Contracting with small businesses, minority businesses, women's business enterprises, veteran-owned businesses, and labor surplus area firms.
FINDING: 2023-003 – Procurement Federal Agency: U.S. Department of Agriculture & U.S. Department of Education Federal Program: Child Nutrition Cluster & Special Education Cluster CFDA Numbers: 10.555 & 84.027 and 84.173 Pass Through Agency: Minnesota Department of Education Pass Through Number: 01-0276-000-000, H027A220087, H027X210087, H173A220086, and H173X210086 Award Periods: Fiscal year ended June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: 2 CFR §200.318 - §200.321 requires that all procurement transactions be conducted in a manner providing full and open competition consistent with the standards of the section. Procurement by noncompetitive proposals may be utilized if the item is available only from a single source, however efforts must be made and the process fully documented in order to conclude that the use of a sole source procurement is appropriate. Condition: It was noted during procurement testing that the district did not document its process for concluding that procurements met the requirements of being a sole source situation. Questioned Costs: ALN 10.555 - $19,122.61 and ALN 84.027 and 84.173 - $68,100. Context: Of the 13 procurement transactions tested, 2 of them were considered sole source by the District but did not have the proper documentation to support the process used to determine that. Effect: The District was not in compliance with Uniform Guidance requirements for the proper documentation of all procurement transactions. Repeat Finding: Yes. 2022-001. Recommendation: We recommend the District reviews its procedures and controls over procurement to ensure that all procurements are documented such that a third party can clearly see and understand the detailed history of the procurement. Views of Responsible Official: There is no disagreement with the audit finding. The District will implement procedures to document its rationale for the procurement method used.
FINDING: 2023-003 – Procurement Federal Agency: U.S. Department of Agriculture & U.S. Department of Education Federal Program: Child Nutrition Cluster & Special Education Cluster CFDA Numbers: 10.555 & 84.027 and 84.173 Pass Through Agency: Minnesota Department of Education Pass Through Number: 01-0276-000-000, H027A220087, H027X210087, H173A220086, and H173X210086 Award Periods: Fiscal year ended June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: 2 CFR §200.318 - §200.321 requires that all procurement transactions be conducted in a manner providing full and open competition consistent with the standards of the section. Procurement by noncompetitive proposals may be utilized if the item is available only from a single source, however efforts must be made and the process fully documented in order to conclude that the use of a sole source procurement is appropriate. Condition: It was noted during procurement testing that the district did not document its process for concluding that procurements met the requirements of being a sole source situation. Questioned Costs: ALN 10.555 - $19,122.61 and ALN 84.027 and 84.173 - $68,100. Context: Of the 13 procurement transactions tested, 2 of them were considered sole source by the District but did not have the proper documentation to support the process used to determine that. Effect: The District was not in compliance with Uniform Guidance requirements for the proper documentation of all procurement transactions. Repeat Finding: Yes. 2022-001. Recommendation: We recommend the District reviews its procedures and controls over procurement to ensure that all procurements are documented such that a third party can clearly see and understand the detailed history of the procurement. Views of Responsible Official: There is no disagreement with the audit finding. The District will implement procedures to document its rationale for the procurement method used.
FINDING: 2023-003 – Procurement Federal Agency: U.S. Department of Agriculture & U.S. Department of Education Federal Program: Child Nutrition Cluster & Special Education Cluster CFDA Numbers: 10.555 & 84.027 and 84.173 Pass Through Agency: Minnesota Department of Education Pass Through Number: 01-0276-000-000, H027A220087, H027X210087, H173A220086, and H173X210086 Award Periods: Fiscal year ended June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: 2 CFR §200.318 - §200.321 requires that all procurement transactions be conducted in a manner providing full and open competition consistent with the standards of the section. Procurement by noncompetitive proposals may be utilized if the item is available only from a single source, however efforts must be made and the process fully documented in order to conclude that the use of a sole source procurement is appropriate. Condition: It was noted during procurement testing that the district did not document its process for concluding that procurements met the requirements of being a sole source situation. Questioned Costs: ALN 10.555 - $19,122.61 and ALN 84.027 and 84.173 - $68,100. Context: Of the 13 procurement transactions tested, 2 of them were considered sole source by the District but did not have the proper documentation to support the process used to determine that. Effect: The District was not in compliance with Uniform Guidance requirements for the proper documentation of all procurement transactions. Repeat Finding: Yes. 2022-001. Recommendation: We recommend the District reviews its procedures and controls over procurement to ensure that all procurements are documented such that a third party can clearly see and understand the detailed history of the procurement. Views of Responsible Official: There is no disagreement with the audit finding. The District will implement procedures to document its rationale for the procurement method used.
FINDING: 2023-003 – Procurement Federal Agency: U.S. Department of Agriculture & U.S. Department of Education Federal Program: Child Nutrition Cluster & Special Education Cluster CFDA Numbers: 10.555 & 84.027 and 84.173 Pass Through Agency: Minnesota Department of Education Pass Through Number: 01-0276-000-000, H027A220087, H027X210087, H173A220086, and H173X210086 Award Periods: Fiscal year ended June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: 2 CFR §200.318 - §200.321 requires that all procurement transactions be conducted in a manner providing full and open competition consistent with the standards of the section. Procurement by noncompetitive proposals may be utilized if the item is available only from a single source, however efforts must be made and the process fully documented in order to conclude that the use of a sole source procurement is appropriate. Condition: It was noted during procurement testing that the district did not document its process for concluding that procurements met the requirements of being a sole source situation. Questioned Costs: ALN 10.555 - $19,122.61 and ALN 84.027 and 84.173 - $68,100. Context: Of the 13 procurement transactions tested, 2 of them were considered sole source by the District but did not have the proper documentation to support the process used to determine that. Effect: The District was not in compliance with Uniform Guidance requirements for the proper documentation of all procurement transactions. Repeat Finding: Yes. 2022-001. Recommendation: We recommend the District reviews its procedures and controls over procurement to ensure that all procurements are documented such that a third party can clearly see and understand the detailed history of the procurement. Views of Responsible Official: There is no disagreement with the audit finding. The District will implement procedures to document its rationale for the procurement method used.
FINDING: 2023-003 – Procurement Federal Agency: U.S. Department of Agriculture & U.S. Department of Education Federal Program: Child Nutrition Cluster & Special Education Cluster CFDA Numbers: 10.555 & 84.027 and 84.173 Pass Through Agency: Minnesota Department of Education Pass Through Number: 01-0276-000-000, H027A220087, H027X210087, H173A220086, and H173X210086 Award Periods: Fiscal year ended June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: 2 CFR §200.318 - §200.321 requires that all procurement transactions be conducted in a manner providing full and open competition consistent with the standards of the section. Procurement by noncompetitive proposals may be utilized if the item is available only from a single source, however efforts must be made and the process fully documented in order to conclude that the use of a sole source procurement is appropriate. Condition: It was noted during procurement testing that the district did not document its process for concluding that procurements met the requirements of being a sole source situation. Questioned Costs: ALN 10.555 - $19,122.61 and ALN 84.027 and 84.173 - $68,100. Context: Of the 13 procurement transactions tested, 2 of them were considered sole source by the District but did not have the proper documentation to support the process used to determine that. Effect: The District was not in compliance with Uniform Guidance requirements for the proper documentation of all procurement transactions. Repeat Finding: Yes. 2022-001. Recommendation: We recommend the District reviews its procedures and controls over procurement to ensure that all procurements are documented such that a third party can clearly see and understand the detailed history of the procurement. Views of Responsible Official: There is no disagreement with the audit finding. The District will implement procedures to document its rationale for the procurement method used.
