Corrective Action Plans

2024-004 Views of Responsible Officials and Planned Corrective Actions: Management agrees with the recommendation and has implemented measures to improve procurement recordkeeping and compliance. A structured procurement folders and subfolders system has been established to maintain all relevant documentation. Management is actively working with consultants to update policies and procedures. Staff is scheduled to complete a structured three-session training through GFOA to enhance their understanding of federal procurement regulations and best practices. The District will continue training and development efforts in public procurement, with a particular focus on federal compliance, strengthening internal controls, improving documentation, and ensuring adherence to regulatory requirements Responsible Party: Director of Finance & Administration and Department Managers Implementation Date: Ongoing; full implementation expected by June 30, 2025

The Department of Public Works, will incorporate the Federal Statement of Compliance form (C-56) within the Technical Specifications section of all federally-funded VDOT project contracts.

Finding 2024-001 Written Procurement Polley- This finding impacts the procurement and suspension and debarment compliance requirement for the major program, Assistance Listing Number 10.555 National School Lunch Program (Child Nutrition Cluster) funded by the Commonwealth of Massachusetts Department of Elementary and Secondary Education (DESE). Nurtury should revise its procurement policy to comply with Uniform Guidance requirements and implement policies and procedures to search for suspended or debarred vendors on Sam.gov. Fiscal Year 2025. Procurement policy is in accordance with Uniform Guidance requirements. Management and the finance committee of the board will ensure that revised procurement policies are in accordance with Uniform Guidance requirements. Tubi Olatubosun, V.P. of Finance

Finding 2024-004 US Department of Treasury Federal Financial Assistance Listing 21.027 All Awards State and Local Fiscal Recovery Funds Finding Summary: Both of these two deficiencies will be dealt with through an updated procurement policy as well as a check list to ensure contracts comply with all federal guidelines. In addition, all processes needed to ensure compliance will be updated or created as needed. This recommendation has been partially implemented. The procurement policy has been updated and the processes are currently under review to be completed prior to 7/31/2025.

Finding 2024-003 US Department of Treasury Federal Financial Assistance Listing 21.027 All Awards State and Local Fiscal Recovery Funds Finding Summary: Both of these two deficiencies will be dealt with through an updated procurement policy as well as a check list to ensure contracts comply with all federal guidelines. In addition, all processes needed to ensure compliance will be updated or created as needed. This recommendation has been partially implemented. The procurement policy has been updated and the processes are currently under review to be completed prior to 7/31/2025.

The District has created a standard operating procedure document to follow for all construction projects. The District will also share that document with all contractors to help communicate the needs of the District regarding construction projects. If necessary, the District will provide the contractor with training to make sure all payrolls are properly certified and in compliance with applicable law. The District will also create a shared Google document for each construction project to manage the progress and payments.

Name of contact person and title: Deepak Butani, CFO Response: The Organization has engaged a professional services firm in a consulting engagement to review and assist in revising their procurement policy to align its policies and procedures for procurement with Uniform Guidance. Anticipated completion date: 6/30/2025

Corrective Action Plan Finding 2024-001 Criteria: Recipients of federal awards must follow the procurement standards set out at 2 CFR section 200.317 through 200.326. They must use their own documented procurement procedures, which reflect applicable State laws and regulations, provided that the procedures conform to applicable Federal law and the procurement requirements identified in 2 CFR part 200. Recipients “must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to the following: rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price” 2 CFR section 200.318(i). The School’s procurement procedures include the requirement to maintain sufficient documentation of the history of procurement. The School also has procedures to identify procurement transactions requiring competitive bids or proposals. Auditor Recommendation: We recommend the Academy ensure it 1) maintains documentation of the history of procurement and 2) monitors compliance with documentation requirements. Auditee Response/ Corrective Action Plan: The Academy will review its procurement policies and internal controls and ensure timely action is taken when noncompliance is identified. Person Responsible: Dane Roberts, Executive Director and Randi Limb, Business Manager Timeline: All future contract solicitations will follow the required procurement standards.

