FINDING 2023-029 Coronavirus State and Local Fiscal Recovery Funds, ALN 21.027, Procurement and Suspension and Debarment - Suspension and Debarment Process See Schedule of Findings and Questioned Costs for chart/table. Condition MDE did not have an adequate process to ensure the Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) subrecipients were not suspended or debarred prior to its plans to enter into grant agreements for 3 of the 5 sampled subrecipients. Criteria Federal regulation 2 CFR 180.300 requires when MDE enters into a covered transaction with a subrecipient with whom it plans to do business, it must verify that the subrecipient is not suspended or debarred. This can be accomplished by checking the federal website, collecting a certification, or adding a clause or condition to the covered transaction agreement. Cause For 2 subrecipients, MDE believes the reference to the entire Uniform Guidance (federal regulation 2 CFR 200) in the grant agreement constitutes verification the subrecipients are not suspended or debarred; therefore, MDE did not add a specific suspension or debarment clause or cite the specific suspension and debarment regulation (federal regulation 2 CFR 200.214). For the other subrecipient, MDE informed us its process was not always sufficient to ensure document retention of its verification to the federal website. Effect An increased risk exists that MDE could provide grant funds to suspended or debarred subrecipients. The federal grantor agency could issue sanctions or disallowances related to noncompliance. Known Questioned Costs None. We reviewed the federal website and noted these 3 subrecipients were not suspended or debarred; therefore, we did not question the costs. Recommendation We recommend MDE establish an adequate process to ensure CSLFRF subrecipients are not suspended or debarred prior to its plans to enter into grant agreements. Management Views MDE agrees with the finding.
Finding 2023-003: Suspension and Debarment Information About the Program: All Programs Criteria: As stated in 2 CFR §200.303, the non-Federal entity (i.e. NFHA) must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and 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 in the “Internal Control Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). According to 2 CFR §200.214, the non-Federal entity is subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: During our audit, we noted NFHA did not perform checks via SAM.gov to ensure that potential vendors, contractors, or consultants are suspended or debarred. The failure to screen such parties increases the possibility that U.S. Government funds may inadvertently be provided to individuals or organizations deemed to be excluded by the U.S. Government. Cause: Management did not have effective internal controls in place to ensure that suspension and debarment checks were being performed prior to entering into contracts with vendors or contractors/ consultants.Potential Effect: NFHA is exposed to an increased risk that future noncompliance could occur by entering into transactions with vendors, contractors, or consultants that are suspended, debarred, or otherwise excluded from contracting with the U.S. Federal Government. If a non-Federal entity knowingly does business with an excluded person, the agency responsible for NFHA's funding may disallow costs, annul or terminate the transaction, issue a stop work order, debar or suspend NFHA, or take other remedies as appropriate. Questioned Costs: None. Context: NFHA failed to perform its due diligence with respect to these requirements. The issue is considered systemic in nature. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend NFHA implement internal controls to ensure that all vendors, contractors, and consultants are screened for suspension and debarment prior to entering into any executed contract. We further recommend that a policy be formalized and implemented that requires an annual screening, at a minimum, of any current vendors, contractors, or consultants as well.
Finding 2023-003: Suspension and Debarment Information About the Program: All Programs Criteria: As stated in 2 CFR §200.303, the non-Federal entity (i.e. NFHA) must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and 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 in the “Internal Control Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). According to 2 CFR §200.214, the non-Federal entity is subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: During our audit, we noted NFHA did not perform checks via SAM.gov to ensure that potential vendors, contractors, or consultants are suspended or debarred. The failure to screen such parties increases the possibility that U.S. Government funds may inadvertently be provided to individuals or organizations deemed to be excluded by the U.S. Government. Cause: Management did not have effective internal controls in place to ensure that suspension and debarment checks were being performed prior to entering into contracts with vendors or contractors/ consultants.Potential Effect: NFHA is exposed to an increased risk that future noncompliance could occur by entering into transactions with vendors, contractors, or consultants that are suspended, debarred, or otherwise excluded from contracting with the U.S. Federal Government. If a non-Federal entity knowingly does business with an excluded person, the agency responsible for NFHA's funding may disallow costs, annul or terminate the transaction, issue a stop work order, debar or suspend NFHA, or take other remedies as appropriate. Questioned Costs: None. Context: NFHA failed to perform its due diligence with respect to these requirements. The issue is considered systemic in nature. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend NFHA implement internal controls to ensure that all vendors, contractors, and consultants are screened for suspension and debarment prior to entering into any executed contract. We further recommend that a policy be formalized and implemented that requires an annual screening, at a minimum, of any current vendors, contractors, or consultants as well.
Finding 2023-003: Suspension and Debarment Information About the Program: All Programs Criteria: As stated in 2 CFR §200.303, the non-Federal entity (i.e. NFHA) must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and 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 in the “Internal Control Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). According to 2 CFR §200.214, the non-Federal entity is subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: During our audit, we noted NFHA did not perform checks via SAM.gov to ensure that potential vendors, contractors, or consultants are suspended or debarred. The failure to screen such parties increases the possibility that U.S. Government funds may inadvertently be provided to individuals or organizations deemed to be excluded by the U.S. Government. Cause: Management did not have effective internal controls in place to ensure that suspension and debarment checks were being performed prior to entering into contracts with vendors or contractors/ consultants.Potential Effect: NFHA is exposed to an increased risk that future noncompliance could occur by entering into transactions with vendors, contractors, or consultants that are suspended, debarred, or otherwise excluded from contracting with the U.S. Federal Government. If a non-Federal entity knowingly does business with an excluded person, the agency responsible for NFHA's funding may disallow costs, annul or terminate the transaction, issue a stop work order, debar or suspend NFHA, or take other remedies as appropriate. Questioned Costs: None. Context: NFHA failed to perform its due diligence with respect to these requirements. The issue is considered systemic in nature. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend NFHA implement internal controls to ensure that all vendors, contractors, and consultants are screened for suspension and debarment prior to entering into any executed contract. We further recommend that a policy be formalized and implemented that requires an annual screening, at a minimum, of any current vendors, contractors, or consultants as well.
Failure to Follow Procurement Policy Finding 2023-003 Condition: The Authority did not comply with the current procurement policy as procedures were not fully followed and forms required by the Authority’s procurement policy were not completed. The following forms required by either 2 CFR 200 and/or the Authority’s own procurement policy were not completed for the current year capital asset purchases: Written Record of Procurement Checklist Form, Method of Procurement Decision Matrix, Advertisement and Solicitation Form, Bid Quotations, Fewer Than 3 Offers Received Evaluation if applicable, Proposal Tabulation, Certification of Compliance with Federal Clauses for the assets less than $25,000, and Responsibility Determination (sam.gov debarred verification). Also, as stated in the prior finding, the procurement policy needs to be updated. Criteria: According to 2 CFR 200.214 Suspension and Debarment, Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The following excerpts are from 2 CFR Part 200.318 General Procurement Standards. (a) The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in §§ 200.317 through 200.327. (i) the non-Federal entity 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. According to 2 CFR 200.320 Methods of Procurement to be Followed, 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. Concurrently, the Authority’s did not comply with its own current procurement policy as it did not follow or prepare the required documentation detailed in the following sections. Procurement Requests-The Authority will maintain sufficient records to detail the history of a procurement. Such records shall include method of procurement, selection of contract type, contractor selection (or rejection), and the contract price. The Authority will treat any prospective contractor or sub-contractor listed on a centralized State government debarment and suspension list as nonresponsible and ineligible for contract award. Debarment and Suspension- The Authority will treat any prospective contractor or sub-contractor listed on a centralized State government debarment and suspension list as non-responsible and ineligible for contract awards. To see if a prospective contractor is eligible, we will look on the website www.SAM.gov and when the bid has been received. Methods of Procurement- a. Micro and Emergency Purchases (do not exceed $10,000)-(a) A written determination as to why price is deemed fair and reasonable must be on file with each purchase made under this method of procurement using Micro-Purchase Price Reasonableness Determination Form. (b) Splitting of procurements to avoid the competitive procurement requirements of federal and state statues shall not be condoned. b. Small Purchase Procurement ($10,000 to $250,000)-(a) A minimum of two price or rate quotations shall be obtained from qualified sources; (b) The procurement will be made from the lowest priced qualified bid, if products or goods are equal; (c) MDOT requires for procurements under $25,000.00. Included Procurement Appendix A, B, E, F, G, H, or I and Vehicle Specification certification if applies. (d) MDOT requires for procurements over $25,000.00 solicitations, including specifications and written selection procedures (lowest bids), Include Procurement Appendix A, F, G, H or I and Vehicle Specification certification if applies. Third Party Contracts with applicable clauses and bond documents must be included. Cause: The Authority did not follow its own procurement policy. Effect: The Authority is noncompliant with 2 CFR 200 and its own procurement policy. Directive: We direct the Authority review and update its procurement policy and implement procedures to ensure that the Authority is complying with the federal requirements, required forms are being completed, and documentation is being maintained. Management’s Response--Corrective Action Plan: Contact person is Rufus Adams, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority will review and update its procurement policy to comply with federal requirements. The Authority’s management, consultant, and finance director will review the procedures in the policy to ensure they are being acted upon accordingly going forward.