FINDING: 2023-003 – Procurement Federal Agency: U.S. Department of Agriculture & U.S. Department of Education Federal Program: Child Nutrition Cluster & Special Education Cluster CFDA Numbers: 10.555 & 84.027 and 84.173 Pass Through Agency: Minnesota Department of Education Pass Through Number: 01-0276-000-000, H027A220087, H027X210087, H173A220086, and H173X210086 Award Periods: Fiscal year ended June 30, 2023 Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: 2 CFR §200.318 - §200.321 requires that all procurement transactions be conducted in a manner providing full and open competition consistent with the standards of the section. Procurement by noncompetitive proposals may be utilized if the item is available only from a single source, however efforts must be made and the process fully documented in order to conclude that the use of a sole source procurement is appropriate. Condition: It was noted during procurement testing that the district did not document its process for concluding that procurements met the requirements of being a sole source situation. Questioned Costs: ALN 10.555 - $19,122.61 and ALN 84.027 and 84.173 - $68,100. Context: Of the 13 procurement transactions tested, 2 of them were considered sole source by the District but did not have the proper documentation to support the process used to determine that. Effect: The District was not in compliance with Uniform Guidance requirements for the proper documentation of all procurement transactions. Repeat Finding: Yes. 2022-001. Recommendation: We recommend the District reviews its procedures and controls over procurement to ensure that all procurements are documented such that a third party can clearly see and understand the detailed history of the procurement. Views of Responsible Official: There is no disagreement with the audit finding. The District will implement procedures to document its rationale for the procurement method used.
CONDITION: The Northern Cambria School District does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The Northern Cambria School District did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process. QUESTIONED COST: None RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
CONDITION: The Northern Cambria School District does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The Northern Cambria School District did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process. QUESTIONED COST: None RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
CONDITION: The Northern Cambria School District does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The Northern Cambria School District did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process. QUESTIONED COST: None RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
CONDITION: The Northern Cambria School District does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The Northern Cambria School District did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process. QUESTIONED COST: None RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
CONDITION: The Northern Cambria School District does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The Northern Cambria School District did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process. QUESTIONED COST: None RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
CONDITION: The Northern Cambria School District does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The Northern Cambria School District did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process. QUESTIONED COST: None RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
CONDITION: The Sto-Rox School District does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. EFFECT: The Sto-Rox School District did not comply with the requirements of Section 2 CFR 200.321(a) of the Uniform Guidance regarding required affirmative action steps to be employed in the procurement process. QUESTIONED COST: None CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
CONDITION: The Sto-Rox School District does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. EFFECT: The Sto-Rox School District did not comply with the requirements of Section 2 CFR 200.321(a) of the Uniform Guidance regarding required affirmative action steps to be employed in the procurement process. QUESTIONED COST: None CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
CONDITION: The Sto-Rox School District does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. EFFECT: The Sto-Rox School District did not comply with the requirements of Section 2 CFR 200.321(a) of the Uniform Guidance regarding required affirmative action steps to be employed in the procurement process. QUESTIONED COST: None CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
CONDITION: The Sto-Rox School District does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. EFFECT: The Sto-Rox School District did not comply with the requirements of Section 2 CFR 200.321(a) of the Uniform Guidance regarding required affirmative action steps to be employed in the procurement process. QUESTIONED COST: None CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
CONDITION: The Sto-Rox School District does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. EFFECT: The Sto-Rox School District did not comply with the requirements of Section 2 CFR 200.321(a) of the Uniform Guidance regarding required affirmative action steps to be employed in the procurement process. QUESTIONED COST: None CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
CONDITION: In connection with the Cambria Heights School District’s RTU Replacement Project, the District did not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms were used, when possible, in the procurement process. This is a repeat finding (2022-008) from the previous fiscal year. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The Cambria Heights School District did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process. QUESTIONED COST: Hranec Sheet Metal, Inc. - $1,058,759, Westmoreland Electric Services – $92,163. RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: The School District concurs with the above noted finding and addresses this issue in the ‘Corrective Action Plan’ included within this report.
CONDITION: In connection with the Cambria Heights School District’s RTU Replacement Project, the District did not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms were used, when possible, in the procurement process. This is a repeat finding (2022-008) from the previous fiscal year. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The Cambria Heights School District did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process. QUESTIONED COST: Hranec Sheet Metal, Inc. - $1,058,759, Westmoreland Electric Services – $92,163. RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: The School District concurs with the above noted finding and addresses this issue in the ‘Corrective Action Plan’ included within this report.
CONDITION: In connection with the Cambria Heights School District’s RTU Replacement Project, the District did not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms were used, when possible, in the procurement process. This is a repeat finding (2022-008) from the previous fiscal year. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The Cambria Heights School District did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process. QUESTIONED COST: Hranec Sheet Metal, Inc. - $1,058,759, Westmoreland Electric Services – $92,163. RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: The School District concurs with the above noted finding and addresses this issue in the ‘Corrective Action Plan’ included within this report.
CONDITION: In connection with the Cambria Heights School District’s RTU Replacement Project, the District did not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms were used, when possible, in the procurement process. This is a repeat finding (2022-008) from the previous fiscal year. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The Cambria Heights School District did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process. QUESTIONED COST: Hranec Sheet Metal, Inc. - $1,058,759, Westmoreland Electric Services – $92,163. RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: The School District concurs with the above noted finding and addresses this issue in the ‘Corrective Action Plan’ included within this report.
CONDITION: In connection with the Cambria Heights School District’s RTU Replacement Project, the District did not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms were used, when possible, in the procurement process. This is a repeat finding (2022-008) from the previous fiscal year. CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. Section 2 CFR 200.321(a) of the Uniform Guidance outlines the six (6) affirmative steps to follow. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The Cambria Heights School District did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process. QUESTIONED COST: Hranec Sheet Metal, Inc. - $1,058,759, Westmoreland Electric Services – $92,163. RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) affirmative action steps as stated Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: The School District concurs with the above noted finding and addresses this issue in the ‘Corrective Action Plan’ included within this report.
