Failure to Follow Procurement Policy Finding 2024-002 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 for the heating ventilation and cooling project, new roof, and electric vehicle charging stations. 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). Criteria: The following requirements are documented in 2 CFR 200-Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 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. 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. 2 CFR 200.320 Methods of Procurement to be Followed (b) 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. 2 CFR 200.324 Contract Cost and Price (a) The Non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. 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 Todd Shurn, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority acknowledges the finding and is currently working to correct this.
Failure to Follow Procurement Policy Finding 2024-002 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 for the heating ventilation and cooling project, new roof, and electric vehicle charging stations. 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). Criteria: The following requirements are documented in 2 CFR 200-Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 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. 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. 2 CFR 200.320 Methods of Procurement to be Followed (b) 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. 2 CFR 200.324 Contract Cost and Price (a) The Non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. 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 Todd Shurn, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority acknowledges the finding and is currently working to correct this.
Failure to Follow Procurement Policy Finding 2024-002 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 for the heating ventilation and cooling project, new roof, and electric vehicle charging stations. 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). Criteria: The following requirements are documented in 2 CFR 200-Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 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. 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. 2 CFR 200.320 Methods of Procurement to be Followed (b) 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. 2 CFR 200.324 Contract Cost and Price (a) The Non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. 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 Todd Shurn, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority acknowledges the finding and is currently working to correct this.
Failure to Follow Procurement Policy Finding 2024-002 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 for the heating ventilation and cooling project, new roof, and electric vehicle charging stations. 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). Criteria: The following requirements are documented in 2 CFR 200-Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 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. 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. 2 CFR 200.320 Methods of Procurement to be Followed (b) 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. 2 CFR 200.324 Contract Cost and Price (a) The Non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. 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 Todd Shurn, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority acknowledges the finding and is currently working to correct this.
Failure to Follow Procurement Policy Finding 2024-002 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 for the heating ventilation and cooling project, new roof, and electric vehicle charging stations. 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). Criteria: The following requirements are documented in 2 CFR 200-Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 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. 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. 2 CFR 200.320 Methods of Procurement to be Followed (b) 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. 2 CFR 200.324 Contract Cost and Price (a) The Non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. 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 Todd Shurn, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority acknowledges the finding and is currently working to correct this.
Failure to Follow Procurement Policy Finding 2024-002 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 for the heating ventilation and cooling project, new roof, and electric vehicle charging stations. 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). Criteria: The following requirements are documented in 2 CFR 200-Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 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. 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. 2 CFR 200.320 Methods of Procurement to be Followed (b) 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. 2 CFR 200.324 Contract Cost and Price (a) The Non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. 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 Todd Shurn, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority acknowledges the finding and is currently working to correct this.
Failure to Follow Procurement Policy Finding 2024-002 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 for the heating ventilation and cooling project, new roof, and electric vehicle charging stations. 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). Criteria: The following requirements are documented in 2 CFR 200-Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 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. 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. 2 CFR 200.320 Methods of Procurement to be Followed (b) 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. 2 CFR 200.324 Contract Cost and Price (a) The Non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. 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 Todd Shurn, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority acknowledges the finding and is currently working to correct this.