Failure to Follow Procurement Policy Finding 2023-003 Condition: The Authority did not comply with the current procurement policy as procedures were not fully followed and forms required by the Authority’s procurement policy were not completed. The following forms required by either 2 CFR 200 and/or the Authority’s own procurement policy were not completed for the current year capital asset purchases: Written Record of Procurement Checklist Form, Method of Procurement Decision Matrix, Advertisement and Solicitation Form, Bid Quotations, Fewer Than 3 Offers Received Evaluation if applicable, Proposal Tabulation, Certification of Compliance with Federal Clauses for the assets less than $25,000, and Responsibility Determination (sam.gov debarred verification). Also, as stated in the prior finding, the procurement policy needs to be updated. Criteria: According to 2 CFR 200.214 Suspension and Debarment, Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The following excerpts are from 2 CFR Part 200.318 General Procurement Standards. (a) The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in §§ 200.317 through 200.327. (i) the non-Federal entity 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. According to 2 CFR 200.320 Methods of Procurement to be Followed, 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. Concurrently, the Authority’s did not comply with its own current procurement policy as it did not follow or prepare the required documentation detailed in the following sections. Procurement Requests-The Authority will maintain sufficient records to detail the history of a procurement. Such records shall include method of procurement, selection of contract type, contractor selection (or rejection), and the contract price. The Authority will treat any prospective contractor or sub-contractor listed on a centralized State government debarment and suspension list as nonresponsible and ineligible for contract award. Debarment and Suspension- The Authority will treat any prospective contractor or sub-contractor listed on a centralized State government debarment and suspension list as non-responsible and ineligible for contract awards. To see if a prospective contractor is eligible, we will look on the website www.SAM.gov and when the bid has been received. Methods of Procurement- a. Micro and Emergency Purchases (do not exceed $10,000)-(a) A written determination as to why price is deemed fair and reasonable must be on file with each purchase made under this method of procurement using Micro-Purchase Price Reasonableness Determination Form. (b) Splitting of procurements to avoid the competitive procurement requirements of federal and state statues shall not be condoned. b. Small Purchase Procurement ($10,000 to $250,000)-(a) A minimum of two price or rate quotations shall be obtained from qualified sources; (b) The procurement will be made from the lowest priced qualified bid, if products or goods are equal; (c) MDOT requires for procurements under $25,000.00. Included Procurement Appendix A, B, E, F, G, H, or I and Vehicle Specification certification if applies. (d) MDOT requires for procurements over $25,000.00 solicitations, including specifications and written selection procedures (lowest bids), Include Procurement Appendix A, F, G, H or I and Vehicle Specification certification if applies. Third Party Contracts with applicable clauses and bond documents must be included. Cause: The Authority did not follow its own procurement policy. Effect: The Authority is noncompliant with 2 CFR 200 and its own procurement policy. Directive: We direct the Authority review and update its procurement policy and implement procedures to ensure that the Authority is complying with the federal requirements, required forms are being completed, and documentation is being maintained. Management’s Response--Corrective Action Plan: Contact person is Rufus Adams, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority will review and update its procurement policy to comply with federal requirements. The Authority’s management, consultant, and finance director will review the procedures in the policy to ensure they are being acted upon accordingly going forward.
Failure to Follow Procurement Policy Finding 2023-003 Condition: The Authority did not comply with the current procurement policy as procedures were not fully followed and forms required by the Authority’s procurement policy were not completed. The following forms required by either 2 CFR 200 and/or the Authority’s own procurement policy were not completed for the current year capital asset purchases: Written Record of Procurement Checklist Form, Method of Procurement Decision Matrix, Advertisement and Solicitation Form, Bid Quotations, Fewer Than 3 Offers Received Evaluation if applicable, Proposal Tabulation, Certification of Compliance with Federal Clauses for the assets less than $25,000, and Responsibility Determination (sam.gov debarred verification). Also, as stated in the prior finding, the procurement policy needs to be updated. Criteria: According to 2 CFR 200.214 Suspension and Debarment, Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The following excerpts are from 2 CFR Part 200.318 General Procurement Standards. (a) The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in §§ 200.317 through 200.327. (i) the non-Federal entity 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. According to 2 CFR 200.320 Methods of Procurement to be Followed, 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. Concurrently, the Authority’s did not comply with its own current procurement policy as it did not follow or prepare the required documentation detailed in the following sections. Procurement Requests-The Authority will maintain sufficient records to detail the history of a procurement. Such records shall include method of procurement, selection of contract type, contractor selection (or rejection), and the contract price. The Authority will treat any prospective contractor or sub-contractor listed on a centralized State government debarment and suspension list as nonresponsible and ineligible for contract award. Debarment and Suspension- The Authority will treat any prospective contractor or sub-contractor listed on a centralized State government debarment and suspension list as non-responsible and ineligible for contract awards. To see if a prospective contractor is eligible, we will look on the website www.SAM.gov and when the bid has been received. Methods of Procurement- a. Micro and Emergency Purchases (do not exceed $10,000)-(a) A written determination as to why price is deemed fair and reasonable must be on file with each purchase made under this method of procurement using Micro-Purchase Price Reasonableness Determination Form. (b) Splitting of procurements to avoid the competitive procurement requirements of federal and state statues shall not be condoned. b. Small Purchase Procurement ($10,000 to $250,000)-(a) A minimum of two price or rate quotations shall be obtained from qualified sources; (b) The procurement will be made from the lowest priced qualified bid, if products or goods are equal; (c) MDOT requires for procurements under $25,000.00. Included Procurement Appendix A, B, E, F, G, H, or I and Vehicle Specification certification if applies. (d) MDOT requires for procurements over $25,000.00 solicitations, including specifications and written selection procedures (lowest bids), Include Procurement Appendix A, F, G, H or I and Vehicle Specification certification if applies. Third Party Contracts with applicable clauses and bond documents must be included. Cause: The Authority did not follow its own procurement policy. Effect: The Authority is noncompliant with 2 CFR 200 and its own procurement policy. Directive: We direct the Authority review and update its procurement policy and implement procedures to ensure that the Authority is complying with the federal requirements, required forms are being completed, and documentation is being maintained. Management’s Response--Corrective Action Plan: Contact person is Rufus Adams, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority will review and update its procurement policy to comply with federal requirements. The Authority’s management, consultant, and finance director will review the procedures in the policy to ensure they are being acted upon accordingly going forward.
Failure to Follow Procurement Policy Finding 2023-003 Condition: The Authority did not comply with the current procurement policy as procedures were not fully followed and forms required by the Authority’s procurement policy were not completed. The following forms required by either 2 CFR 200 and/or the Authority’s own procurement policy were not completed for the current year capital asset purchases: Written Record of Procurement Checklist Form, Method of Procurement Decision Matrix, Advertisement and Solicitation Form, Bid Quotations, Fewer Than 3 Offers Received Evaluation if applicable, Proposal Tabulation, Certification of Compliance with Federal Clauses for the assets less than $25,000, and Responsibility Determination (sam.gov debarred verification). Also, as stated in the prior finding, the procurement policy needs to be updated. Criteria: According to 2 CFR 200.214 Suspension and Debarment, Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The following excerpts are from 2 CFR Part 200.318 General Procurement Standards. (a) The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in §§ 200.317 through 200.327. (i) the non-Federal entity 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. According to 2 CFR 200.320 Methods of Procurement to be Followed, 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. Concurrently, the Authority’s did not comply with its own current procurement policy as it did not follow or prepare the required documentation detailed in the following sections. Procurement Requests-The Authority will maintain sufficient records to detail the history of a procurement. Such records shall include method of procurement, selection of contract type, contractor selection (or rejection), and the contract price. The Authority will treat any prospective contractor or sub-contractor listed on a centralized State government debarment and suspension list as nonresponsible and ineligible for contract award. Debarment and Suspension- The Authority will treat any prospective contractor or sub-contractor listed on a centralized State government debarment and suspension list as non-responsible and ineligible for contract awards. To see if a prospective contractor is eligible, we will look on the website www.SAM.gov and when the bid has been received. Methods of Procurement- a. Micro and Emergency Purchases (do not exceed $10,000)-(a) A written determination as to why price is deemed fair and reasonable must be on file with each purchase made under this method of procurement using Micro-Purchase Price Reasonableness Determination Form. (b) Splitting of procurements to avoid the competitive procurement requirements of federal and state statues shall not be condoned. b. Small Purchase Procurement ($10,000 to $250,000)-(a) A minimum of two price or rate quotations shall be obtained from qualified sources; (b) The procurement will be made from the lowest priced qualified bid, if products or goods are equal; (c) MDOT requires for procurements under $25,000.00. Included Procurement Appendix A, B, E, F, G, H, or I and Vehicle Specification certification if applies. (d) MDOT requires for procurements over $25,000.00 solicitations, including specifications and written selection procedures (lowest bids), Include Procurement Appendix A, F, G, H or I and Vehicle Specification certification if applies. Third Party Contracts with applicable clauses and bond documents must be included. Cause: The Authority did not follow its own procurement policy. Effect: The Authority is noncompliant with 2 CFR 200 and its own procurement policy. Directive: We direct the Authority review and update its procurement policy and implement procedures to ensure that the Authority is complying with the federal requirements, required forms are being completed, and documentation is being maintained. Management’s Response--Corrective Action Plan: Contact person is Rufus Adams, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority will review and update its procurement policy to comply with federal requirements. The Authority’s management, consultant, and finance director will review the procedures in the policy to ensure they are being acted upon accordingly going forward.