We concur with the condition. 1. Name of the contact person responsible for corrective action: Grants Manager and Project Manager 2. Corrective action planned: Grants Manager will work in conjunction with the Project Manager to ensure the following when federal monies are used for construction projects: ● Determine the project will exceed $2,000 and will qualify under Davis-Bacon-Act ● Confirm the prevailing wage and include it in each solicitation to contractors ● Notify contractors that Davis-Bacon-Act must be followed at the time of reaching out for a project bid ● Collect and file weekly payroll statements from the contractor until the project is finished ● Include assurances in federal projects that Davis-Bacon-Act was followed ● Report all suspected or reported violations to the Federal awarding agency 3. Anticipated completion date: July 1, 2025.

This is the result of a contract that was signed for engineering work on the Grass Valley Nitrate Mitigation project. Individuals involved in the procurement process incorrectly relied on NRS requirements governing professional services contracts and did not go out to bid for the services. Additionally, Humboldt County serves as the financial processor for the Humboldt River Basin Water Authority Advisory Board. The HRBWA received grant funds for the water right relinquishment program through the State of Nevada Division of Water Resources. The County will enhance communication with the executive director of the HRBWA to ensure that all procurement processes are followed and documented.

Finding 2024-001 Federal Department: Department of Labor Assistance Listing #: 17.274 Material Weakness in Internal Controls and Noncompliance Category of Finding – Procurement, Suspension, and Debarment Finding Summary: There was no observable control documentation to directly indicate that a search for price comparisons or suspension and debarment was performed on vendors. Responsible Individuals: Jill Johnson, Executive Director Corrective Action Plan: Our Executive Director and Controller developed an updated procurement policy. This policy went into effect on July 1, 2024 and has been implemented throughout the organizational system. Anticipated Completion Date: July 1, 2024

Finding 2024-002 Procurement and Suspension and Debarment (Compliance) – 2020 Findings Major Federal Award Programs Condition The City's procurement standards do not include the essential elements as outlined in 2 CFR sections 200.318 through 200.326. Corrective Action Plan The City issued and updated purchasing policy which includes the CFR requirements in early fiscal year 2024-2025. The city has hired adequate staffing which allows the purchasing department to enforce the suspension and debarment process during the procurement process. The City will have a formal process to require checking for Procurement and Suspension and Debarment prior to any contracts being issued. The policy will include but not limited to: 1. Bidding/RFP requirements: Prior to making a grant-related purchase, the procurement office will check the selected vendor on www.sam.gov prior to approving. The procurement office will document the Suspension and Debarment verification by including a screen print of the Exclusions search. 2. Annual check Annually, procurement will run a list of all vendors and employees paid from federal funds. This list will be reviewed against sam.gov, unless set up one month prior to the review. 3. Notification in bid/RFP specifications The procurement office will also make sure to include language in the specification about complying with CFR rules for federal funding. The implementation of this recommendation is monitored by the Procurement Director and Finance Director Michael Gormany or designee.

2024-001 (Procurement and Suspension & Debarment) Management Comments and Corrective Action: Due to the growing need to adequately care for the minors at SWK’s shelters coupled with the limitations of access to vendors caused by COVID-19, SWK utilized existing vendor to minimize significant disruptions to operations. The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Reprocuring all of these contracts at once would potentially cause disruptions in operations due to the products/services related to those vendors playing an important role in the Organization’s dayto- day operations. In April 2021, the Organization hired new procurement leadership and invested in Full Time Employees (FTEs) to develop a robust procurement department. Due to this procurement revamp, Procurement adopted a hybrid model, and Desktop Protocols were established to provide universal procedures to fulfill policy. Protocols instruct staff on obtaining three quotes and provide tools for selecting the vendor. In addition, quality protocols and tools are currently in development to verify a random sample of procurement transactions and files. The Organization still has several active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Proposed Implementation Date of Corrective Action: In process and to be completed by December 31, 2025. Person Responsible for Corrective Action: Steven Beckman, CFO 45

UNITED STATES DEPARTMENT OF THE TREASURY 2024-001 COVID-19 – American Rescue Plan Act – Assistance Listing No. 21.027 Recommendation: We recommend that the Town review its formal procurement policies and revise with the criteria in 2 CFR sections 200.318 and 200.326. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The Town was checking for disbarred vendors, but did not date or track when the searches were done. Going forward, a spreadsheet will be kept of vendors and date of search on SAM.gov. Name(s) of the contact person(s) responsible for corrective action: Julie Chapman Planned completion date for corrective action plan: June 30, 2025

The Clinic will review the procurement standards set forth at 2 CFR part 200 and has updated our procurement and purchasing policies to comply with all required purchasing standards. All vendors will be required to submit and certify a statement regarding debarment and suspension prior to contract award. The anticipated completion date is 09/30/2025.