2024-001 Type of Finding: Material Weakness in Internal Control over Compliance and Material Noncompliance Federal Program Information Funding Agency: U.S. Department of the Treasury Federal ALN: 21.027 Criteria Per 2 CFR 200.214, non-federal entities are prohibited from contracting with parties that are suspended or debarred. 2 CFR 200.318(i) also states that "subrecipients must maintain records sufficient to detail the history of each procurement transaction. These records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price." Condition The Chamber has a procurement policy in place; however, the Chamber neglected to verify if vendors had been suspended or debarred, in accordance with stated regulations. The Chamber also did not maintain sufficient records to document the rationale for the procurement method used for a transaction exceeding the small purchase threshold. Questioned Costs $25,000 Context A sample of 3 vendors was made from a population of 3 vendors whose expenses exceeded the covered transaction threshold that were charged to the major program. Of the 3 sampled vendors, the Chamber neglected to check the suspension or debarment status of 1 vendor prior to entering a covered transaction of $25,000. A sample of 3 vendors was made from a population of 3 vendors whose total transactions exceeded the small purchase threshold. Of the 3 sampled vendors, the Chamber did not maintain sufficient records to document the rationale of using a noncompetitive procurement method for a small purchase transaction. Cause The Chamber claimed that they had been conducting business transactions with this vendor prior to having a procurement policy in place and did not implement the procurement policy on already developed business relationships. The Chamber also did not consider documenting its rationale for continuing to use the vendor for services that exceeded the small purchase threshold that were charged to the major program. Effect Purchases may have occurred that do not follow the policy, and contracts with vendors that had been suspended or debarred could have been awarded and not detected. The Chamber also did not conduct procurement transaction "in a manner that provides full and open competition," as defined in 2 CFR 200.319(a). Repeat Finding Yes - reference 2023-001. Auditor's Recommendations Tacoma-Pierce County Chamber of Commerce should include a provision in all contracts transacted in conjunction with using funds originating from a federal award grant, with respect to suspension and debarment, communicate all requirements for procurement to staff and establish procedures to verify that vendors are not suspended or debarred. Chamber staff should also perform an independent status check of vendors in sam.gov prior to entering into an agreement and retain the search results. The Chamber should also evaluate its current method of procurement and educate staff that if using funds from a federal award to enter into a transaction exceeding the small purchase threshold, that full and open competition must be facilitated, despite any prior relationships with vendors.
Finding Number: 2024-010 Prior Year Finding Number: N/A Compliance Requirement: Procurement and Suspension and Debarment Program: U.S. Department of the Treasury COVID-19 – Coronavirus Capital Projects Fund ALN: 21.029 Award #: CPFFN0167 Award Year: 02/09/2022 – 12/31/2026 Government Department/Agency: District of Columbia Public Library (DCPL) Criteria - The Uniform Guidance in 2 CFR Section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. In accordance with 2 CFR Section 200.318(a), General Procurement Standards, the non-federal entity must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations, provided that the procurements conform to applicable federal law and the standards identified in General Procurement Standards. Additionally, 2 CFR Section 200.318(i) states that the non-federal entity must maintain records sufficient to detail the history of the procurement. These records are required to 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. All procurement transactions must be conducted in a manner providing full and open competition consistent in accordance with 2 CFR Section 200.319 and must be performed using the appropriate procurement method as outlined in 2 CFR Section 200.320. In accordance with 2 CFR Section 200.320(c), Noncompetitive procurement. There are specific circumstances in which the recipient or subrecipient may use a noncompetitive procurement method. The noncompetitive procurement method may only be used if one of the following circumstances applies: (1) The aggregate amount of the procurement transaction does not exceed the micro-purchase threshold (see paragraph (a)(1) of this section); (2) The procurement transaction can only be fulfilled by a single source; (3) The public exigency or emergency for the requirement will not permit a delay resulting from providing public notice of a competitive solicitation; (4) The recipient or subrecipient requests in writing to use a noncompetitive procurement method, and the Federal agency or pass-through entity provides written approval; or (5) After soliciting several sources, competition is determined inadequate. Condition – During our testing of procurement and suspension and debarment requirements, we examined the two (2) procurement contracts that comprised the entire procurement population. Based on the procedures performed, we identified one (1) contract, valued at $278,259, out of the two (2) contracts totaling $8,185,708, in which DCPL used a single source or sole source justification for the selection rationale. However, this justification did not comply with the requirements set forth in 2 CFR Section 200.320(c). Questioned Costs – Not determinable. Context – This is a condition identified per review of DCPL’s compliance with the specified requirements using a statistically valid sample. Effect – Failure to adhere to the procurement procedures specified in the Uniform Administrative Requirements may lead to the Federal agency disallowing the procurement and associated costs. Cause – While DCPL adhered to their policies and procedures for private expenditures, the agency did not adhere to federal procurement requirements (2 CFR Section 200.320(c)) listed above to support noncompetitive procurement on the requirements to use sole source. Recommendation – We recommend that management establish the requisite internal control policies and procedures to ensure that all procurements reported under the federal program are in compliance. Related Noncompliance – Noncompliance. Views of Responsible Officials and Planned Corrective Actions – DCPL concurs with the auditor’s findings and recommendations. The District’s corrective action is described in the Management’s Corrective Action Plan included as Appendix B of the attached Management’s Section.
