the one making that determination. The written policies should be expanded to clearly address all five procurement methods allowed under Uniform Guidance. The District should also make sure to update its conflict of interest policy to specifically address situations with federal awards and also create written policies and procedures related to suspension and debarment. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned/taken in response to finding: Commissioners will discuss at future regularly scheduled meetings and Clerk/Director will make sure any decisions made include documentation as to why they differ from established policy. Name(s) of the contact person(s) responsible for corrective action: Eric Donaldson Planned completion date for corrective action plan: 31 December 2025

The City will work internally within the City Manager's office and Finance Department to adopt a centralized procurement process and policy that is in line with Uniform Guidance. Staff identified to participate in the process will be trained as necessary.

Corrective Action Plan: Housing Resources, Inc. will review and update the current procurement policy to clarify competitive bidding thresholds and approval process for single source purchases. Once approved by the organization’s Board of Directors, the policy will be reviewed with all staff. Additionally, we will identify a specific staff person to manage vendor and contractor relationships including solicitation, bid process, selection, onboarding, etc. Documentation will be kept throughout the process should bids be required. Anticipated Corrective Action Plan Completion Date: October 31, 2025 Contact Information: For additional information regarding this finding please contact Trena Bond, Executive Director, at (414)461-6330.

Views of Responsible Officials and Planned Corrective Action: Management agrees with this finding and will adopt a formal Federal procurement policy which includes all elements identified in 2CFR Sections 200.303 and 200.318 through 200.626.

Views of Responsible Officials and Planned Corrective Action: Management agrees with this finding and will adopt a formal Federal procurement policy which includes all elements identified in 2CFR Sections 200.303 and 200.318 through 200.626.

FINDING 2024-002 Finding Subject: Coronavirus State and Local Fiscal Recovery Funds - Procurement and Suspension and Debarment Contact Person Responsible for Corrective Action: Darrin Boas Contact Phone Number and Email Address: 812-522-4020; dboas@seymourin.org Views of Responsible Officials: We concur with the findings Description of Corrective Action Plan: Management developed, adopted and implemented a procurement policy for federal purchases that aligns with the requirement of the 2 CFR 200 Uniform Guidance. This process includes steps within the interview and application process to ensure contractors and subrecipients are eligible (not suspended, debarred, or otherwise excluded) to enter into an agreement, contract, or subaward with the City. The contract in question was agreed to during last year’s audit and part of an overall project/grant overseen by Schneck Hospital entered into in 2021. Going forward, the Clerk Treasurer will review the agreements with the vendors who are being paid from federal grant monies to ensure that the procurement policy is being followed and proper documentation is being obtained based on the procurement method. Anticipated Completion Date: Completed. The City adopted Ordinance 35 on November 25, 2024. This was the effective date of correction.

Going forward, we will obtain and retain quotes via email and ensure that a sufficient number of qualified sources are solicited, in accordance with procurement guidelines.

Description: Significant deficiency in procurement compliance. Planned Corrective Action: CGS will revise its internal procurement policies to ensure that all amounts, regardless of vendor or how they will be charged within the accounting system over the micro-purchase threshold, currently $10,000.00, be considered in the aggregate and formally bid out accordingly with written responses retained internally as support. Additionally, in cases where specific agency approval is required for a procurement, such will be obtained before any awards are made. Completion Date: October 1, 2025 Responsible Person: Keith Peregonov, VP for Finance, Human Resources and Operations

Recommendation: We recommend the Organization consistently follow its established policies and procedures related to the maintaining of necessary documentation to support the method of procurement utilized. The Organization may also consider qualifying multiple vendors for particular goods/service and then utilizing an approved vendors list. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned in response to finding: Management and finance staff will more closely monitor when non-payroll expenditures are charged to federal grants and adhere to procurement policy when over the required threshold that requires board approval over equipment, supplies, and services $10,000 and 3 written bids when over $100,000. Additionally, finance staff will seek out training from contracted third-party consultant when documenting procurement items to ensure that all documentation required is maintained. Further, the procurement policy will be reviewed on a regular basis to ensure that personnel involved in procurement are educated in regards to the policy and procedures. Name(s) of the contact person(s) responsible for corrective action: Jeremy Runde, Controller Planned completion date for corrective action plan: June 2025

FINDING 2024-03 Finding Subject: Water and Waste Disposal System for Rural Communities - Procurement and Suspension and Debarment Contact Person Responsible for Corrective Action: Beth Jones Contact Phone Number and Email Address: 812 723-2739, clerk@paoli.in.gov Views of Responsible Officials: We concur with the findings Description of Corrective Action Plan: The Clerk Treasurer will work with the council and town attorney to make sure we are following the procurement policy and that we are compliant with the Federal and State guidelines. If a new project or a current project is being extended to a significant amount; during a council meeting, we will state that we are retaining a certain vendor for the project and explain why we are using that vendor. Anticipated Completion Date: August 1, 2025

In FY24, the Food Service Department piloted a recurring “Pizza Friday” program as part of its student lunch offerings. The District utilized Domino’s due to its demonstrated reliability, familiarity with school food service requirements, and consistent performance. The total annual cost of the purchases exceeded the federal micro-purchase threshold of $5,000. As a result of this finding, the District has updated its internal procurement practice to ensure multiple quotes and/or participation in approved consortiums and purchasing co-ops for services anticipated to exceed this cost. Additionally, the Board has updated policy to increase the threshold from $5,000 to $10,000.