Failure to Follow Procurement Policy Finding 2023-003 Condition: The Authority did not comply with the current procurement policy as procedures were not fully followed and forms required by the Authority’s procurement policy were not completed. The following forms required by either 2 CFR 200 and/or the Authority’s own procurement policy were not completed for the current year capital asset purchases: Written Record of Procurement Checklist Form, Method of Procurement Decision Matrix, Advertisement and Solicitation Form, Bid Quotations, Fewer Than 3 Offers Received Evaluation if applicable, Proposal Tabulation, Certification of Compliance with Federal Clauses for the assets less than $25,000, and Responsibility Determination (sam.gov debarred verification). Also, as stated in the prior finding, the procurement policy needs to be updated. Criteria: According to 2 CFR 200.214 Suspension and Debarment, Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The following excerpts are from 2 CFR Part 200.318 General Procurement Standards. (a) The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in §§ 200.317 through 200.327. (i) the non-Federal entity 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. According to 2 CFR 200.320 Methods of Procurement to be Followed, 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. Concurrently, the Authority’s did not comply with its own current procurement policy as it did not follow or prepare the required documentation detailed in the following sections. Procurement Requests-The Authority will maintain sufficient records to detail the history of a procurement. Such records shall include method of procurement, selection of contract type, contractor selection (or rejection), and the contract price. The Authority will treat any prospective contractor or sub-contractor listed on a centralized State government debarment and suspension list as nonresponsible and ineligible for contract award. Debarment and Suspension- The Authority will treat any prospective contractor or sub-contractor listed on a centralized State government debarment and suspension list as non-responsible and ineligible for contract awards. To see if a prospective contractor is eligible, we will look on the website www.SAM.gov and when the bid has been received. Methods of Procurement- a. Micro and Emergency Purchases (do not exceed $10,000)-(a) A written determination as to why price is deemed fair and reasonable must be on file with each purchase made under this method of procurement using Micro-Purchase Price Reasonableness Determination Form. (b) Splitting of procurements to avoid the competitive procurement requirements of federal and state statues shall not be condoned. b. Small Purchase Procurement ($10,000 to $250,000)-(a) A minimum of two price or rate quotations shall be obtained from qualified sources; (b) The procurement will be made from the lowest priced qualified bid, if products or goods are equal; (c) MDOT requires for procurements under $25,000.00. Included Procurement Appendix A, B, E, F, G, H, or I and Vehicle Specification certification if applies. (d) MDOT requires for procurements over $25,000.00 solicitations, including specifications and written selection procedures (lowest bids), Include Procurement Appendix A, F, G, H or I and Vehicle Specification certification if applies. Third Party Contracts with applicable clauses and bond documents must be included. Cause: The Authority did not follow its own procurement policy. Effect: The Authority is noncompliant with 2 CFR 200 and its own procurement policy. Directive: We direct the Authority review and update its procurement policy and implement procedures to ensure that the Authority is complying with the federal requirements, required forms are being completed, and documentation is being maintained. Management’s Response--Corrective Action Plan: Contact person is Rufus Adams, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority will review and update its procurement policy to comply with federal requirements. The Authority’s management, consultant, and finance director will review the procedures in the policy to ensure they are being acted upon accordingly going forward.
Type of Finding: Material Weakness - Internal Control Criteria: Uniform Guidance states recipients of Coronavirus State and Local Fiscal Recovery Funds (CLFRF) are responsible for ensuring any procurement using CLFRF funds are consistent with the procurement standards set forth in the Uniform Guidance (2 CFR 200.214). Condition: The County failed to implement and monitor suspension and debarment procedures to comply with the Uniform Guidance (2 CFR 200.214). Cause: Procedures were not put in place to monitor the procurement procedures conducted by the independent contractor to assure compliance with the Uniform Guidance standards. Effect: Contracts may have been awarded to ineligible vendors. Questioned Costs: None Recommendation: Procedures should be put in place to monitor and comply with the Uniform Guidance procurement standards. Views of responsible officials and planned corrective action:
Type of Finding: Material Non-compliance Criteria: Uniform Guidance procurement standards (2 CFR 200.214) state recipients of Coronavirus State and Local Fiscal Recovery Funds are prohibited from entering into subawards and contracts with parties that are debarred, suspended or otherwise excluded from or ineligible for participation in Federal Assistance programs. Condition: The County failed to comply with the Uniform Guidance procurement standards (2 CFR 200.214) regarding suspension and debarment. Cause: The County's procurement procedures did not include procedures for vetting vendors with regard to suspension and debarment from participating in federal assistance programs. Effect: Contracts may have been awarded to vendors ineligible to participate in the federal assistance program. Questioned Cost: None Recommendation: Procedures should be put in place to comply with the Uniform Guidance procurement standards regarding suspension and debarment. Views of responsible officials and planned corrective action:
Criteria - According to the Coronavirus State and Local Recover Funds (CSLRF) Final Rule, Suspension and Debarment is covered under CFR 200.214 in Subpart C, which is fully applicable under the revenue replacement method. As such, suspension and debarment should be evaluated and documented for all non-payroll expenditures under the program. Condition - During our testing, it was noted that 6 of 6 of the vendor selections tested for this program did not have suspension and debarment evaluated or documented prior to the purchase. In addition, there was no formal control policy for the City to evaluate and document suspension and debarment for expenditures in this program. Cause - The City was unaware of this requirement applied to CSLRF funding under the revenue replacement method and, due to the timing of the previous audit, did not correct this issue for fiscal year 2023. Effect - By not evaluating suspension and debarment for the expenditures of this program, expenditures could be made that do not comply with the program requirements for suspension and debarment. Recommendation - We recommend that suspension and debarment be evaluated and documented for all expenditures made for this program and that a formal control policy for suspension and debarment be considered for such purchases.
Criteria: According to 2 CFR section 200.318(c) and 48 CFR sections 52.203-13 and 52.303-16, an entity should have written standards of conduct to cover conflicts of interest and govern the performance of its employees engaged in the selection, award, and administration of contracts. According to 2 CFR section 200.214, an entity is subject to the non-procurement debarment and suspension regulations. Condition: During our testing of federal award expenditures, it was noted that there were no formal written policies in place for standards of conducts covering conflict of interests for employees engaged in the selection, award, and administration of contracts nor to determine if a vendor is suspended or disbarred. Recommendation: The City should create policies and procedures for applicable requirements in order to comply with Federal regulations including procedures that cover conflicts of interest and govern the performance of its employees engaged in the selection, award, and administration of contracts and for procedures to determine whether vendors have been suspended or debarred prior to entering into contracts or purchase orders for all transactions and maintain documentation supporting this verification View of Responsible Officials and Planned Corrective Action: 1. Develop Comprehensive Policies and Procedures: Policy Development: Create policies that align with federal, state, and municipal regulations governing conflicts of interest and employee conduct in contract selection, award, and administration. Conflicts of Interest Policy: Define clear guidelines and procedures for identifying, disclosing, managing, and mitigating conflicts of interest among employees involved in contracting activities. Contract Administration Procedures: Establish detailed procedures that encompass the entire contract lifecycle, ensuring compliance with federal, state, and municipal requirements at every stage. Training and Awareness: Conduct training sessions for employees involved in contracting to ensure understanding and adherence to the newly developed policies, procedures and current bid law regulations set forth by the State of Alabama. 2. Implement Procedures for Vendor Evaluation and Debarment Checks: Vendor Evaluation Process: Develop standardized procedures for evaluating vendors before entering into contracts, including criteria for assessing qualifications, capabilities, and compliance with regulatory requirements. Debarment Check Procedure: Establish a systematic procedure to verify whether potential vendors have been suspended or debarred by federal, state, or municipal authorities prior to initiating contract negotiations. Documentation Requirements: Specify the documentation that must be collected and maintained to demonstrate compliance with vendor evaluation and debarment check procedures. 3. Maintain Comprehensive Documentation: Document Retention Policy: Create a policy outlining requirements for retaining all documentation related to contracts, including vendor evaluations, debarment checks, contract awards, modifications, and performance records. Centralized Documentation Management: Implement a centralized system or repository for storing and managing contract-related documentation, ensuring accessibility, security, and compliance with retention policies. Audit Trail: Maintain a clear audit trail for all contract-related activities, documenting decisionmaking processes and actions taken to ensure accountability and compliance. 4. Monitoring and Compliance Oversight: Monitoring Mechanisms: Establish mechanisms for ongoing monitoring of compliance with federal, state, and municipal regulations, as well as internal policies related to conflicts of interest, contract administration, and vendor debarment checks. Regular Audits: Conduct regular audits of contract management practices and documentation to identify any deviations from established procedures and regulatory requirements. Reporting and Accountability: Implement a reporting structure that provides regular updates to management and stakeholders on compliance status, audit findings, and corrective actions taken to address deficiencies. 5. Continuous Improvement and Adaptation: Feedback and Review: Encourage feedback from employees involved in contract management to identify opportunities for improving policies, procedures, and compliance practices. Benchmarking: Benchmark contract management practices against industry standards, best practices, and regulatory changes to continuously enhance processes and ensure alignment with evolving requirements. Adaptation to Changes: Stay informed about updates and changes in federal, state, and municipal regulations impacting conflicts of interest, contract administration, and vendor management, and update policies and procedures accordingly.
Finding No.: 2023-003 Federal Agency: U.S. Department of Treasury Federal Communications Commission AL Program: COVID-19 21.027 Coronavirus State and Local Fiscal Recovery Funds COVID-19 32.006 Telehealth Program Requirement: Suspension & Debarment Questioned Costs: $0 Criteria: In accordance with 2 CFR 200.214, non-Federal entities are subject to the non- procurement debarment and suspension regulations implementing 2 CFR 180. Such regulation restricts awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Under 2 CFR 180.300, when entering into a covered transaction with another person at the next lower tier, verification must be made that the person with whom an intent to do business with is not excluded or disqualified. Such verification can be made by (a) checking SAM Exclusions, (b) collecting a certification from that person; or (c) adding a clause or condition to the covered transaction with that person. Condition: The Authority did not properly document that verification was performed to identify if the selected person or entity in the covered transaction was not suspended or debarred prior to transacting with them. Cause: The Authority did not properly document that verification was performed to identify if the selected person or entity in the covered transaction was not suspended or debarred prior to transacting with them. Effect: The Authority is in noncompliance with the applicable requirement. Recommendation: The Authority should revisit and implement its procedures to ensure that vendors and entities that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities are restricted from Federal awards, subawards and contracts. Procedures performed should be adequately maintained in the procurement files. Views of Responsible Officials: GMHA's corrective action plan does not indicate disagreement and provides planned corrective actions.
Finding No.: 2023-003 Federal Agency: U.S. Department of Treasury Federal Communications Commission AL Program: COVID-19 21.027 Coronavirus State and Local Fiscal Recovery Funds COVID-19 32.006 Telehealth Program Requirement: Suspension & Debarment Questioned Costs: $0 Criteria: In accordance with 2 CFR 200.214, non-Federal entities are subject to the non- procurement debarment and suspension regulations implementing 2 CFR 180. Such regulation restricts awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Under 2 CFR 180.300, when entering into a covered transaction with another person at the next lower tier, verification must be made that the person with whom an intent to do business with is not excluded or disqualified. Such verification can be made by (a) checking SAM Exclusions, (b) collecting a certification from that person; or (c) adding a clause or condition to the covered transaction with that person. Condition: The Authority did not properly document that verification was performed to identify if the selected person or entity in the covered transaction was not suspended or debarred prior to transacting with them. Cause: The Authority did not properly document that verification was performed to identify if the selected person or entity in the covered transaction was not suspended or debarred prior to transacting with them. Effect: The Authority is in noncompliance with the applicable requirement. Recommendation: The Authority should revisit and implement its procedures to ensure that vendors and entities that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities are restricted from Federal awards, subawards and contracts. Procedures performed should be adequately maintained in the procurement files. Views of Responsible Officials: GMHA's corrective action plan does not indicate disagreement and provides planned corrective actions.