Failure to Follow Procurement Policy Finding 2024-002 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 for the heating ventilation and cooling project, new roof, and electric vehicle charging stations. 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). Criteria: The following requirements are documented in 2 CFR 200-Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 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. 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. 2 CFR 200.320 Methods of Procurement to be Followed (b) 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. 2 CFR 200.324 Contract Cost and Price (a) The Non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. 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 Todd Shurn, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority acknowledges the finding and is currently working to correct this.
Failure to Follow Procurement Policy Finding 2024-002 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 for the heating ventilation and cooling project, new roof, and electric vehicle charging stations. 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). Criteria: The following requirements are documented in 2 CFR 200-Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 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. 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. 2 CFR 200.320 Methods of Procurement to be Followed (b) 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. 2 CFR 200.324 Contract Cost and Price (a) The Non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. 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 Todd Shurn, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority acknowledges the finding and is currently working to correct this.
Failure to Follow Procurement Policy Finding 2024-002 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 for the heating ventilation and cooling project, new roof, and electric vehicle charging stations. 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). Criteria: The following requirements are documented in 2 CFR 200-Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 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. 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. 2 CFR 200.320 Methods of Procurement to be Followed (b) 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. 2 CFR 200.324 Contract Cost and Price (a) The Non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. 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 Todd Shurn, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority acknowledges the finding and is currently working to correct this.
Failure to Follow Procurement Policy Finding 2024-002 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 for the heating ventilation and cooling project, new roof, and electric vehicle charging stations. 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). Criteria: The following requirements are documented in 2 CFR 200-Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 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. 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. 2 CFR 200.320 Methods of Procurement to be Followed (b) 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. 2 CFR 200.324 Contract Cost and Price (a) The Non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. 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 Todd Shurn, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority acknowledges the finding and is currently working to correct this.
Failure to Follow Procurement Policy Finding 2024-002 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 for the heating ventilation and cooling project, new roof, and electric vehicle charging stations. 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). Criteria: The following requirements are documented in 2 CFR 200-Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 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. 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. 2 CFR 200.320 Methods of Procurement to be Followed (b) 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. 2 CFR 200.324 Contract Cost and Price (a) The Non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. 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 Todd Shurn, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority acknowledges the finding and is currently working to correct this.
Failure to Follow Procurement Policy Finding 2024-002 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 for the heating ventilation and cooling project, new roof, and electric vehicle charging stations. 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). Criteria: The following requirements are documented in 2 CFR 200-Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 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. 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. 2 CFR 200.320 Methods of Procurement to be Followed (b) 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. 2 CFR 200.324 Contract Cost and Price (a) The Non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. 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 Todd Shurn, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority acknowledges the finding and is currently working to correct this.
Failure to Follow Procurement Policy Finding 2024-002 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 for the heating ventilation and cooling project, new roof, and electric vehicle charging stations. 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). Criteria: The following requirements are documented in 2 CFR 200-Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 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. 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. 2 CFR 200.320 Methods of Procurement to be Followed (b) 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. 2 CFR 200.324 Contract Cost and Price (a) The Non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. 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 Todd Shurn, Executive Director, 275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. The Authority acknowledges the finding and is currently working to correct this.