Single Audit Finding: 2024-001 Federal Agency Name: Colorado Department of Transportation  Program Name: Formula Grants for Rural Areas and Tribal Transit CFDA #: 20.509 Finding Summary: Procurement and Suspension and Debarment, Significant Deficiency in Internal Control over Compliance. Responsible Individuals: Heidi Wise - Acting Deputy Chief Financial Officer, Marisa Rupp - Grants and Contracts Specialist, Bob Grogan - Purchasing Manager, Sarah Hill - Transportation Director, Calia Kimball - Transportation Specialist Corrective Action Plan: The City of Durango concurs with this finding and has planned steps to strengthen its internal controls related to procurement and suspension and debarment. In response, the City will implement a formal, standardized procurement process for these services, in coordination with the Risk Management division. This process will be adopted on a citywide basis and occur annually to ensure consistent application and compliance with federal and state regulations. To further reinforce compliance and oversight, a citywide Request for Proposals (RFP) for these types of services will be initiated in the coming weeks. The Transportation Director will coordinate with the Safety/Risk Administrator to lead this effort. Additionally, the City has scheduled an organization-wide training session to reinforce key procurement policies and best practices, with a focus on suspension and debarment compliance. Additionally, a new Purchasing Policy was adopted in early 2025, which includes enhanced documentation and verification requirements, specifically addressing procurement documentation - suspension and debarment checks for vendors. These measures are designed to ensure compliance with applicable procurement standards and reduce the risk of future deficiencies. Ongoing training and monitoring will be conducted to verify continued adherence and to promote accountability across all departments. Anticipated Completion Date: Implementation activities for the procurement in question, will begin in the coming weeks, with the RFP process and staff training scheduled for completion in the third quarter of 2025.

The City concurs with the observation and will implement procedures in 2025 as recommended.

Views of Responsible Officials: FASEB acknowledges the findings identified by the audit regarding procurement and suspension and debarment. We recognize the importance of maintaining adequate records of the procurement process to ensure compliance with federal regulations and to promote transparency and accountability in our operations. Managements Response to Audit Finding on inadequate recording of procurement history or justification: 1. Review and Update Procurement Policies:  We will conduct a thorough review of our current procurement policies and procedures to identify any gaps or areas requiring improvement.  Updates will be made to ensure that our procurement policies align with federal regulations, including those related to suspension and debarment. 2. Training for Staff:  We will provide comprehensive training for all staff involved in the procurement process to ensure they understand the updated policies and the importance of maintaining proper records.  Training will include guidance on documentation requirements, vendor selection criteria, and compliance with federal regulations. 3. Implementation of Record-Keeping System:  We will implement a centralized, secure, and user-friendly record-keeping system to document all procurement activities.  This system will include templates and checklists to guide staff in capturing all necessary information, including vendor selection, bid evaluations, contract awards, and verification of suspension and debarment status. 4. Regular Monitoring and Audits:  We will establish a schedule for regular internal audits of the procurement process to ensure ongoing compliance and to identify any potential issues promptly.  Findings from these audits will be reviewed by senior management, and corrective actions will be taken as needed. 5. Vendor Verification:  We will enhance our procedures for verifying the suspension and debarment status of potential vendors before awarding contracts.  This verification process will be documented and retained as part of the procurement records. Conclusion: FASEB is committed to addressing the findings related to procurement and suspension and debarment. We believe that the steps outlined in our corrective action plan will ensure compliance with Federal regulations and enhance the integrity and transparency of our procurement process. We appreciate the opportunity to improve our practices and will provide updates on our progress as requested.

Year Ended: October 31, 2024 Finding Number: 2024-001 Name oflndividual Responsible for Correction Action: Alissa Rodgers, CFO Cause: Austin Street was previously in compliance due to using a Sole Source Provider for Food that provided the food services as well as the food supply vendors. August Street discontinued services with the food service provider however maintained the food supply vendors. Since they were not new vendors it was misunderstood to pass those vendors through procurement once again since the sole source was no longer connected to the food program. Corrective Action Plan: On April 17, 2025, Austin Street Center's business office has published and distributed an RFP for food vendors to comply with procurement requirements as food costs are usually more than $250,000 per year. ProcW"ement Processes have been followed in all other areas of the organization and Austin Street is placing month end procedures in place to ensure no vendors unexpectedly rise above thresholds that require additional procurement or analysis.