Finding 2023-004 – PROCUREMENT Type: Material Weakness in Internal Control/Noncompliance. Program: ALN 93.493 Congressional Directives Criteria: Pursuant to 2 CFR 200.320, when a procurement transaction under a Federal award exceeds the simplified acquisition threshold, formal procurement methods are required. Pursuant to 2 CFR 200.214 and 2 CFR part 180, prior to entering into a covered transaction, a nonfederal entity must verify that the person with whom they intend to do business is not suspended, debarred, or otherwise excluded or disqualified.” 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. Cause: This condition was caused by an insufficient internal control process for review and approval of procurements/check for suspension and debarment. Effect: The CMHSP purchased several items that did not have the proper documentation/support of the procurement process. Questioned Cost: $749,624 Context: Three contracts were paid from grant funds. The questioned costs shown above reflect the amount paid from grant funds for the year pursuant to those contracts. Also, upon subsequent review, it was determined that the vendor was not suspended, debarred, or otherwise excluded or disqualified. Recommendation: We recommend that the CMHSP review their internal controls and make necessary changes to ensure that purchases adhere to the CMHSP’s procurement policy. Management’s Resp: We are in agreement with this finding.
Program - AL 21.027 – COVID-19 – Coronavirus State and Local Fiscal Recovery Funds – Suspension & Debarment Grant Number & Year - SLFRP0847, March 3, 2021, through December 31, 2024 Federal Grantor Agency -U.S. Department of the Treasury Criteria -Title 2 of the U.S. Code of Federal Regulations (CFR) § 200.303 (January 1, 2023) states the following, in relevant part: The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award 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 § 200.214 (January 1, 2023) states the following: Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The U.S. Department of the Treasury adopted the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards in 2 CFR § 1000.10 (January 1, 2023), which states the following: Except for the deviations set forth elsewhere in this Part, the Department of the Treasury adopts the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, set forth at 2 CFR part 200. 2 CFR § 180.300 (January 1, 2023) requires non-Federal entities to verify that an entity is not excluded or disqualified prior to entering into a covered transaction by “(a) Checking SAM Exclusions; or (b) Collecting a certification from that . . . [entity]; or (c) Adding a clause or condition to the covered transaction with that . . . [entity].” A good internal control plan requires the County to have proper procedures in place to verify that contractors paid with Federal funds are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities. Condition -Dawson County could not provide documentation to support that the County implemented effective internal controls to ensure that suspension and debarment requirements were followed and adequately documented. We noted the County used Coronavirus State and Local Fiscal Recovery Funds to pay five vendors over $25,000 each, totaling $638,407, during the fiscal year ended June 30, 2023. The County failed to ensure that these vendors were not excluded or disqualified prior to entering into these covered transactions. We reviewed SAM.gov, and noted that none of these vendors were suspended, debarred, or otherwise excluded from participation in Federal programs or activities as of the date testing was performed. Repeat Finding - No Questioned Costs - None Statistical Sample - No Context - The following table provides details of the covered transactions noted: Cause - Lack of procedures and knowledge regarding suspension and debarment requirements. Effect - Without adequate procedures to ensure contractors are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities, there is an increased risk for the misuse of Federal funds and noncompliance with Federal regulations, leading to possible Federal sanctions. Recommendation - We recommend the County implement procedures to ensure, prior to entering into a covered transaction, that a contractor is not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities, and those procedures are adequately documented. View of Officials - The County has put procedures in place; when a contractor is hired, sam.gov will be utilized to verify the entity has not been suspended or debarred.
Program - AL 21.027 – COVID-19 – Coronavirus State and Local Fiscal Recovery Funds – Suspension & Debarment Grant Number & Year - SLFRP3090, March 3, 2021, through December 31, 2024 Federal Grantor Agency - U.S. Department of the Treasury Criteria - Title 2 of the U.S. Code of Federal Regulations (CFR) § 200.303 (January 1, 2023) states the following, in relevant part: The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award 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). The U.S. Department of the Treasury adopted the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards in 2 CFR § 1000.10 (January 1, 2023), which states the following: Except for the deviations set forth elsewhere in this Part, the Department of the Treasury adopts the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, set forth at 2 CFR part 200. 2 CFR § 200.214 (January 1, 2023) states the following: Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. 2 CFR § 180.300 (January 1, 2023) requires non-Federal entities to verify that an entity is not excluded or disqualified prior to entering into a covered transaction by: "(a) Checking SAM Exclusions; or (b) Collecting a certification from that . . . [entity]; or (c) Adding a clause or condition to the covered transaction with that . . . [entity]." A good internal control plan requires the County to have proper procedures in place to verify that contractors paid with Federal funds are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities. Condition - Knox County could not provide documentation to support that the County implemented effective internal controls to ensure that suspension and debarment requirements were followed and adequately documented. We noted the County used Coronavirus State and Local Fiscal Recovery Funds to pay three vendors over $25,000, totaling $633,021, during the fiscal year ended June 30, 2023. The County failed to ensure that these vendors were not excluded or disqualified prior to entering into these covered transactions. We reviewed SAM.gov, and noted that none of these vendors were suspended, debarred, or otherwise excluded from participation in Federal programs or activities as of the date testing was performed. Repeat Finding - No Questioned Costs - None Statistical Sample - No Context - The following table provides details of the covered transactions noted: Cause - Lack of procedures and knowledge regarding suspension and debarment requirements Effect - Without adequate procedures to ensure contractors are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities, there is an increased risk for the misuse of Federal funds and noncompliance with Federal regulations, leading to possible Federal sanctions. Recommendation - We recommend the County implement procedures to ensure, prior to entering into a covered transaction, that a contractor is not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities, and those procedures are adequately documented. View of Officials - The County has discussed checking the SAM (System for Award Management formerly Excluded Parties Listing System (EPLS), which is maintained by the General Services Administration to ensure vendors are not suspended or debarred before entering a transaction.
2023-002 - Procurment, Debarment & Suspension Certification Finding Criteria: 2 CFR Part 200.214 and 2 CFR Part 180 provides that entities who are suspended or debarred shall be excluded from financial and non-financial assistance and benefits under Federal Programs and activities. Accordingly, the District should follow their written policy/procedure for ensuring that vendors paid with federal funds are not suspected or debarred from doing business with the federal government. Condition: During our testing we found one instance where the Distrct had not checks SAMS.GOV, prior to making a purchase, to determine if the vendor was suspended or debarred from doing business with the District under a Federal Award. Cause and Effect: The District has a policy and process in place to check for suspension/debarment for all transactions except for purchases made with credit cards. However, the District checked afterwards, and this vendor was neither suspended or debarred. Repeat Finding: No Recommendation: We recommend that the District implements a process to scrutinize purchases with credit cards by verifying if a vendor is either suspended or debarred prior to commencing work under any contracts funded by the Federal Government.
Program - AL 21.027 – COVID-19 – Coronavirus State and Local Fiscal Recovery Funds Suspension & Debarment Grant Number & Year - SLFRP0874, March 3, 2021, through December 31, 2024 Federal Grantor Agency - U.S. Department of the Treasury Criteria - Title 2 of the U.S. Code of Federal Regulations (CFR) § 200.303 (January 1, 2023) states the following, in relevant part: The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award 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 § 200.214 (January 1, 2023) states the following: Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The U.S. Department of the Treasury adopted the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards in 2 CFR § 1000.10 (January 1, 2023), which states the following: Except for the deviations set forth elsewhere in this Part, the Department of the Treasury adopts the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, set forth at 2 CFR part 200. 2 CFR § 180.300 (January 1, 2023) requires non-Federal entities to verify that an entity is not excluded or disqualified prior to entering into a covered transaction by, “(a) Checking SAM Exclusions; or (b) Collecting a certification from that . . . [entity]; or (c) Adding a clause or condition to the covered transaction with that . . . [entity].” A good internal control plan requires the County to have proper procedures in place toverify that contractors paid with Federal funds are not suspended, debarred, or otherwiseexcluded from or ineligible for participation in Federal programs or activities. Condition - Dakota County could not provide documentation to support that the County implemented effective internal controls to ensure that suspension and debarment requirements were followed and adequately documented. We noted the County used Coronavirus State and Local Fiscal Recovery Funds to pay 14 vendors over $25,000 each, totaling $1,033,366, during the fiscal year ended June 30, 2023. The County failed to ensure that these vendors were not excluded or disqualified prior to entering into these covered transactions. We reviewed SAM.gov, and noted that none of these vendors were suspended, debarred, or otherwise excluded from participation in Federal programs or activities as of the date testing was performed. Repeat Finding - No Questioned Costs - None Statistical Sample - No Cause - Lack of procedures and knowledge regarding suspension and debarment requirements. Effect - Without adequate procedures to ensure contractors are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities, there is an increased risk for the misuse of Federal funds and noncompliance with Federal regulations, leading to possible Federal sanctions. Recommendation - We recommend the County implement procedures to ensure, prior to entering into a covered transaction, that a contractor is not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities, and those procedures are adequately documented. View of Officials - The County will implement procedures to ensure when a contractor is paid with federal funds, https://www.sam.gov will be utilized to verify the entity has not been suspended or debarred and such procedure will be adequately documented.