2024-001 Type of Finding: Material Weakness in Internal Control over Compliance and Material Noncompliance Federal Program Information Funding Agency: U.S. Department of the Treasury Federal ALN: 21.027 Criteria Per 2 CFR 200.214, non-federal entities are prohibited from contracting with parties that are suspended or debarred. 2 CFR 200.318(i) also states that "subrecipients must maintain records sufficient to detail the history of each procurement transaction. These records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price." Condition The Chamber has a procurement policy in place; however, the Chamber neglected to verify if vendors had been suspended or debarred, in accordance with stated regulations. The Chamber also did not maintain sufficient records to document the rationale for the procurement method used for a transaction exceeding the small purchase threshold. Questioned Costs $25,000 Context A sample of 3 vendors was made from a population of 3 vendors whose expenses exceeded the covered transaction threshold that were charged to the major program. Of the 3 sampled vendors, the Chamber neglected to check the suspension or debarment status of 1 vendor prior to entering a covered transaction of $25,000. A sample of 3 vendors was made from a population of 3 vendors whose total transactions exceeded the small purchase threshold. Of the 3 sampled vendors, the Chamber did not maintain sufficient records to document the rationale of using a noncompetitive procurement method for a small purchase transaction. Cause The Chamber claimed that they had been conducting business transactions with this vendor prior to having a procurement policy in place and did not implement the procurement policy on already developed business relationships. The Chamber also did not consider documenting its rationale for continuing to use the vendor for services that exceeded the small purchase threshold that were charged to the major program. Effect Purchases may have occurred that do not follow the policy, and contracts with vendors that had been suspended or debarred could have been awarded and not detected. The Chamber also did not conduct procurement transaction "in a manner that provides full and open competition," as defined in 2 CFR 200.319(a). Repeat Finding Yes - reference 2023-001. Auditor's Recommendations Tacoma-Pierce County Chamber of Commerce should include a provision in all contracts transacted in conjunction with using funds originating from a federal award grant, with respect to suspension and debarment, communicate all requirements for procurement to staff and establish procedures to verify that vendors are not suspended or debarred. Chamber staff should also perform an independent status check of vendors in sam.gov prior to entering into an agreement and retain the search results. The Chamber should also evaluate its current method of procurement and educate staff that if using funds from a federal award to enter into a transaction exceeding the small purchase threshold, that full and open competition must be facilitated, despite any prior relationships with vendors.
Finding Number: 2024-010 Prior Year Finding Number: N/A Compliance Requirement: Procurement and Suspension and Debarment Program: U.S. Department of the Treasury COVID-19 – Coronavirus Capital Projects Fund ALN: 21.029 Award #: CPFFN0167 Award Year: 02/09/2022 – 12/31/2026 Government Department/Agency: District of Columbia Public Library (DCPL) Criteria - The Uniform Guidance in 2 CFR Section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. In accordance with 2 CFR Section 200.318(a), General Procurement Standards, the non-federal entity must use its own documented procurement procedures which reflect applicable State, local, and tribal laws and regulations, provided that the procurements conform to applicable federal law and the standards identified in General Procurement Standards. Additionally, 2 CFR Section 200.318(i) states that the non-federal entity must maintain records sufficient to detail the history of the procurement. These records are required to 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. All procurement transactions must be conducted in a manner providing full and open competition consistent in accordance with 2 CFR Section 200.319 and must be performed using the appropriate procurement method as outlined in 2 CFR Section 200.320. In accordance with 2 CFR Section 200.320(c), Noncompetitive procurement. There are specific circumstances in which the recipient or subrecipient may use a noncompetitive procurement method. The noncompetitive procurement method may only be used if one of the following circumstances applies: (1) The aggregate amount of the procurement transaction does not exceed the micro-purchase threshold (see paragraph (a)(1) of this section); (2) The procurement transaction can only be fulfilled by a single source; (3) The public exigency or emergency for the requirement will not permit a delay resulting from providing public notice of a competitive solicitation; (4) The recipient or subrecipient requests in writing to use a noncompetitive procurement method, and the Federal agency or pass-through entity provides written approval; or (5) After soliciting several sources, competition is determined inadequate. Condition – During our testing of procurement and suspension and debarment requirements, we examined the two (2) procurement contracts that comprised the entire procurement population. Based on the procedures performed, we identified one (1) contract, valued at $278,259, out of the two (2) contracts totaling $8,185,708, in which DCPL used a single source or sole source justification for the selection rationale. However, this justification did not comply with the requirements set forth in 2 CFR Section 200.320(c). Questioned Costs – Not determinable. Context – This is a condition identified per review of DCPL’s compliance with the specified requirements using a statistically valid sample. Effect – Failure to adhere to the procurement procedures specified in the Uniform Administrative Requirements may lead to the Federal agency disallowing the procurement and associated costs. Cause – While DCPL adhered to their policies and procedures for private expenditures, the agency did not adhere to federal procurement requirements (2 CFR Section 200.320(c)) listed above to support noncompetitive procurement on the requirements to use sole source. Recommendation – We recommend that management establish the requisite internal control policies and procedures to ensure that all procurements reported under the federal program are in compliance. Related Noncompliance – Noncompliance. Views of Responsible Officials and Planned Corrective Actions – DCPL concurs with the auditor’s findings and recommendations. The District’s corrective action is described in the Management’s Corrective Action Plan included as Appendix B of the attached Management’s Section.