The City of Bardstown places a high priority on fiar and equitable purchasing practices. The General Bidding Statue (KRS 424.260) governs purchases made during the normal course of business. The City acknowledges the need to adopt a written purchasing policy to set qualifications and procedures when federal funds are being utilized. A purchasing policy is currently being drafted to adopt procurement standards found in 2 CFR 200.317 through 200.326. This policy will be presented to council and adopted prior to February 28, 2025.

Management concurs with this finding. Management has taken steps to review and revise its procurement policies to comply with state and local laws, the standards of the CFO, as well as current operating procedures. The fining relates to contracts that were originally procured prior to the change in policies, with only renewals in the financial statement periods. Going forward, Management will document basis for procurement for renewals of contracts that originated prior to the new policies and procedures implementation.

Findings and Questioned Costs Related to Federal Awards Finding Number: 2024‐001 Program Name/Assistance Listing Title: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Contact Person: Cheryl Burt, Director of Purchasing; Courtney Pina, Executive Director of Finance Anticipated Completion Date: Ongoing Planned Corrective Action: Issue Identified – The District failed to follow Federal, State, and Board policies and regulations governing procurement when procuring a multi‐year professional development support services contract for $111,200. Instead of issuing a formal procurement process, the District used quotes, which did not meet compliance requirements under 2 CFR §§200.318–200.326. Actions Taken to Address the Finding 1. Immediate Remedial Actions o Contract Review: Conducted a thorough review of the contract in question and determined steps to ensure compliance with applicable policies. o Internal Notification: Informed all relevant staff and departments about the compliance violation to prevent similar issues in the future. 2. Policy Review and Alignment o Procurement Policy Review: Conducted a comprehensive review of internal procurement policies to ensure alignment with federal requirements outlined in 2 CFR §§200.318–200.326, as well as applicable state and board requirements. o Threshold Verification: Confirmed that all documented thresholds for procurement types (e.g., formal procurement, quotes) are clearly stated in district policies to ensure consistency and compliance. Actions Planned to Prevent Future Occurrences 1. Training and Awareness o Staff Training: Implement mandatory training for staff involved in procurement processes to ensure familiarity with federal, state, and board regulations. Training sessions will emphasize formal procurement thresholds and the procedures for multi‐year contracts. o Annual Refresher Training: Conduct annual training sessions to maintain staff awareness of procurement requirements and reinforce adherence. 2. Strengthening Internal Controls o Requisition Review: Implement an enhanced approval process requiring multiple levels of review for all procurement transactions exceeding $50,000 to ensure compliance before purchase. o Checklist Requirement: Provide approvers with a compliance checklist verifying adherence to federal, state, and board procurement requirements before approving requisitions. 3. Ongoing Monitoring o Quarterly Audits: Schedule quarterly internal audits of procurement transactions to verify compliance with established policies and identify any gaps early.

Description of Finding: The City’s procurement standards do not include the essential elements as outlined in 2 CFR sections 200.318 through 200.326. Statement of Concurrence or Nonconcurrence: Management agrees with this finding. Corrective Action: Management has implemented a revised procurement policy which complies with Uniform Guidance. However, it was not in place until June 2024. Name of Contact Person: Jared Schmitt, Chief Financial Officer Projected Completion Date: June 30, 2025

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

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

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.

The District is in the process of developing a procurement policy, including prevailing wage rate requirements and will ensure that subcontractors meet the requirements.

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

The District will implement a process to obtain, review and retain certified payrolls if ever using federal funds on future construction contracts in excess of $2,000. The District will work with the contractor to obtain and review the certified payrolls to determine the contractor is in compliance.