Program - AL 21.027 – COVID-19 – Coronavirus State and Local Fiscal Recovery Funds – Suspension & Debarment Grant Number & Year - SLFRP2377, March 3, 2021, through December 31, 2024 Federal Grantor Agency - U.S. Department of the Treasury Criteria - Title 2 of the U.S. Code of Federal Regulations (CFR) § 200.303 (January 1, 2023) states the following, in relevant part: The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award 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). The U.S. Department of the Treasury adopted the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards in 2 CFR § 1000.10 (January 1, 2023), which states the following: Except for the deviations set forth elsewhere in this Part, the Department of the Treasury adopts the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, set forth at 2 CFR part 200. 2 CFR § 200.214 (January 1, 2023) states the following: Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. 2 CFR § 180.300 (January 1, 2023) requires non-Federal entities to verify that an entity is not excluded or disqualified prior to entering into a covered transaction by: “(a) Checking SAM Exclusions; or (b) Collecting a certification from that . . . [entity]; or (c) Adding a clause or condition to the covered transaction with that . . . [entity].” A good internal control plan requires the County to have proper procedures in place to verify that contractors paid with Federal funds are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities. Condition - Holt County could not provide documentation to support that the County implemented effective internal controls to ensure that suspension and debarment requirements were followed and adequately documented. We noted the County used Coronavirus State and Local Fiscal Recovery Funds to pay six vendors over $25,000, totaling $1,146,781, during the fiscal year ended June 30, 2023. The County failed to ensure that these vendors were not excluded or disqualified prior to entering into these covered transactions. We reviewed SAM.gov, and noted that none of these vendors were suspended, debarred, or otherwise excluded from participation in Federal programs or activities as of the date testing was performed. Repeat Finding - No Questioned Costs - None Statistical Sample - No Context - The following table provides details of the covered transactions noted: Cause - Lack of procedures and knowledge regarding suspension and debarment requirements Effect - Without adequate procedures to ensure contractors are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities, there is an increased risk for the misuse of Federal funds and noncompliance with Federal regulations, leading to possible Federal sanctions. Recommendation - We recommend the County implement procedures to ensure, prior to entering into a covered transaction, that a contractor is not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities, and those procedures are adequately documented. View of Officials - Holt County’s first choice will be to obtain a certificate or an agreement with each entity stating they are in good standing.
Program - AL 21.027 – COVID-19 – Coronavirus State and Local Fiscal Recovery Funds – Suspension & Debarment Grant Number & Year - SLFRP3105, March 3, 2021, through December 31, 2024 Federal Grantor Agency - U.S. Department of the Treasury Criteria - Title 2 of the U.S. Code of Federal Regulations (CFR) § 200.303 (January 1, 2023) states the following, in relevant part: The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award 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).The U.S. Department of the Treasury adopted the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards in 2 CFR 1000.10 (January 1, 2023), which states the following: Except for the deviations set forth elsewhere in this Part, the Department of the Treasury adopts the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, set forth at 2 CFR part 200. 2 CFR § 200.214 (January 1, 2023) states the following: Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. 2 CFR § 180.300 (January 1, 2023) requires non-Federal entities to verify that an entity is not excluded or disqualified prior to entering into a covered transaction by: “(a) Checking SAM Exclusions; or (b) Collecting a certification from that . . . [entity]; or (c) Adding a clause or condition to the covered transaction with that . . . [entity].” A good internal control plan requires the County to have proper procedures in place to verify that contractors paid with Federal funds are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities. Condition - Antelope County could not provide documentation to support the County implemented effective internal controls to ensure that suspension and debarment requirements were followed and adequately documented. We noted the County used Coronavirus State and Local Fiscal Recovery Funds to pay one vendor over $25,000, totaling $1,204,000, during the fiscal year ended June 30, 2023. The County failed to ensure that this vendor, A&R Construction, was not excluded or disqualified prior to entering into this covered transaction. We reviewed SAM.gov, and noted this vendor was not suspended, debarred, or otherwise excluded from participation in Federal programs or activities as of the date testing was performed. Repeat Finding - No Questioned Costs - None Statistical Sample - No Cause - Lack of procedures and knowledge regarding suspension and debarment requirements Effect - Without adequate procedures to ensure contractors are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activies, there is an increased risk for the misuse of Federal funds and noncompliance with Federal regulations, leading to possible Federal sanctions. Recommendation - We recommend the County implement procedures to ensure, prior to entering into a covered transaction, that a contractor is not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities, and those procedures are adequately documented. View of Officials - It will be the practice of Antelope County to check vendor status with the SAMS/DUNS before any payments are made utilizing Federal funds. To further ensure the funds are safely being utilized and spent, regular checks on the vendor status will be completed.
2023-002 Noncompliance with Procurement, Suspension, & Debarment Standard – 21.027 (Significant Deficiency – Noncompliance) Criteria – 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, §200.214 prohibits non-federal entities from contracting with parties that are suspended or debarred under covered transactions. Condition and Context – Audit procedures revealed that there was not a process in place to formally document the review of the contracted entity for suspension and debarment prior to entering into the agreement. Cause – The Organization does not have a formal process to document suspension and debarment. Management was unaware of the requirement, though it was clear that management thoughtfully considered the contractor’s reputation and determined that the contractor was suited for the agreement. Effect –The Organization did not perform its review of suspension and debarment for this agreement, though the contractor was found to not be on prohibited lists at annual review. Questioned Costs – None Recommendations – Management should strengthen their processes, controls, and review over suspension, and debarment processes and ensure compliance with Uniform Administrative Requirements. Views of Responsible Officials and Planned Corrective Actions – Request constructions manager to check suspension and debarment of all subcontractors prior to hire if project has not already been started.
2023-002 Noncompliance with Procurement, Suspension, & Debarment Standard – 21.027 (Significant Deficiency – Noncompliance) Criteria – 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, §200.214 prohibits non-federal entities from contracting with parties that are suspended or debarred under covered transactions. Condition and Context – Audit procedures revealed that there was not a process in place to formally document the review of the contracted entity for suspension and debarment prior to entering into the agreement. Cause – The Organization does not have a formal process to document suspension and debarment. Management was unaware of the requirement, though it was clear that management thoughtfully considered the contractor’s reputation and determined that the contractor was suited for the agreement. Effect –The Organization did not perform its review of suspension and debarment for this agreement, though the contractor was found to not be on prohibited lists at annual review. Questioned Costs – None Recommendations – Management should strengthen their processes, controls, and review over suspension, and debarment processes and ensure compliance with Uniform Administrative Requirements. Views of Responsible Officials and Planned Corrective Actions – Request constructions manager to check suspension and debarment of all subcontractors prior to hire if project has not already been started.
2023-002 Noncompliance with Procurement, Suspension, & Debarment Standard – 21.027 (Significant Deficiency – Noncompliance) Criteria – 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, §200.214 prohibits non-federal entities from contracting with parties that are suspended or debarred under covered transactions. Condition and Context – Audit procedures revealed that there was not a process in place to formally document the review of the contracted entity for suspension and debarment prior to entering into the agreement. Cause – The Organization does not have a formal process to document suspension and debarment. Management was unaware of the requirement, though it was clear that management thoughtfully considered the contractor’s reputation and determined that the contractor was suited for the agreement. Effect –The Organization did not perform its review of suspension and debarment for this agreement, though the contractor was found to not be on prohibited lists at annual review. Questioned Costs – None Recommendations – Management should strengthen their processes, controls, and review over suspension, and debarment processes and ensure compliance with Uniform Administrative Requirements. Views of Responsible Officials and Planned Corrective Actions – Request constructions manager to check suspension and debarment of all subcontractors prior to hire if project has not already been started.
Program - AL #21.027 – COVID-19 Coronavirus State and Local Fiscal Recovery Funds – Suspension and Debarment Grant Number & Year - SLFRP2949, March 3, 2021, through December 31, 2024 Federal Grantor Agency - U.S. Department of the Treasury Criteria - Title 2 of the U.S. Code of Federal Regulations (CFR) § 200.303 (January 1, 2023) states the following, in relevant part: The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award 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 § 200.214 (January 1, 2023) states the following: Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The U.S. Department of the Treasury adopted the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards in 2 CFR § 1000.10 (January 1, 2023), which states the following: Except for the deviations set forth elsewhere in this Part, the Department of the Treasury adopts the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, set forth at 2 CFR part 200. 2 CFR § 180.300 (January 1, 2023) requires non-Federal entities to verify that an entity is not excluded or disqualified prior to entering into a covered transaction by “(a) Checking SAM Exclusions; or (b) Collecting a certification from that . . . [entity]; or (c) Adding a clause or condition to the covered transaction with that . . . [entity].” A good internal control plan requires the County to have proper procedures in place to verify that all contractors paid with Federal funds are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities. Condition - Lincoln County had controls in place to ensure that suspension and debarment requirements were followed and adequately documented; however, the County did not follow these controls for every vendor. We noted the County used Coronavirus State and Local Fiscal Recovery Funds to pay seven vendors over $25,000 each, totaling $5,540,320, during the fiscal year ended June 30, 2023. The County failed to ensure that these vendors, with whom the County regularly does business, were not excluded or disqualified prior to entering into these covered transactions. We reviewed SAM.gov, and noted that none of these vendors were suspended, debarred, or otherwise excluded from participation in Federal programs or activities as of the date testing was performed. Repeat Finding - No Questioned Costs - None Statistical Sample - No Context - The following table provides details of the covered transactions noted: Cause - Lack of procedures and knowledge regarding suspension and debarment requirements. Effect - Without adequate procedures to ensure all contractors are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities, there is an increased risk for the misuse of Federal funds and noncompliance with Federal regulations, leading to possible Federal sanctions. Recommendation - We recommend the County implement procedures to ensure, prior to entering into a covered transaction, that all contractors are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities, and those procedures are adequately documented. View of Officials - Lincoln County (submitting Department and County Clerk’s Office) will verify through Sam.Gov that all claims submitted for payment using federal funds are not suspended, debarred, or excluded from receiving federal dollars prior to payment of the claim.