Finding No.: 2024-009 Federal Agency: U.S. Department of Education AL Program: 84.403 Consolidated Grant to the Outlying Area Area: Procurement and Suspension and Debarment Questioned Costs: $6,918 Criteria: 2 CFR 200.319 states that: (a) All procurement transactions under the Federal award must be conducted in a manner that provides full and open competition and is consistent with the standards of this section and 2 CFR 200.320. (c) (6) Examples of situations that may restrict competition include specifying only a “brand name” product instead of allowing “an equal” product to be offered and describing the performance or other relevant requirements of the procurement. (d) (2) The recipient or subrecipient must have written procedures for procurement transactions. These procedures must ensure that all solicitations incorporate a clear and accurate description of the technical requirements for the property, equipment, or service being procured. The description may include a statement of the qualitative nature of the property, equipment, or service to be procured. When necessary, the description must provide minimum essential characteristics and standards to which the property, equipment, or service must conform. Detailed product specifications should be avoided if at all possible. When it is impractical or uneconomical to clearly and accurately describe the technical requirements, a “brand name or equivalent” description of features may be used to provide procurement requirements. The specific features of the named brand must be clearly stated. 2 CFR 200.324(a) states that recipient or subrecipient must perform a cost or price analysis for every procurement transaction, including contract modifications, in excess of the simplified acquisition threshold. Finding No.: 2024-009, continued Federal Agency: U.S. Department of Education AL Program: 84.403 Consolidated Grant to the Outlying Area Area: Procurement and Suspension and Debarment Questioned Costs: $6,918 Conditions: 1. Of thirty-nine items, aggregating $426,960 of $9,005,697 of expenditures subjected to procurement test, deficiencies were noted, as follows: a. For 1 item (or 3%), procurement did not provide full and open competition in the solicitation process. The request for quotation specified particular model, including a requirement for a specific “brand name” product instead of allowing “an equal” product to be offered. Item # Federal Award No. Purchase Order Expenditures Questioned Costs 1 S403A220002 20240435 $12,447 $6,918 2. GDOE does not have procurement policies that meet the requirements of 2 CFR 200.318(a) and 2 CFR 200.324(a). Specifically, GDOE lacks documented procedures to ensure compliance with procurement transactions under a Federal award or subaward, requiring the performance and retention of cost price analysis for procurement transactions above the simplified acquisition threshold. Cause: GDOE did not enforce monitoring controls over compliance with applicable procurement requirements. Also, GDOE lacks adequate internal controls over periodic review of procurement policies, specifically, ensuring all required key provisions from the Compliance Supplement are included in the procurement policies. Effect: GDOE is in noncompliance with applicable procurement and suspension and debarment requirements. The reportable questioned cost is $6,918. Also, we did not identify procurement of goods or services that would have required a cost price analysis. Finding No.: 2024-009, continued Federal Agency: U.S. Department of Education AL Program: 84.403 Consolidated Grant to the Outlying Area Area: Procurement and Suspension and Debarment Questioned Costs: $6,918 Recommendation: Responsible personnel should enforce monitoring controls over compliance with applicable procurement requirements. Also, GDOE should revisit its procurement policies and ensure all required provisions stated in the Compliance Supplement are covered.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.