Assistance Listings number and name: 14.267 Continuum of Care Program Award number and year: AZ9999U9T002101, February 1, 2022 through June 30, 2023 Federal agency: U.S. Department of Housing and Urban Development Compliance requirement: Procurement Questioned costs: Unknown Condition—Contrary to federal regulations, the Department’s policies and procedures did not include provisions required by the federal regulations, and the Department did not retain documentation to support procurement actions for 2 vendors we tested. Specifically, the Department’s policies and procedures did not require procurement transactions to be documented or conducted in a manner providing full and open competition. Further, the Department did not include items required by federal regulations such as contracting with small and minority businesses, women’s business enterprises, veteran-owned businesses, and labor surplus area firms; domestic preferences for procurements; procurement of recovered materials; and required federal contract provisions. Further, the Department paid the 2 vendors we tested $257,165 for administrative support services during fiscal year 2023 without retaining procurement action documentation such as requests for proposals, contracts, or other documents demonstrating the Department’s compliance with federal procurement requirements. Effect—The Department’s policies and procedures not complying with federal regulations and not maintaining documentation of its procurement actions increased the Department’s risk of not: • Receiving the most advantageous prices for the goods and services purchased with federal monies. • Considering eligible small and minority businesses, women's business enterprises, veteran-owned businesses, and labor surplus area firms as potential vendors. • Giving preference to procure goods, products, and materials produced in the United States. • Considering purchasing products or services that can be reused, refurbished, or recycled. Finally, the Department is at risk that this finding applies to other federal programs it administers. Cause—The Department did not establish and maintain effective internal control over the program’s procurement requirements that provided reasonable assurance that it was managing the program’s awards in compliance with federal regulations. Department management reported that because the Department does not have to comply with State procurement requirements, they did not think about and consider federal regulations when developing written procurement policies and procedures and procuring program services for federal awards.1 Further, Department management reported they have no record of when the Department awarded the administrative service contracts because the contracts are at least 15 years old, and the records are either not accessible in storage or were destroyed. Criteria—Federal regulations require the Department to follow the same policies and procedures it uses for nonfederal procurements and to retain all records related to a federal program, including procurement action documentation, for a period of 3 years from the date the program’s final report was submitted to the federal awarding agency or pass-through grantor (2 CFR §§ 200.317 and 200.334). Federal regulations also require the Department to comply with procurement standards for contracting with small and minority businesses, women’s business enterprises, veteran-owned businesses, and labor surplus area firms; domestic preferences for procurements; and procurement of recovered materials; and ensure that every purchase order or contract includes required federal contract provisions (2 CFR §§200.321, 200.322, 200.323, and 200.327). Further, federal regulation requires establishing and maintaining effective internal control over federal awards that provides reasonable assurance that federal program is being managed in compliance with all applicable laws, regulations, and award terms (2 CFR §200.303). Recommendations—The Department should: 1. Establish and maintain effective internal control over the program’s procurement requirements by updating its written policies and procedures to: a. Retain procurement action documentation for a period of 3 years from the date the program’s final report was submitted to the federal awarding agency. b. Require full and open competition using requests for competitively bid proposals. Alternatively, document each sole source procurement only after conducting a good-faith search for available sources and concluding there is only a single source and include it in the contract file. c. Document compliance with procurement standards for contracting with small and minority businesses, women’s business enterprises, veteran-owned businesses, and labor surplus area firms; domestic preferences for procurements; and procurement of recovered materials. d. Ensure that every purchase order or contract includes required federal contract provisions. 2. Retain procurement action documentation when procuring property and services using federal funds in accordance with federal records retention requirements, ensuring compliance with federal procurement requirements. The State’s corrective action plan at the end of this report includes the views and planned corrective action of its responsible officials. We are not required to audit and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy. 1 The Department is exempt from following the State’s procurement code (Arizona Revised Statutes §41-3953[D]).
Assistance Listings number and name: 14.267 Continuum of Care Program Award number and year: AZ9999U9T002101, February 1, 2022 through June 30, 2023 Federal agency: U.S. Department of Housing and Urban Development Compliance requirement: Procurement Questioned costs: Unknown Condition—Contrary to federal regulations, the Department’s policies and procedures did not include provisions required by the federal regulations, and the Department did not retain documentation to support procurement actions for 2 vendors we tested. Specifically, the Department’s policies and procedures did not require procurement transactions to be documented or conducted in a manner providing full and open competition. Further, the Department did not include items required by federal regulations such as contracting with small and minority businesses, women’s business enterprises, veteran-owned businesses, and labor surplus area firms; domestic preferences for procurements; procurement of recovered materials; and required federal contract provisions. Further, the Department paid the 2 vendors we tested $257,165 for administrative support services during fiscal year 2023 without retaining procurement action documentation such as requests for proposals, contracts, or other documents demonstrating the Department’s compliance with federal procurement requirements. Effect—The Department’s policies and procedures not complying with federal regulations and not maintaining documentation of its procurement actions increased the Department’s risk of not: • Receiving the most advantageous prices for the goods and services purchased with federal monies. • Considering eligible small and minority businesses, women's business enterprises, veteran-owned businesses, and labor surplus area firms as potential vendors. • Giving preference to procure goods, products, and materials produced in the United States. • Considering purchasing products or services that can be reused, refurbished, or recycled. Finally, the Department is at risk that this finding applies to other federal programs it administers. Cause—The Department did not establish and maintain effective internal control over the program’s procurement requirements that provided reasonable assurance that it was managing the program’s awards in compliance with federal regulations. Department management reported that because the Department does not have to comply with State procurement requirements, they did not think about and consider federal regulations when developing written procurement policies and procedures and procuring program services for federal awards.1 Further, Department management reported they have no record of when the Department awarded the administrative service contracts because the contracts are at least 15 years old, and the records are either not accessible in storage or were destroyed. Criteria—Federal regulations require the Department to follow the same policies and procedures it uses for nonfederal procurements and to retain all records related to a federal program, including procurement action documentation, for a period of 3 years from the date the program’s final report was submitted to the federal awarding agency or pass-through grantor (2 CFR §§ 200.317 and 200.334). Federal regulations also require the Department to comply with procurement standards for contracting with small and minority businesses, women’s business enterprises, veteran-owned businesses, and labor surplus area firms; domestic preferences for procurements; and procurement of recovered materials; and ensure that every purchase order or contract includes required federal contract provisions (2 CFR §§200.321, 200.322, 200.323, and 200.327). Further, federal regulation requires establishing and maintaining effective internal control over federal awards that provides reasonable assurance that federal program is being managed in compliance with all applicable laws, regulations, and award terms (2 CFR §200.303). Recommendations—The Department should: 1. Establish and maintain effective internal control over the program’s procurement requirements by updating its written policies and procedures to: a. Retain procurement action documentation for a period of 3 years from the date the program’s final report was submitted to the federal awarding agency. b. Require full and open competition using requests for competitively bid proposals. Alternatively, document each sole source procurement only after conducting a good-faith search for available sources and concluding there is only a single source and include it in the contract file. c. Document compliance with procurement standards for contracting with small and minority businesses, women’s business enterprises, veteran-owned businesses, and labor surplus area firms; domestic preferences for procurements; and procurement of recovered materials. d. Ensure that every purchase order or contract includes required federal contract provisions. 2. Retain procurement action documentation when procuring property and services using federal funds in accordance with federal records retention requirements, ensuring compliance with federal procurement requirements. The State’s corrective action plan at the end of this report includes the views and planned corrective action of its responsible officials. We are not required to audit and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy. 1 The Department is exempt from following the State’s procurement code (Arizona Revised Statutes §41-3953[D]).
CONDITION: The School District of the City of Monessen does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. This is a repeat finding from the 2021-2022 fiscal year – Finding 2022-002 CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. The Uniform Guidance specifies six (6) affirmative action steps that must be taken. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The School District of the City of Monessen did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process.QUESTIONED COST: None RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) recommended affirmative action steps as stated in Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
CONDITION: The School District of the City of Monessen does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. This is a repeat finding from the 2021-2022 fiscal year – Finding 2022-002 CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. The Uniform Guidance specifies six (6) affirmative action steps that must be taken. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The School District of the City of Monessen did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process.QUESTIONED COST: None RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) recommended affirmative action steps as stated in Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
CONDITION: The School District of the City of Monessen does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. This is a repeat finding from the 2021-2022 fiscal year – Finding 2022-002 CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. The Uniform Guidance specifies six (6) affirmative action steps that must be taken. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The School District of the City of Monessen did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process.QUESTIONED COST: None RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) recommended affirmative action steps as stated in Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
CONDITION: The School District of the City of Monessen does not take affirmative action steps to ensure that minority businesses, women’s business enterprises, and labor surplus area firms are used, when possible, in the procurement process. This is a repeat finding from the 2021-2022 fiscal year – Finding 2022-002 CRITERIA: In accordance with Section 2 CFR 200.321(a) of the Uniform Guidance, the District must take all necessary affirmative action steps to assure that minority businesses, women’s business enterprises, and labor surplus area firms are used when possible. The Uniform Guidance specifies six (6) affirmative action steps that must be taken. CAUSE: School District personnel stated that these businesses are considered but recognized that no affirmative action steps are currently employed to solicit these businesses. EFFECT: The School District of the City of Monessen did not comply with the requirements of 2 CFR 200.321(a) of the Uniform Guidance with regard to required affirmative action steps to be employed in the procurement process.QUESTIONED COST: None RECOMMENDATION: I am recommending that the management of the School District implement, as a matter of policy, the six (6) recommended affirmative action steps as stated in Section 2 CFR 200.321(a) of the Uniform Guidance. VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and have developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).