Type of Finding Significant deficiency in internal control over financial reporting. Criteria or Specific Requirements 2 CFR Section 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition The District could not provide proof of verification of the suspension and debarment status of vendors before entering into services. Questioned Costs None. Context The District did not review 1 of 2 vendors tested in our sample to ensure they were not suspended or debarred when initiating covered transactions in the current year. Cause The District did not follow their Federal Funds Suspension and Debarment Policy related to appropriate methods of verifying vendors are not suspended or debarred. Effect The District could contract with a vendor that has been suspended or debarred from receiving federal funds. Repeat Finding No Recommendation We recommend the District include contract language which ensures vendor are not suspended or debarred as well as utilize sam.gov to review vendors at the beginning of the year or before a transaction is incurred in accordance with Uniform Guidance requirements. View of Reasonable Officials There is no disagreement with this finding and management has developed a plan to correct the finding.
Type of Finding Significant deficiency in internal control over financial reporting. Criteria or Specific Requirements 2 CFR Section 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition The District could not provide proof of verification of the suspension and debarment status of vendors before entering into services. Questioned Costs None. Context The District did not review 1 of 2 vendors tested in our sample to ensure they were not suspended or debarred when initiating covered transactions in the current year. Cause The District did not follow their Federal Funds Suspension and Debarment Policy related to appropriate methods of verifying vendors are not suspended or debarred. Effect The District could contract with a vendor that has been suspended or debarred from receiving federal funds. Repeat Finding No Recommendation We recommend the District include contract language which ensures vendor are not suspended or debarred as well as utilize sam.gov to review vendors at the beginning of the year or before a transaction is incurred in accordance with Uniform Guidance requirements. View of Reasonable Officials There is no disagreement with this finding and management has developed a plan to correct the finding.
Type of Finding Significant deficiency in internal control over financial reporting. Criteria or Specific Requirements 2 CFR Section 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition The District could not provide proof of verification of the suspension and debarment status of vendors before entering into services. Questioned Costs None. Context The District did not review 1 of 2 vendors tested in our sample to ensure they were not suspended or debarred when initiating covered transactions in the current year. Cause The District did not follow their Federal Funds Suspension and Debarment Policy related to appropriate methods of verifying vendors are not suspended or debarred. Effect The District could contract with a vendor that has been suspended or debarred from receiving federal funds. Repeat Finding No Recommendation We recommend the District include contract language which ensures vendor are not suspended or debarred as well as utilize sam.gov to review vendors at the beginning of the year or before a transaction is incurred in accordance with Uniform Guidance requirements. View of Reasonable Officials There is no disagreement with this finding and management has developed a plan to correct the finding.
Type of Finding Significant deficiency in internal control over financial reporting. Criteria or Specific Requirements 2 CFR Section 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition The District could not provide proof of verification of the suspension and debarment status of vendors before entering into services. Questioned Costs None. Context The District did not review 1 of 2 vendors tested in our sample to ensure they were not suspended or debarred when initiating covered transactions in the current year. Cause The District did not follow their Federal Funds Suspension and Debarment Policy related to appropriate methods of verifying vendors are not suspended or debarred. Effect The District could contract with a vendor that has been suspended or debarred from receiving federal funds. Repeat Finding No Recommendation We recommend the District include contract language which ensures vendor are not suspended or debarred as well as utilize sam.gov to review vendors at the beginning of the year or before a transaction is incurred in accordance with Uniform Guidance requirements. View of Reasonable Officials There is no disagreement with this finding and management has developed a plan to correct the finding.
Type of Finding Significant deficiency in internal control over financial reporting. Criteria or Specific Requirements 2 CFR Section 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition The District could not provide proof of verification of the suspension and debarment status of vendors before entering into services. Questioned Costs None. Context The District did not review 1 of 2 vendors tested in our sample to ensure they were not suspended or debarred when initiating covered transactions in the current year. Cause The District did not follow their Federal Funds Suspension and Debarment Policy related to appropriate methods of verifying vendors are not suspended or debarred. Effect The District could contract with a vendor that has been suspended or debarred from receiving federal funds. Repeat Finding No Recommendation We recommend the District include contract language which ensures vendor are not suspended or debarred as well as utilize sam.gov to review vendors at the beginning of the year or before a transaction is incurred in accordance with Uniform Guidance requirements. View of Reasonable Officials There is no disagreement with this finding and management has developed a plan to correct the finding.
Type of Finding Significant deficiency in internal control over financial reporting. Criteria or Specific Requirements 2 CFR Section 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition The District could not provide proof of verification of the suspension and debarment status of vendors before entering into services. Questioned Costs None. Context The District did not review 1 of 2 vendors tested in our sample to ensure they were not suspended or debarred when initiating covered transactions in the current year. Cause The District did not follow their Federal Funds Suspension and Debarment Policy related to appropriate methods of verifying vendors are not suspended or debarred. Effect The District could contract with a vendor that has been suspended or debarred from receiving federal funds. Repeat Finding No Recommendation We recommend the District include contract language which ensures vendor are not suspended or debarred as well as utilize sam.gov to review vendors at the beginning of the year or before a transaction is incurred in accordance with Uniform Guidance requirements. View of Reasonable Officials There is no disagreement with this finding and management has developed a plan to correct the finding.
Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster Assistance Listing Number: 84.027, 84.173 Federal Award Identification Number: N/A Pass-Through Agency: Massachusetts Department of Elementary and Secondary Education and the Massachusetts Department of Early Education and Care Pass-Through Number(s): 240-585359-2022-0131, 240-744100-2023-0131, 252-610784-2022-0131, 262-585362-2022-0131, 262-744101-2023-0131, 264-610783-2022-0131 Award Period: July 1, 2021 – June 30, 2023 Compliance Requirement: Procurement, Suspension and Debarment Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The Code of Federal Regulations (CFR) Title 2 Part 200.214 states that nonfederal entities are subject to the nonprocurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. These regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition and Context: Procedures were not in place to ensure three (3) of five (5) vendors selected for testing in our statistically valid sample and paid from the grant award were not suspended or debarred. Upon further testing, it was determined none of the vendors were suspended or debarred. Questioned costs: None Cause: Procedures were not in place to ensure vendors are not suspended or debarred. Effect: Federal funds could be expended to suspended or debarred vendors and subject to disallowance. Repeat Finding: No. Recommendation: We recommend the Town enhance procedures and controls to ensure verifications of suspension and debarment statuses are obtained from vendors prior to executing transactions with these vendors. Views of responsible officials: Management has updated procedures to ensure vendors are not suspended or debarred and has shared and reviewed this information with staff to ensure that the procedure is carefully followed.
Federal Agency: US Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553, 10.555, 10.559 Federal Award Identification Number and Year: Unknown Pass-Through Agency: Wisconsin Department of Public Instruction Pass-Through Number(s): 2023-714368-DPI-SB-SEVERE-546, 2023-715368-DPI-NSL-547, 2023-714368-SPI-SK_NSL-561, Unknown, 2023-714368-DPI-SFSP-586 Award Period: July 1, 2022 – June 30, 2023 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matter Criteria or Specific Requirement: 2 CFR Section 320.318(i) requires the District to 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 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: The District policy requires that they receive multiple price quotes for transactions over $10,000. The District policy also requires that for contracts, they include a suspension and debarment verification within said contract as well as look up the vendor’s status on sam.gov. The district did not retain documentation for multiple price quotes for 4 out of 5 small purchase transactions in our sample. The District also did not retain documentation related to suspension and debarment status for 2 out of 4 vendors in our sample. Questioned Costs: None Context: While the department heads are responsible for ensuring they maintain documentation over price quotes to comply with the districts small purchase policy, the District did not retain documentation over price quotes obtained nor documentation of how the vendor was ultimately selected for 4 out of 5 small purchase transactions in our sample. The District did not retain documentation over verification that the vendors status of suspension and debarment from sam.gov for 2 out of 4 vendors in our sample. Cause: The District employees did not retain the supporting documentation for information obtained from vendors. Also, due to turnover at the district with the superintendent, they are unable to locate the documentation for verification of suspension and debarment status. Effect: Procurement transactions may not be in compliance with the Uniform Guidance. District could contract with a vendor that has been suspended or debarred from receiving federal funds. Repeat Finding: No. Recommendation: We recommend that the District review its Uniform Guidance policies with all staff to ensure procurement requirements are understood and implement controls to help ensure compliance. We also recommend the District review and update policies and procedures over review of certain transactions to ensure that all federal grants with covered transactions have vendors reviewed for suspension and debarment status prior to entering into the transaction. View of Responsible Officials: There is no disagreement with the audit finding.
Federal Agency: US Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553, 10.555, 10.559 Federal Award Identification Number and Year: Unknown Pass-Through Agency: Wisconsin Department of Public Instruction Pass-Through Number(s): 2023-714368-DPI-SB-SEVERE-546, 2023-715368-DPI-NSL-547, 2023-714368-SPI-SK_NSL-561, Unknown, 2023-714368-DPI-SFSP-586 Award Period: July 1, 2022 – June 30, 2023 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matter Criteria or Specific Requirement: 2 CFR Section 320.318(i) requires the District to 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 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: The District policy requires that they receive multiple price quotes for transactions over $10,000. The District policy also requires that for contracts, they include a suspension and debarment verification within said contract as well as look up the vendor’s status on sam.gov. The district did not retain documentation for multiple price quotes for 4 out of 5 small purchase transactions in our sample. The District also did not retain documentation related to suspension and debarment status for 2 out of 4 vendors in our sample. Questioned Costs: None Context: While the department heads are responsible for ensuring they maintain documentation over price quotes to comply with the districts small purchase policy, the District did not retain documentation over price quotes obtained nor documentation of how the vendor was ultimately selected for 4 out of 5 small purchase transactions in our sample. The District did not retain documentation over verification that the vendors status of suspension and debarment from sam.gov for 2 out of 4 vendors in our sample. Cause: The District employees did not retain the supporting documentation for information obtained from vendors. Also, due to turnover at the district with the superintendent, they are unable to locate the documentation for verification of suspension and debarment status. Effect: Procurement transactions may not be in compliance with the Uniform Guidance. District could contract with a vendor that has been suspended or debarred from receiving federal funds. Repeat Finding: No. Recommendation: We recommend that the District review its Uniform Guidance policies with all staff to ensure procurement requirements are understood and implement controls to help ensure compliance. We also recommend the District review and update policies and procedures over review of certain transactions to ensure that all federal grants with covered transactions have vendors reviewed for suspension and debarment status prior to entering into the transaction. View of Responsible Officials: There is no disagreement with the audit finding.