Repeat finding 2023-001, 2022-001, and 2021-002 FAN 93.676 Unaccompanied Alien Children Program Child Nutrition Cluster Procurement and Suspension & Debarment Type of Finding: Non-Compliance U.S. Department of Health & Human Services U.S Department of Agriculture Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. A non-federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors’ performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) (1) and (2). 4. For acquisitions exceeding the simplified acquisition threshold, the non-federal entity must use one of the following procurement methods: the sealed bid method if the acquisition meets the criteria in 2 CFR section 200.320(b); the competitive proposals method under the conditions specified in 2 CFR section 200.320((b) (2); or the noncompetitive proposals method (i.e., solicit a proposal from only one source) but only when one or more of four circumstances are met, in accordance with 2 CFR section 200.320(c)). 5. Perform a cost or price analysis in connection with every procurement action in excess of the simplified acquisition threshold, including contract modifications (2 CFR section 200.323(a)). The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used (2 CFR section 200.323(b)). 6. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR Part 200, “Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.” The requirements that apply to procurement under grants and cooperative agreements are contained in 2 CFR sections 200.317 through 200.326, program legislation, federal awarding agency regulations, and the terms and conditions of the award. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. The requirements for non-procurement suspension and debarment are contained in OMB guidance in 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension;” federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. Condition The Organization had no findings for contracts procured during the last three fiscal years that were detail tested. However, the Organization’s management recognizes that there are still active contracts under the federal programs for fiscal year ending August 31, 2024 that were procured over three fiscal years ago in which adherence to procurement policies, specifically documentation history of procurement, has not been maintained. In regards to progress made in reducing the number of vendors that are out of compliance, specifically vendors with over $50,000 of annual expenditures that were categorized as “legacy” vendors procured under the previous procurement policies, the Organization went from having 100 vendors totaling approximately $159 million in expenditures as of August 31, 2023, to 46 vendors totaling approximately $119 million as of August 31, 2024. This shows a decrease of 54% in the number of legacy vendors with a decrease of 25% in the dollar-value of the legacy vendors year over year. Further, the Organization continues to make progress in reducing legacy vendor non-compliance by reducing that number to 33 vendors totaling approximately $113 million as of January 2, 2025. As this has been a recurring finding in which management is actively getting all active contracts under the current procurement policies, only those current contracts that were procured in the last three fiscal years were detail tested. Of the approximately 70 active vendor contracts that were procured in the last three fiscal years that were wholly or partially funded with Unaccompanied Alien Children Program revenue dollars or with Child Nutrition Cluster Program revenue dollars, ten were tested with no errors noted. Cause The Organization is aware they are operating under contracts that were procured in previous years that may not have all the records maintained. Contracts procured within the last three years show compliance with federal requirements based on detailed testing. Reprocuring all of the legacy contracts at once would potentially cause disruptions in operations due to the products/services related those vendors playing an important role in the Organization’s day-to-day operations. As such, the Organization still has active contracts procured under the old policies that they are working on reprocuring as these contracts’ renewal dates arise, if not earlier. Effect or Potential Effect The Organization could potentially be under contract with vendors that are not the best value, not adequately qualified, potentially suspended or debarred, or otherwise not suitable for contract under federal procurement guidelines. No questioned costs were identified, as services/goods under these contracts that were previously tested were deemed to be allowable under the program, and no exceptions noted for allowable costs/activities for samples that included payment to those vendors in previous years or current year. Recommendation The Organization should continue to review all its “legacy” contracts that were procured under the previous procurement policies to determine if there is proper documentation maintained for compliance with applicable procurement guidelines. This includes systematically re-procuring any current contracts not in compliance as soon as feasible. Views of Responsible Officials and Planned Corrective Actions See corrective action plan.