Finding Number: 2022‐001 Repeat Finding: No Program Name/Assistance Listing Title: COVID‐19 Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Agency: U.S. Department of Treasury Federal Award Number: ISA‐ARPA‐AZABGC‐042022‐47, GR‐GEER‐AZABGC‐040122‐01 Pass‐Through Agency: Arizona Alliance of Boys and Girls Clubs Questioned Costs: N/A Type of Finding: Noncompliance, Material Weakness Compliance Requirement: Procurement and Suspension and Debarment 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 §§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. Additionally, non‐federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. When a non‐federal entity enters into a covered transaction with an entity at a lower tier, the non‐federal entity must verify that the entity, as defined in 2 CFR §180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System of Award Management (SAM) maintained by the General Services Administration (GSA) or (2) collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity (2 CFR §180.300). Condition The Club did not have proper internal controls over procurement to ensure compliance with federal regulations and guidelines. Adequate supporting documentation was not maintained to demonstrate compliance with procurement standards. In addition, the Club’s written procurement standards did not align with federal regulations and guidelines. Cause The Club’s internal controls over procurement of goods and services were not adequate. Effect The Club was not in compliance with Federal regulations and guidelines related to procurement. Context During our review of procurement, we noted the following: - The Club does not have a policy or procedure in place that requires a verification check of suspension and debarment for covered transactions. One purchase charged to the program exceeded $25,000; however, the Club did not perform a verification check. Audit procedures determined the vendor was not suspended or debarred. - The Club’s procurement policies did not address §200.321 Contracting with small and minority businesses, women's business enterprises, and labor surplus area firms or §200.322 Domestic preferences for procurements. - For purchases with two vendors exceeding the micro‐purchase threshold but less than the Simplified Acquisition Threshold, the Club did not maintain records sufficient to detail the procurement performed for these vendors. The sample was not intended to be, and was not, a statistically valid sample Recommendation The Club should develop and implement policies and procedures to ensure compliance with federal procurement requirements. Additionally, procurement records should be retained, and should 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. Views of Responsible Officials See Corrective Action Plan.
Finding Number: 2022‐001 Repeat Finding: No Program Name/Assistance Listing Title: COVID‐19 Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Agency: U.S. Department of Treasury Federal Award Number: ISA‐ARPA‐AZABGC‐042022‐47, GR‐GEER‐AZABGC‐040122‐01 Pass‐Through Agency: Arizona Alliance of Boys and Girls Clubs Questioned Costs: N/A Type of Finding: Noncompliance, Material Weakness Compliance Requirement: Procurement and Suspension and Debarment 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 §§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. Additionally, non‐federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. When a non‐federal entity enters into a covered transaction with an entity at a lower tier, the non‐federal entity must verify that the entity, as defined in 2 CFR §180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System of Award Management (SAM) maintained by the General Services Administration (GSA) or (2) collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity (2 CFR §180.300). Condition The Club did not have proper internal controls over procurement to ensure compliance with federal regulations and guidelines. Adequate supporting documentation was not maintained to demonstrate compliance with procurement standards. In addition, the Club’s written procurement standards did not align with federal regulations and guidelines. Cause The Club’s internal controls over procurement of goods and services were not adequate. Effect The Club was not in compliance with Federal regulations and guidelines related to procurement. Context During our review of procurement, we noted the following: - The Club does not have a policy or procedure in place that requires a verification check of suspension and debarment for covered transactions. One purchase charged to the program exceeded $25,000; however, the Club did not perform a verification check. Audit procedures determined the vendor was not suspended or debarred. - The Club’s procurement policies did not address §200.321 Contracting with small and minority businesses, women's business enterprises, and labor surplus area firms or §200.322 Domestic preferences for procurements. - For purchases with two vendors exceeding the micro‐purchase threshold but less than the Simplified Acquisition Threshold, the Club did not maintain records sufficient to detail the procurement performed for these vendors. The sample was not intended to be, and was not, a statistically valid sample Recommendation The Club should develop and implement policies and procedures to ensure compliance with federal procurement requirements. Additionally, procurement records should be retained, and should 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. Views of Responsible Officials See Corrective Action Plan.
Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of suspension and debarment. The Loan Fund should have internal controls designed to ensure compliance with this provision. 2 CFR 200.318-200.321 outline requirements to maintain records sufficient to detail the history of procurement, requirements for competition, methods and purchasing thresholds, as well as other requirements for contracting with organizations with using federal funds. The Loan Fund?s policies do not meet these requirements. Condition: During our testing, we noted that the Loan Fund internal controls and accounting policies were not sufficient in regard to federal requirements for procurements and for ensuring vendors and contractors used are not suspended or debarred. Questioned costs: None. The Loan Fund did not enter into any contracts with disallowed parties, and there were no issues with mircopurchases tested. The Loan Fund policies and procedures do not contain necessary controls to ensure compliance with the requirements for suspension and debarment or procurements. As such, they were not sufficient to ensure material compliance with this compliance requirement. Context: See Condition. Cause: Lack of established controls and procedures over requirements for procurements and federal principals for suspension and debarment. Effect: Possible noncompliance with federal requirements for procurements using federal monies. Possibility to enter into a covered transaction with a noneligible contractor or vendor. Recommendation: We recommend that the Loan Fund reviews the current financial policies and procedures in order to better serve the organization in documenting compliance with federal cost principals and requirements. Views of responsible officials: There is no disagreement with the audit finding. Management accepts this finding and has made efforts to review and update our policies to meet federal cost principals and requirements. These are currently pending approval by the Board of Directors for implementation.
Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of suspension and debarment. The Loan Fund should have internal controls designed to ensure compliance with this provision. 2 CFR 200.318-200.321 outline requirements to maintain records sufficient to detail the history of procurement, requirements for competition, methods and purchasing thresholds, as well as other requirements for contracting with organizations with using federal funds. The Loan Fund?s policies do not meet these requirements. Condition: During our testing, we noted that the Loan Fund internal controls and accounting policies were not sufficient in regard to federal requirements for procurements and for ensuring vendors and contractors used are not suspended or debarred. Questioned costs: None. The Loan Fund did not enter into any contracts with disallowed parties, and there were no issues with mircopurchases tested. The Loan Fund policies and procedures do not contain necessary controls to ensure compliance with the requirements for suspension and debarment or procurements. As such, they were not sufficient to ensure material compliance with this compliance requirement. Context: See Condition. Cause: Lack of established controls and procedures over requirements for procurements and federal principals for suspension and debarment. Effect: Possible noncompliance with federal requirements for procurements using federal monies. Possibility to enter into a covered transaction with a noneligible contractor or vendor. Recommendation: We recommend that the Loan Fund reviews the current financial policies and procedures in order to better serve the organization in documenting compliance with federal cost principals and requirements. Views of responsible officials: There is no disagreement with the audit finding. Management accepts this finding and has made efforts to review and update our policies to meet federal cost principals and requirements. These are currently pending approval by the Board of Directors for implementation.
Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of suspension and debarment. The Loan Fund should have internal controls designed to ensure compliance with this provision. 2 CFR 200.318-200.321 outline requirements to maintain records sufficient to detail the history of procurement, requirements for competition, methods and purchasing thresholds, as well as other requirements for contracting with organizations with using federal funds. The Loan Fund?s policies do not meet these requirements. Condition: During our testing, we noted that the Loan Fund internal controls and accounting policies were not sufficient in regard to federal requirements for procurements and for ensuring vendors and contractors used are not suspended or debarred. Questioned costs: None. The Loan Fund did not enter into any contracts with disallowed parties, and there were no issues with mircopurchases tested. The Loan Fund policies and procedures do not contain necessary controls to ensure compliance with the requirements for suspension and debarment or procurements. As such, they were not sufficient to ensure material compliance with this compliance requirement. Context: See Condition. Cause: Lack of established controls and procedures over requirements for procurements and federal principals for suspension and debarment. Effect: Possible noncompliance with federal requirements for procurements using federal monies. Possibility to enter into a covered transaction with a noneligible contractor or vendor. Recommendation: We recommend that the Loan Fund reviews the current financial policies and procedures in order to better serve the organization in documenting compliance with federal cost principals and requirements. Views of responsible officials: There is no disagreement with the audit finding. Management accepts this finding and has made efforts to review and update our policies to meet federal cost principals and requirements. These are currently pending approval by the Board of Directors for implementation.
Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of suspension and debarment. The Loan Fund should have internal controls designed to ensure compliance with this provision. 2 CFR 200.318-200.321 outline requirements to maintain records sufficient to detail the history of procurement, requirements for competition, methods and purchasing thresholds, as well as other requirements for contracting with organizations with using federal funds. The Loan Fund?s policies do not meet these requirements. Condition: During our testing, we noted that the Loan Fund internal controls and accounting policies were not sufficient in regard to federal requirements for procurements and for ensuring vendors and contractors used are not suspended or debarred. Questioned costs: None. The Loan Fund did not enter into any contracts with disallowed parties, and there were no issues with mircopurchases tested. The Loan Fund policies and procedures do not contain necessary controls to ensure compliance with the requirements for suspension and debarment or procurements. As such, they were not sufficient to ensure material compliance with this compliance requirement. Context: See Condition. Cause: Lack of established controls and procedures over requirements for procurements and federal principals for suspension and debarment. Effect: Possible noncompliance with federal requirements for procurements using federal monies. Possibility to enter into a covered transaction with a noneligible contractor or vendor. Recommendation: We recommend that the Loan Fund reviews the current financial policies and procedures in order to better serve the organization in documenting compliance with federal cost principals and requirements. Views of responsible officials: There is no disagreement with the audit finding. Management accepts this finding and has made efforts to review and update our policies to meet federal cost principals and requirements. These are currently pending approval by the Board of Directors for implementation.
ALN 21.027 U.S. Department of Treasury Criteria: The U.S. Department of Treasury established procurement requirements for local governments as outlined in sections 602(c) and 603(c) of the Act and Treasury?s Interim Final Rule. These requirements established procurement procedures for Coronavirus State and Local Fiscal Recovery Fund (SLFRF) expenditures to comply with 2 CFR 200.321 ? 200.323. Condition: The County had a project that was subject to procurement requirements but was not competitively bid. Context: During our review of the SLFRF expenditures, we noted the County had $62,752 in expenditures for a broadband improvement project subject to procurement requirements that was not procured in accordance with Uniform Guidance. Effect: $62,752 of expenditures are considered questioned costs due to being paid on a contract that was not in compliance with procurement requirements. Cause: Lack of sufficient internal controls over the procurement requirements of the SLFRF program. Recommendation: We recommend the County enhance its internal controls over procurement to meet the requirements of the SLFRF program by implementing procurement policies and procedures that comply with procurement standards outlined in the Uniform Guidance.
Finding 2022-003: Lack of Documented Procurement Procedures U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES Section 223 Demonstration Programs for Improving Community Mental Health Services – Assistance Listing No. 93.829 Compliance Findings: Procurement and Suspension and Debarment (I) Criteria: The Standard Terms and Conditons for all SAMHSA’s awards requires that grantees comply with Title 2 U.S. Code of Federal Regulation (CFR) section 200.318 through 200.321. In accordance with 2 CFR section 200.320, a non-federal entity must have and use documented procurement procedures, consistent with the standards of 2 CFR section 200.317 through 200.320 for any method of procurement used for the acquisition of property or services required under a federal award or sub-award. Condition: The Organization does not have documented procurement procedures that incorporate all the requirements of 2 CFR section 200.317 through 200.320. Cause: Unknown. Questioned Costs: None. Effect: The Organization is not in compliance with 2 CFR section 200.320 or the terms of the grant agreement. Identification of Repeat Finding: Not a repeat finding. Recommendation: We recommend that the Organization adopt a written procurement policy which includes all requirements of 2 CFR section 200.317 through 200.320. Views of Responsible Officials: The Organization agrees with the finding and will adopt a documented procurement policy consistent with the standards of 2 CFR section 200.317 through 200.320 to use for procurement of the acquisition of property or services required under federal awards or sub-awards. Additional details can be found in the Organization’s Corrective Action Plan.
Finding: Procurement, Suspension and Debarment (Significant Deficiency; Other Matter) Federal Assistance Listing Number 14.862 – Indian Community Development Block Grant Award Number – B-18-SR-40-0584 & B-19-SR-40-0584; Award Year 2018 & 2019 Federal Assistance Listing Number 21.027 – Coronavirus State and Local Fiscal Recovery Funds Award Number – 8L-SS-2021-0901-001; Award Year 2021 Suspension and Debarment Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart C, 200.214 - Recipients and subrecipients are subject to the procurement, debarment and suspension regulations implementing Executive Orders 12549 and 12689, as well as 2 CFR part 180. The regulations in 2 CFR Part 180 restrict making Federal awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from receiving or participating in Federal awards. Procurement Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, 200.321 - When possible, the recipient or subrecipient should ensure there is open competition for non-micro purchases and an equitable distribution among suppliers for micro purchases. Condition: The Tribe was unable to provide supporting documentation showing that a verification had been performed to ensure vendors were not suspended or debarred. Several large purchases were sole sourced without adequate documentation. A high volume of micro purchases were made from the same vendor rather than being distributed equitably amount a variety of vendors. Questioned Costs: None. Context: 14.862 - Three procurements were tested noting two in which suspension and debarment checks were not performed. A high volume of micro purchases ($148,908) were made from the same vendor rather than an equitable distribution of vendors. 21.027 - 14 procurements were tested. Ten procurements tested were subject to suspension and debarment of which checks were not performed on nine. All 14 procurements tested were subject to non-micro purchase requirements. Six procurements were sole sourced without adequate supporting documentation to support this method of purchase. A non-statistical sampling methodology was used to select the samples. Effect: The Tribe's inability to furnish supporting documentation showing that a check to ensure vendors were not suspended or debarred on SAM.gov could result in the use of ineligible vendors. The Tribe's failure to provide for open competition or provide for an equitable distribution of vendors on purchases could result in the Tribe paying more for services than is reasonable or necessary. Cause: Tribal policies were not followed surrounding the requirement of suspension and debarment checks and documentation of sole source procurements. Due to the Tribal location, there may be some limitation of available vendors for consideration to ensure an equitable distribution. Identification as a Repeat Finding: 2021-005 (same issue in different program) Recommendation: We recommend the Department ensure existing procurement, suspension and debarment policies are understood throughout the Tribe and supporting documentation is adequate and maintained for all procurement decisions. Views of Responsible Officials: The Department agrees with the finding. See separate report for planned corrective actions.