Federal Agency: US Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553, 10.555, 10.559 Federal Award Identification Number and Year: Unknown Pass-Through Agency: Wisconsin Department of Public Instruction Pass-Through Number(s): 2023-714368-DPI-SB-SEVERE-546, 2023-715368-DPI-NSL-547, 2023-714368-SPI-SK_NSL-561, Unknown, 2023-714368-DPI-SFSP-586 Award Period: July 1, 2022 – June 30, 2023 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matter Criteria or Specific Requirement: 2 CFR Section 320.318(i) requires the District to 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 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: The District policy requires that they receive multiple price quotes for transactions over $10,000. The District policy also requires that for contracts, they include a suspension and debarment verification within said contract as well as look up the vendor’s status on sam.gov. The district did not retain documentation for multiple price quotes for 4 out of 5 small purchase transactions in our sample. The District also did not retain documentation related to suspension and debarment status for 2 out of 4 vendors in our sample. Questioned Costs: None Context: While the department heads are responsible for ensuring they maintain documentation over price quotes to comply with the districts small purchase policy, the District did not retain documentation over price quotes obtained nor documentation of how the vendor was ultimately selected for 4 out of 5 small purchase transactions in our sample. The District did not retain documentation over verification that the vendors status of suspension and debarment from sam.gov for 2 out of 4 vendors in our sample. Cause: The District employees did not retain the supporting documentation for information obtained from vendors. Also, due to turnover at the district with the superintendent, they are unable to locate the documentation for verification of suspension and debarment status. Effect: Procurement transactions may not be in compliance with the Uniform Guidance. District could contract with a vendor that has been suspended or debarred from receiving federal funds. Repeat Finding: No. Recommendation: We recommend that the District review its Uniform Guidance policies with all staff to ensure procurement requirements are understood and implement controls to help ensure compliance. We also recommend the District review and update policies and procedures over review of certain transactions to ensure that all federal grants with covered transactions have vendors reviewed for suspension and debarment status prior to entering into the transaction. View of Responsible Officials: There is no disagreement with the audit finding.
Federal Agency: US Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553, 10.555, 10.559 Federal Award Identification Number and Year: Unknown Pass-Through Agency: Wisconsin Department of Public Instruction Pass-Through Number(s): 2023-714368-DPI-SB-SEVERE-546, 2023-715368-DPI-NSL-547, 2023-714368-SPI-SK_NSL-561, Unknown, 2023-714368-DPI-SFSP-586 Award Period: July 1, 2022 – June 30, 2023 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matter Criteria or Specific Requirement: 2 CFR Section 320.318(i) requires the District to 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 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: The District policy requires that they receive multiple price quotes for transactions over $10,000. The District policy also requires that for contracts, they include a suspension and debarment verification within said contract as well as look up the vendor’s status on sam.gov. The district did not retain documentation for multiple price quotes for 4 out of 5 small purchase transactions in our sample. The District also did not retain documentation related to suspension and debarment status for 2 out of 4 vendors in our sample. Questioned Costs: None Context: While the department heads are responsible for ensuring they maintain documentation over price quotes to comply with the districts small purchase policy, the District did not retain documentation over price quotes obtained nor documentation of how the vendor was ultimately selected for 4 out of 5 small purchase transactions in our sample. The District did not retain documentation over verification that the vendors status of suspension and debarment from sam.gov for 2 out of 4 vendors in our sample. Cause: The District employees did not retain the supporting documentation for information obtained from vendors. Also, due to turnover at the district with the superintendent, they are unable to locate the documentation for verification of suspension and debarment status. Effect: Procurement transactions may not be in compliance with the Uniform Guidance. District could contract with a vendor that has been suspended or debarred from receiving federal funds. Repeat Finding: No. Recommendation: We recommend that the District review its Uniform Guidance policies with all staff to ensure procurement requirements are understood and implement controls to help ensure compliance. We also recommend the District review and update policies and procedures over review of certain transactions to ensure that all federal grants with covered transactions have vendors reviewed for suspension and debarment status prior to entering into the transaction. View of Responsible Officials: There is no disagreement with the audit finding.
Federal Agency: US Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553, 10.555, 10.559 Federal Award Identification Number and Year: Unknown Pass-Through Agency: Wisconsin Department of Public Instruction Pass-Through Number(s): 2023-714368-DPI-SB-SEVERE-546, 2023-715368-DPI-NSL-547, 2023-714368-SPI-SK_NSL-561, Unknown, 2023-714368-DPI-SFSP-586 Award Period: July 1, 2022 – June 30, 2023 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matter Criteria or Specific Requirement: 2 CFR Section 320.318(i) requires the District to 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 200.214 requires non-federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: The District policy requires that they receive multiple price quotes for transactions over $10,000. The District policy also requires that for contracts, they include a suspension and debarment verification within said contract as well as look up the vendor’s status on sam.gov. The district did not retain documentation for multiple price quotes for 4 out of 5 small purchase transactions in our sample. The District also did not retain documentation related to suspension and debarment status for 2 out of 4 vendors in our sample. Questioned Costs: None Context: While the department heads are responsible for ensuring they maintain documentation over price quotes to comply with the districts small purchase policy, the District did not retain documentation over price quotes obtained nor documentation of how the vendor was ultimately selected for 4 out of 5 small purchase transactions in our sample. The District did not retain documentation over verification that the vendors status of suspension and debarment from sam.gov for 2 out of 4 vendors in our sample. Cause: The District employees did not retain the supporting documentation for information obtained from vendors. Also, due to turnover at the district with the superintendent, they are unable to locate the documentation for verification of suspension and debarment status. Effect: Procurement transactions may not be in compliance with the Uniform Guidance. District could contract with a vendor that has been suspended or debarred from receiving federal funds. Repeat Finding: No. Recommendation: We recommend that the District review its Uniform Guidance policies with all staff to ensure procurement requirements are understood and implement controls to help ensure compliance. We also recommend the District review and update policies and procedures over review of certain transactions to ensure that all federal grants with covered transactions have vendors reviewed for suspension and debarment status prior to entering into the transaction. View of Responsible Officials: There is no disagreement with the audit finding.
Criteria: 2 CFR Section 320.318(i) requires the District to 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. CFR Section 200.214 requires nonfederal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition/Context: The District is part of a consortium composed of multiple school districts that designated one member district to handle procurement, suspension and debarment for all consortium members' food service programs. District policy requires District approval of the contracts after consortium finishes the proposal process and selects the prime vendors for the year. Cause: The District was not aware until mid-year that they needed to document controls ensuring District policy was followed and that it needed to maintain documentation regarding compliance when the consortium handled the process. Effect: Procurement contracts may not be in compliance with the Uniform Guidance. District could contract with a vendor that has been suspended or debarred from receiving federal funds. Recommendation: We recommend that the District review its Uniform Guidance policies with all staff to ensure procurement requirements are understood and implement controls to ensure compliance. We also recommend the District review and update policies and procedures over review of certain transactions to ensure that all federal grants with covered transactions have vendors reviewed for suspension and debarment status.
Criteria: 2 CFR Section 320.318(i) requires the District to 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. CFR Section 200.214 requires nonfederal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition/Context: The District is part of a consortium composed of multiple school districts that designated one member district to handle procurement, suspension and debarment for all consortium members' food service programs. District policy requires District approval of the contracts after consortium finishes the proposal process and selects the prime vendors for the year. Cause: The District was not aware until mid-year that they needed to document controls ensuring District policy was followed and that it needed to maintain documentation regarding compliance when the consortium handled the process. Effect: Procurement contracts may not be in compliance with the Uniform Guidance. District could contract with a vendor that has been suspended or debarred from receiving federal funds. Recommendation: We recommend that the District review its Uniform Guidance policies with all staff to ensure procurement requirements are understood and implement controls to ensure compliance. We also recommend the District review and update policies and procedures over review of certain transactions to ensure that all federal grants with covered transactions have vendors reviewed for suspension and debarment status.
Criteria: 2 CFR Section 320.318(i) requires the District to 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. CFR Section 200.214 requires nonfederal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a nonfederal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition/Context: The District is part of a consortium composed of multiple school districts that designated one member district to handle procurement, suspension and debarment for all consortium members' food service programs. District policy requires District approval of the contracts after consortium finishes the proposal process and selects the prime vendors for the year. Cause: The District was not aware until mid-year that they needed to document controls ensuring District policy was followed and that it needed to maintain documentation regarding compliance when the consortium handled the process. Effect: Procurement contracts may not be in compliance with the Uniform Guidance. District could contract with a vendor that has been suspended or debarred from receiving federal funds. Recommendation: We recommend that the District review its Uniform Guidance policies with all staff to ensure procurement requirements are understood and implement controls to ensure compliance. We also recommend the District review and update policies and procedures over review of certain transactions to ensure that all federal grants with covered transactions have vendors reviewed for suspension and debarment status.
U.S. Department of Education Passed-through the Commonwealth of Massachusetts’ Department of Elementary and Secondary Education Special Education Cluster (IDEA) – ALN 84.027 & 84.173 COVID-19 – Special Education Cluster (IDEA) – ALN 84.027X & 84.173X Significant Deficiency in Internal Controls Over Compliance Criteria: Per 2 CFR section 200.214, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Condition: Suspension and debarment compliance was not verified for two covered transactions. Cause: Lack of appropriate oversight resulted in required suspension and debarment checks not being performed. Effect: Grant transactions are not supported adequately, and the School is at risk of awarding contracts to vendors not eligible to participate in federal awards programs. It was determined that none of the three vendors were suspended or debarred from federal awards. Questioned Costs: None Repeat Finding from Prior Year: No. Recommendation: The School should implement procedures to document that all contractors under covered transactions that are performing services for the grant are not suspended or debarred.