Finding: Procurement, Suspension and Debarment (Significant Deficiency; Other Matter) Federal Assistance Listing Number 14.862 – Indian Community Development Block Grant Award Number – B-18-SR-40-0584 & B-19-SR-40-0584; Award Year 2018 & 2019 Federal Assistance Listing Number 21.027 – Coronavirus State and Local Fiscal Recovery Funds Award Number – 8L-SS-2021-0901-001; Award Year 2021 Suspension and Debarment Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart C, 200.214 - Recipients and subrecipients are subject to the procurement, debarment and suspension regulations implementing Executive Orders 12549 and 12689, as well as 2 CFR part 180. The regulations in 2 CFR Part 180 restrict making Federal awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from receiving or participating in Federal awards. Procurement Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, 200.321 - When possible, the recipient or subrecipient should ensure there is open competition for non-micro purchases and an equitable distribution among suppliers for micro purchases. Condition: The Tribe was unable to provide supporting documentation showing that a verification had been performed to ensure vendors were not suspended or debarred. Several large purchases were sole sourced without adequate documentation. A high volume of micro purchases were made from the same vendor rather than being distributed equitably amount a variety of vendors. Questioned Costs: None. Context: 14.862 - Three procurements were tested noting two in which suspension and debarment checks were not performed. A high volume of micro purchases ($148,908) were made from the same vendor rather than an equitable distribution of vendors. 21.027 - 14 procurements were tested. Ten procurements tested were subject to suspension and debarment of which checks were not performed on nine. All 14 procurements tested were subject to non-micro purchase requirements. Six procurements were sole sourced without adequate supporting documentation to support this method of purchase. A non-statistical sampling methodology was used to select the samples. Effect: The Tribe's inability to furnish supporting documentation showing that a check to ensure vendors were not suspended or debarred on SAM.gov could result in the use of ineligible vendors. The Tribe's failure to provide for open competition or provide for an equitable distribution of vendors on purchases could result in the Tribe paying more for services than is reasonable or necessary. Cause: Tribal policies were not followed surrounding the requirement of suspension and debarment checks and documentation of sole source procurements. Due to the Tribal location, there may be some limitation of available vendors for consideration to ensure an equitable distribution. Identification as a Repeat Finding: 2021-005 (same issue in different program) Recommendation: We recommend the Department ensure existing procurement, suspension and debarment policies are understood throughout the Tribe and supporting documentation is adequate and maintained for all procurement decisions. Views of Responsible Officials: The Department agrees with the finding. See separate report for planned corrective actions.
Finding: Procurement, Suspension and Debarment (Significant Deficiency; Other Matter) Federal Assistance Listing Number 14.862 – Indian Community Development Block Grant Award Number – B-18-SR-40-0584 & B-19-SR-40-0584; Award Year 2018 & 2019 Federal Assistance Listing Number 21.027 – Coronavirus State and Local Fiscal Recovery Funds Award Number – 8L-SS-2021-0901-001; Award Year 2021 Suspension and Debarment Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart C, 200.214 - Recipients and subrecipients are subject to the procurement, debarment and suspension regulations implementing Executive Orders 12549 and 12689, as well as 2 CFR part 180. The regulations in 2 CFR Part 180 restrict making Federal awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from receiving or participating in Federal awards. Procurement Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, 200.321 - When possible, the recipient or subrecipient should ensure there is open competition for non-micro purchases and an equitable distribution among suppliers for micro purchases. Condition: The Tribe was unable to provide supporting documentation showing that a verification had been performed to ensure vendors were not suspended or debarred. Several large purchases were sole sourced without adequate documentation. A high volume of micro purchases were made from the same vendor rather than being distributed equitably amount a variety of vendors. Questioned Costs: None. Context: 14.862 - Three procurements were tested noting two in which suspension and debarment checks were not performed. A high volume of micro purchases ($148,908) were made from the same vendor rather than an equitable distribution of vendors. 21.027 - 14 procurements were tested. Ten procurements tested were subject to suspension and debarment of which checks were not performed on nine. All 14 procurements tested were subject to non-micro purchase requirements. Six procurements were sole sourced without adequate supporting documentation to support this method of purchase. A non-statistical sampling methodology was used to select the samples. Effect: The Tribe's inability to furnish supporting documentation showing that a check to ensure vendors were not suspended or debarred on SAM.gov could result in the use of ineligible vendors. The Tribe's failure to provide for open competition or provide for an equitable distribution of vendors on purchases could result in the Tribe paying more for services than is reasonable or necessary. Cause: Tribal policies were not followed surrounding the requirement of suspension and debarment checks and documentation of sole source procurements. Due to the Tribal location, there may be some limitation of available vendors for consideration to ensure an equitable distribution. Identification as a Repeat Finding: 2021-005 (same issue in different program) Recommendation: We recommend the Department ensure existing procurement, suspension and debarment policies are understood throughout the Tribe and supporting documentation is adequate and maintained for all procurement decisions. Views of Responsible Officials: The Department agrees with the finding. See separate report for planned corrective actions.
Finding Number: 2022‐001 Repeat Finding: No Program Name/Assistance Listing Title: COVID‐19 Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Agency: U.S. Department of Treasury Federal Award Number: ISA‐ARPA‐AZABGC‐042022‐47, GR‐GEER‐AZABGC‐040122‐01 Pass‐Through Agency: Arizona Alliance of Boys and Girls Clubs Questioned Costs: N/A Type of Finding: Noncompliance, Material Weakness Compliance Requirement: Procurement and Suspension and Debarment 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 §§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. Additionally, non‐federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. When a non‐federal entity enters into a covered transaction with an entity at a lower tier, the non‐federal entity must verify that the entity, as defined in 2 CFR §180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System of Award Management (SAM) maintained by the General Services Administration (GSA) or (2) collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity (2 CFR §180.300). Condition The Club did not have proper internal controls over procurement to ensure compliance with federal regulations and guidelines. Adequate supporting documentation was not maintained to demonstrate compliance with procurement standards. In addition, the Club’s written procurement standards did not align with federal regulations and guidelines. Cause The Club’s internal controls over procurement of goods and services were not adequate. Effect The Club was not in compliance with Federal regulations and guidelines related to procurement. Context During our review of procurement, we noted the following: - The Club does not have a policy or procedure in place that requires a verification check of suspension and debarment for covered transactions. One purchase charged to the program exceeded $25,000; however, the Club did not perform a verification check. Audit procedures determined the vendor was not suspended or debarred. - The Club’s procurement policies did not address §200.321 Contracting with small and minority businesses, women's business enterprises, and labor surplus area firms or §200.322 Domestic preferences for procurements. - For purchases with two vendors exceeding the micro‐purchase threshold but less than the Simplified Acquisition Threshold, the Club did not maintain records sufficient to detail the procurement performed for these vendors. The sample was not intended to be, and was not, a statistically valid sample Recommendation The Club should develop and implement policies and procedures to ensure compliance with federal procurement requirements. Additionally, procurement records should be retained, and should 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. Views of Responsible Officials See Corrective Action Plan.
Finding Number: 2022‐001 Repeat Finding: No Program Name/Assistance Listing Title: COVID‐19 Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Agency: U.S. Department of Treasury Federal Award Number: ISA‐ARPA‐AZABGC‐042022‐47, GR‐GEER‐AZABGC‐040122‐01 Pass‐Through Agency: Arizona Alliance of Boys and Girls Clubs Questioned Costs: N/A Type of Finding: Noncompliance, Material Weakness Compliance Requirement: Procurement and Suspension and Debarment 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 §§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. Additionally, non‐federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. When a non‐federal entity enters into a covered transaction with an entity at a lower tier, the non‐federal entity must verify that the entity, as defined in 2 CFR §180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System of Award Management (SAM) maintained by the General Services Administration (GSA) or (2) collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity (2 CFR §180.300). Condition The Club did not have proper internal controls over procurement to ensure compliance with federal regulations and guidelines. Adequate supporting documentation was not maintained to demonstrate compliance with procurement standards. In addition, the Club’s written procurement standards did not align with federal regulations and guidelines. Cause The Club’s internal controls over procurement of goods and services were not adequate. Effect The Club was not in compliance with Federal regulations and guidelines related to procurement. Context During our review of procurement, we noted the following: - The Club does not have a policy or procedure in place that requires a verification check of suspension and debarment for covered transactions. One purchase charged to the program exceeded $25,000; however, the Club did not perform a verification check. Audit procedures determined the vendor was not suspended or debarred. - The Club’s procurement policies did not address §200.321 Contracting with small and minority businesses, women's business enterprises, and labor surplus area firms or §200.322 Domestic preferences for procurements. - For purchases with two vendors exceeding the micro‐purchase threshold but less than the Simplified Acquisition Threshold, the Club did not maintain records sufficient to detail the procurement performed for these vendors. The sample was not intended to be, and was not, a statistically valid sample Recommendation The Club should develop and implement policies and procedures to ensure compliance with federal procurement requirements. Additionally, procurement records should be retained, and should 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. Views of Responsible Officials See Corrective Action Plan.
Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of suspension and debarment. The Loan Fund should have internal controls designed to ensure compliance with this provision. 2 CFR 200.318-200.321 outline requirements to maintain records sufficient to detail the history of procurement, requirements for competition, methods and purchasing thresholds, as well as other requirements for contracting with organizations with using federal funds. The Loan Fund?s policies do not meet these requirements. Condition: During our testing, we noted that the Loan Fund internal controls and accounting policies were not sufficient in regard to federal requirements for procurements and for ensuring vendors and contractors used are not suspended or debarred. Questioned costs: None. The Loan Fund did not enter into any contracts with disallowed parties, and there were no issues with mircopurchases tested. The Loan Fund policies and procedures do not contain necessary controls to ensure compliance with the requirements for suspension and debarment or procurements. As such, they were not sufficient to ensure material compliance with this compliance requirement. Context: See Condition. Cause: Lack of established controls and procedures over requirements for procurements and federal principals for suspension and debarment. Effect: Possible noncompliance with federal requirements for procurements using federal monies. Possibility to enter into a covered transaction with a noneligible contractor or vendor. Recommendation: We recommend that the Loan Fund reviews the current financial policies and procedures in order to better serve the organization in documenting compliance with federal cost principals and requirements. Views of responsible officials: There is no disagreement with the audit finding. Management accepts this finding and has made efforts to review and update our policies to meet federal cost principals and requirements. These are currently pending approval by the Board of Directors for implementation.
Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of suspension and debarment. The Loan Fund should have internal controls designed to ensure compliance with this provision. 2 CFR 200.318-200.321 outline requirements to maintain records sufficient to detail the history of procurement, requirements for competition, methods and purchasing thresholds, as well as other requirements for contracting with organizations with using federal funds. The Loan Fund?s policies do not meet these requirements. Condition: During our testing, we noted that the Loan Fund internal controls and accounting policies were not sufficient in regard to federal requirements for procurements and for ensuring vendors and contractors used are not suspended or debarred. Questioned costs: None. The Loan Fund did not enter into any contracts with disallowed parties, and there were no issues with mircopurchases tested. The Loan Fund policies and procedures do not contain necessary controls to ensure compliance with the requirements for suspension and debarment or procurements. As such, they were not sufficient to ensure material compliance with this compliance requirement. Context: See Condition. Cause: Lack of established controls and procedures over requirements for procurements and federal principals for suspension and debarment. Effect: Possible noncompliance with federal requirements for procurements using federal monies. Possibility to enter into a covered transaction with a noneligible contractor or vendor. Recommendation: We recommend that the Loan Fund reviews the current financial policies and procedures in order to better serve the organization in documenting compliance with federal cost principals and requirements. Views of responsible officials: There is no disagreement with the audit finding. Management accepts this finding and has made efforts to review and update our policies to meet federal cost principals and requirements. These are currently pending approval by the Board of Directors for implementation.
Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of suspension and debarment. The Loan Fund should have internal controls designed to ensure compliance with this provision. 2 CFR 200.318-200.321 outline requirements to maintain records sufficient to detail the history of procurement, requirements for competition, methods and purchasing thresholds, as well as other requirements for contracting with organizations with using federal funds. The Loan Fund?s policies do not meet these requirements. Condition: During our testing, we noted that the Loan Fund internal controls and accounting policies were not sufficient in regard to federal requirements for procurements and for ensuring vendors and contractors used are not suspended or debarred. Questioned costs: None. The Loan Fund did not enter into any contracts with disallowed parties, and there were no issues with mircopurchases tested. The Loan Fund policies and procedures do not contain necessary controls to ensure compliance with the requirements for suspension and debarment or procurements. As such, they were not sufficient to ensure material compliance with this compliance requirement. Context: See Condition. Cause: Lack of established controls and procedures over requirements for procurements and federal principals for suspension and debarment. Effect: Possible noncompliance with federal requirements for procurements using federal monies. Possibility to enter into a covered transaction with a noneligible contractor or vendor. Recommendation: We recommend that the Loan Fund reviews the current financial policies and procedures in order to better serve the organization in documenting compliance with federal cost principals and requirements. Views of responsible officials: There is no disagreement with the audit finding. Management accepts this finding and has made efforts to review and update our policies to meet federal cost principals and requirements. These are currently pending approval by the Board of Directors for implementation.
Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of suspension and debarment. The Loan Fund should have internal controls designed to ensure compliance with this provision. 2 CFR 200.318-200.321 outline requirements to maintain records sufficient to detail the history of procurement, requirements for competition, methods and purchasing thresholds, as well as other requirements for contracting with organizations with using federal funds. The Loan Fund?s policies do not meet these requirements. Condition: During our testing, we noted that the Loan Fund internal controls and accounting policies were not sufficient in regard to federal requirements for procurements and for ensuring vendors and contractors used are not suspended or debarred. Questioned costs: None. The Loan Fund did not enter into any contracts with disallowed parties, and there were no issues with mircopurchases tested. The Loan Fund policies and procedures do not contain necessary controls to ensure compliance with the requirements for suspension and debarment or procurements. As such, they were not sufficient to ensure material compliance with this compliance requirement. Context: See Condition. Cause: Lack of established controls and procedures over requirements for procurements and federal principals for suspension and debarment. Effect: Possible noncompliance with federal requirements for procurements using federal monies. Possibility to enter into a covered transaction with a noneligible contractor or vendor. Recommendation: We recommend that the Loan Fund reviews the current financial policies and procedures in order to better serve the organization in documenting compliance with federal cost principals and requirements. Views of responsible officials: There is no disagreement with the audit finding. Management accepts this finding and has made efforts to review and update our policies to meet federal cost principals and requirements. These are currently pending approval by the Board of Directors for implementation.