U.S. Department of Education Passed-through the Commonwealth of Massachusetts’ Department of Elementary and Secondary Education Special Education Cluster (IDEA) – ALN 84.027 & 84.173 COVID-19 – Special Education Cluster (IDEA) – ALN 84.027X & 84.173X Significant Deficiency in Internal Controls Over Compliance Criteria: Per 2 CFR section 200.214, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Condition: Suspension and debarment compliance was not verified for two covered transactions. Cause: Lack of appropriate oversight resulted in required suspension and debarment checks not being performed. Effect: Grant transactions are not supported adequately, and the School is at risk of awarding contracts to vendors not eligible to participate in federal awards programs. It was determined that none of the three vendors were suspended or debarred from federal awards. Questioned Costs: None Repeat Finding from Prior Year: No. Recommendation: The School should implement procedures to document that all contractors under covered transactions that are performing services for the grant are not suspended or debarred.
U.S. Department of Education Passed-through the Commonwealth of Massachusetts’ Department of Elementary and Secondary Education Special Education Cluster (IDEA) – ALN 84.027 & 84.173 COVID-19 – Special Education Cluster (IDEA) – ALN 84.027X & 84.173X Significant Deficiency in Internal Controls Over Compliance Criteria: Per 2 CFR section 200.214, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Condition: Suspension and debarment compliance was not verified for two covered transactions. Cause: Lack of appropriate oversight resulted in required suspension and debarment checks not being performed. Effect: Grant transactions are not supported adequately, and the School is at risk of awarding contracts to vendors not eligible to participate in federal awards programs. It was determined that none of the three vendors were suspended or debarred from federal awards. Questioned Costs: None Repeat Finding from Prior Year: No. Recommendation: The School should implement procedures to document that all contractors under covered transactions that are performing services for the grant are not suspended or debarred.
U.S. Department of Education Passed-through the Commonwealth of Massachusetts’ Department of Elementary and Secondary Education Special Education Cluster (IDEA) – ALN 84.027 & 84.173 COVID-19 – Special Education Cluster (IDEA) – ALN 84.027X & 84.173X Significant Deficiency in Internal Controls Over Compliance Criteria: Per 2 CFR section 200.214, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Condition: Suspension and debarment compliance was not verified for two covered transactions. Cause: Lack of appropriate oversight resulted in required suspension and debarment checks not being performed. Effect: Grant transactions are not supported adequately, and the School is at risk of awarding contracts to vendors not eligible to participate in federal awards programs. It was determined that none of the three vendors were suspended or debarred from federal awards. Questioned Costs: None Repeat Finding from Prior Year: No. Recommendation: The School should implement procedures to document that all contractors under covered transactions that are performing services for the grant are not suspended or debarred.
U.S. Department of Education Passed-through the Commonwealth of Massachusetts’ Department of Elementary and Secondary Education Special Education Cluster (IDEA) – ALN 84.027 & 84.173 COVID-19 – Special Education Cluster (IDEA) – ALN 84.027X & 84.173X Significant Deficiency in Internal Controls Over Compliance Criteria: Per 2 CFR section 200.214, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Condition: Suspension and debarment compliance was not verified for two covered transactions. Cause: Lack of appropriate oversight resulted in required suspension and debarment checks not being performed. Effect: Grant transactions are not supported adequately, and the School is at risk of awarding contracts to vendors not eligible to participate in federal awards programs. It was determined that none of the three vendors were suspended or debarred from federal awards. Questioned Costs: None Repeat Finding from Prior Year: No. Recommendation: The School should implement procedures to document that all contractors under covered transactions that are performing services for the grant are not suspended or debarred.
U.S. Department of Education Passed-through the Commonwealth of Massachusetts’ Department of Elementary and Secondary Education Special Education Cluster (IDEA) – ALN 84.027 & 84.173 COVID-19 – Special Education Cluster (IDEA) – ALN 84.027X & 84.173X Significant Deficiency in Internal Controls Over Compliance Criteria: Per 2 CFR section 200.214, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Condition: Suspension and debarment compliance was not verified for two covered transactions. Cause: Lack of appropriate oversight resulted in required suspension and debarment checks not being performed. Effect: Grant transactions are not supported adequately, and the School is at risk of awarding contracts to vendors not eligible to participate in federal awards programs. It was determined that none of the three vendors were suspended or debarred from federal awards. Questioned Costs: None Repeat Finding from Prior Year: No. Recommendation: The School should implement procedures to document that all contractors under covered transactions that are performing services for the grant are not suspended or debarred.
The Christian County Fiscal Court Did Not Have Adequate Controls Over The Procurement, Suspension and Debarment Compliance Requirement On Federal Expenditures Federal Program: Assistance Listing #21.027 COVID-19 Coronavirus State and Local Fiscal Recovery Funds Award Number and Year: Information not available Name of Federal Agency and Pass-Thru Agency (if applicable): U.S. Department of Treasury Compliance Requirements: Procurement, Suspension & Debarment Type of Finding: Material Weakness Amount of Questioned Costs: $0 Opinion Modification (if applicable): No COVID Related: Yes The Christian County Fiscal Court failed to implement adequate controls over Procurement, Suspension and Debarment compliance requirements of the Coronavirus State and Local Fiscal Recovery Funds (SLFRF). The disbursement of the SLFRF monies was not handled in the manner prescribed by the county’s administrative code. Three disbursements totaling $1,378,654 were tested and purchase orders were not utilized for any of the three disbursements. The fiscal court also failed to document adequate controls concerning the compliance with suspension and debarment requirements. There was no documentation that suspension and debarment compliance requirements were followed. The county’s contracts with local utilities failed to include suspension and debarment requirements. Additionally, there was no documentation that a search for suspended or debarred parties was performed prior to disbursing the funds to the utilities. The county treasurer was not aware purchase orders were not issued. Preprinted purchase orders for the ARPA (SLFRF) Fund were not available for use. There was a breakdown in the verification process of debarred or suspended parties. Since the fiscal court did not issue purchase orders for the disbursements from the SLFRF monies, amounts spent could have exceeded budgetary restrictions, rendering them void. Additionally, because there was no documented search for suspended or debarred parties, ineligible vendors or contractors could have been utilized putting the county at risk for being held responsible for unallowed or questioned costs. 2 CFR 200.318(a) states “The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward.” The Christian County Administrative Code section 4.5 states for claims against Christian County “Each claim shall be recorded by date, receipts, and purchase order number and presented to the Fiscal Court at its next meeting.” Additionally, the Department of Local Government (DLG) requires counties to implement a purchase order system which includes issuing purchase orders for all claims expended from the county’s budget. Good internal controls require the use of established procurement policies to ensure that federal disbursements are handled in the manner consistent with the treatment of non-federal disbursements. 2 CFR 200.214 states “Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.” Good internal controls dictate documentation be maintained that verifies debarment and suspension regulations have been communicated and followed for vendors or contractors used in federally funded projects. We recommend that the county improve internal controls over federal expenditures to ensure all compliance requirements are followed. This is not a repeat finding from the previous year.
Assistance Listing Number, Federal Agency, and Program Name - 21.027, U.S. Department of the Treasury, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Federal Award Identification Number and Year - Not applicable Pass-through Entity - Not applicable Finding Type - Material weakness and material noncompliance with laws and regulations Repeat Finding - No Criteria - 2 CFR 200.214 requires non-federal entities to comply with regulations related to suspension and debarment. Condition - The City had no control procedures in place for ensuring contractors performing work on federal projects were not suspended or debarred. Questioned Costs - None. Although there was no verification that the contractor was not suspended or debarred prior to the audit, a subsequent check was performed to verify the vendor was not suspended or debarred. Identification of How Questioned Costs Were Computed - Not applicable Context - The City utilized one contractor for the civic center improvement project paid with Coronavirus State and Local Fiscal Recovery Funds. Cause and Effect - Without controls in place to ensure vendors are not suspended or debarred, the City risks entering into contracts with excluded parties, which would be considered noncompliance with the Uniform Guidance. Recommendation - We recommend the City update its policies to include controls for verifying contractors are not suspended or debarred. Although this is a requirement only for contracts involving the use of federal funds, the City may want to update its policies over all procurements, not just those related to federally funded projects. Views of Responsible Officials and Corrective Action Plan - City manager office staff has searched the state procurement office webpage to check if any vendor for a federal project is on the debarment list, which they are not. In the future, as part of Federal Grant Funding implementation, staff will check vendors to make sure they are not debarred or suspended from federal funding awards.
Assistance Listing Number, Federal Agency, and Program Name - 21.027, U.S. Department of the Treasury, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Federal Award Identification Number and Year - Not applicable Pass-through Entity - Not applicable Finding Type - Material weakness and material noncompliance with laws and regulations Repeat Finding - No Criteria - 2 CFR 200.214 requires non-federal entities to comply with regulations related to suspension and debarment. Condition - The City had no control procedures in place for ensuring contractors performing work on federal projects were not suspended or debarred. Questioned Costs - None. Although there was no verification that the contractor was not suspended or debarred prior to the audit, a subsequent check was performed to verify the vendor was not suspended or debarred. Identification of How Questioned Costs Were Computed - Not applicable Context - The City utilized one contractor for the civic center improvement project paid with Coronavirus State and Local Fiscal Recovery Funds. Cause and Effect - Without controls in place to ensure vendors are not suspended or debarred, the City risks entering into contracts with excluded parties, which would be considered noncompliance with the Uniform Guidance. Recommendation - We recommend the City update its policies to include controls for verifying contractors are not suspended or debarred. Although this is a requirement only for contracts involving the use of federal funds, the City may want to update its policies over all procurements, not just those related to federally funded projects. Views of Responsible Officials and Corrective Action Plan - City manager office staff has searched the state procurement office webpage to check if any vendor for a federal project is on the debarment list, which they are not. In the future, as part of Federal Grant Funding implementation, staff will check vendors to make sure they are not debarred or suspended from federal funding awards.