ALN 21.027 U.S. Department of Treasury Criteria: The U.S. Department of Treasury established procurement requirements for local governments as outlined in sections 602(c) and 603(c) of the Act and Treasury?s Interim Final Rule. These requirements established procurement procedures for Coronavirus State and Local Fiscal Recovery Fund (SLFRF) expenditures to comply with 2 CFR 200.321 ? 200.323. Condition: The County had a project that was subject to procurement requirements but was not competitively bid. Context: During our review of the SLFRF expenditures, we noted the County had $62,752 in expenditures for a broadband improvement project subject to procurement requirements that was not procured in accordance with Uniform Guidance. Effect: $62,752 of expenditures are considered questioned costs due to being paid on a contract that was not in compliance with procurement requirements. Cause: Lack of sufficient internal controls over the procurement requirements of the SLFRF program. Recommendation: We recommend the County enhance its internal controls over procurement to meet the requirements of the SLFRF program by implementing procurement policies and procedures that comply with procurement standards outlined in the Uniform Guidance.
Finding 2022-003: Lack of Documented Procurement Procedures U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES Section 223 Demonstration Programs for Improving Community Mental Health Services – Assistance Listing No. 93.829 Compliance Findings: Procurement and Suspension and Debarment (I) Criteria: The Standard Terms and Conditons for all SAMHSA’s awards requires that grantees comply with Title 2 U.S. Code of Federal Regulation (CFR) section 200.318 through 200.321. In accordance with 2 CFR section 200.320, a non-federal entity must have and use documented procurement procedures, consistent with the standards of 2 CFR section 200.317 through 200.320 for any method of procurement used for the acquisition of property or services required under a federal award or sub-award. Condition: The Organization does not have documented procurement procedures that incorporate all the requirements of 2 CFR section 200.317 through 200.320. Cause: Unknown. Questioned Costs: None. Effect: The Organization is not in compliance with 2 CFR section 200.320 or the terms of the grant agreement. Identification of Repeat Finding: Not a repeat finding. Recommendation: We recommend that the Organization adopt a written procurement policy which includes all requirements of 2 CFR section 200.317 through 200.320. Views of Responsible Officials: The Organization agrees with the finding and will adopt a documented procurement policy consistent with the standards of 2 CFR section 200.317 through 200.320 to use for procurement of the acquisition of property or services required under federal awards or sub-awards. Additional details can be found in the Organization’s Corrective Action Plan.
Finding: Procurement, Suspension and Debarment (Significant Deficiency; Other Matter) Federal Assistance Listing Number 14.862 – Indian Community Development Block Grant Award Number – B-18-SR-40-0584 & B-19-SR-40-0584; Award Year 2018 & 2019 Federal Assistance Listing Number 21.027 – Coronavirus State and Local Fiscal Recovery Funds Award Number – 8L-SS-2021-0901-001; Award Year 2021 Suspension and Debarment Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart C, 200.214 - Recipients and subrecipients are subject to the procurement, debarment and suspension regulations implementing Executive Orders 12549 and 12689, as well as 2 CFR part 180. The regulations in 2 CFR Part 180 restrict making Federal awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from receiving or participating in Federal awards. Procurement Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, 200.321 - When possible, the recipient or subrecipient should ensure there is open competition for non-micro purchases and an equitable distribution among suppliers for micro purchases. Condition: The Tribe was unable to provide supporting documentation showing that a verification had been performed to ensure vendors were not suspended or debarred. Several large purchases were sole sourced without adequate documentation. A high volume of micro purchases were made from the same vendor rather than being distributed equitably amount a variety of vendors. Questioned Costs: None. Context: 14.862 - Three procurements were tested noting two in which suspension and debarment checks were not performed. A high volume of micro purchases ($148,908) were made from the same vendor rather than an equitable distribution of vendors. 21.027 - 14 procurements were tested. Ten procurements tested were subject to suspension and debarment of which checks were not performed on nine. All 14 procurements tested were subject to non-micro purchase requirements. Six procurements were sole sourced without adequate supporting documentation to support this method of purchase. A non-statistical sampling methodology was used to select the samples. Effect: The Tribe's inability to furnish supporting documentation showing that a check to ensure vendors were not suspended or debarred on SAM.gov could result in the use of ineligible vendors. The Tribe's failure to provide for open competition or provide for an equitable distribution of vendors on purchases could result in the Tribe paying more for services than is reasonable or necessary. Cause: Tribal policies were not followed surrounding the requirement of suspension and debarment checks and documentation of sole source procurements. Due to the Tribal location, there may be some limitation of available vendors for consideration to ensure an equitable distribution. Identification as a Repeat Finding: 2021-005 (same issue in different program) Recommendation: We recommend the Department ensure existing procurement, suspension and debarment policies are understood throughout the Tribe and supporting documentation is adequate and maintained for all procurement decisions. Views of Responsible Officials: The Department agrees with the finding. See separate report for planned corrective actions.
Finding: Procurement, Suspension and Debarment (Significant Deficiency; Other Matter) Federal Assistance Listing Number 14.862 – Indian Community Development Block Grant Award Number – B-18-SR-40-0584 & B-19-SR-40-0584; Award Year 2018 & 2019 Federal Assistance Listing Number 21.027 – Coronavirus State and Local Fiscal Recovery Funds Award Number – 8L-SS-2021-0901-001; Award Year 2021 Suspension and Debarment Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart C, 200.214 - Recipients and subrecipients are subject to the procurement, debarment and suspension regulations implementing Executive Orders 12549 and 12689, as well as 2 CFR part 180. The regulations in 2 CFR Part 180 restrict making Federal awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from receiving or participating in Federal awards. Procurement Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, 200.321 - When possible, the recipient or subrecipient should ensure there is open competition for non-micro purchases and an equitable distribution among suppliers for micro purchases. Condition: The Tribe was unable to provide supporting documentation showing that a verification had been performed to ensure vendors were not suspended or debarred. Several large purchases were sole sourced without adequate documentation. A high volume of micro purchases were made from the same vendor rather than being distributed equitably amount a variety of vendors. Questioned Costs: None. Context: 14.862 - Three procurements were tested noting two in which suspension and debarment checks were not performed. A high volume of micro purchases ($148,908) were made from the same vendor rather than an equitable distribution of vendors. 21.027 - 14 procurements were tested. Ten procurements tested were subject to suspension and debarment of which checks were not performed on nine. All 14 procurements tested were subject to non-micro purchase requirements. Six procurements were sole sourced without adequate supporting documentation to support this method of purchase. A non-statistical sampling methodology was used to select the samples. Effect: The Tribe's inability to furnish supporting documentation showing that a check to ensure vendors were not suspended or debarred on SAM.gov could result in the use of ineligible vendors. The Tribe's failure to provide for open competition or provide for an equitable distribution of vendors on purchases could result in the Tribe paying more for services than is reasonable or necessary. Cause: Tribal policies were not followed surrounding the requirement of suspension and debarment checks and documentation of sole source procurements. Due to the Tribal location, there may be some limitation of available vendors for consideration to ensure an equitable distribution. Identification as a Repeat Finding: 2021-005 (same issue in different program) Recommendation: We recommend the Department ensure existing procurement, suspension and debarment policies are understood throughout the Tribe and supporting documentation is adequate and maintained for all procurement decisions. Views of Responsible Officials: The Department agrees with the finding. See separate report for planned corrective actions.
Finding: Procurement, Suspension and Debarment (Significant Deficiency; Other Matter) Federal Assistance Listing Number 14.862 – Indian Community Development Block Grant Award Number – B-18-SR-40-0584 & B-19-SR-40-0584; Award Year 2018 & 2019 Federal Assistance Listing Number 21.027 – Coronavirus State and Local Fiscal Recovery Funds Award Number – 8L-SS-2021-0901-001; Award Year 2021 Suspension and Debarment Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart C, 200.214 - Recipients and subrecipients are subject to the procurement, debarment and suspension regulations implementing Executive Orders 12549 and 12689, as well as 2 CFR part 180. The regulations in 2 CFR Part 180 restrict making Federal awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from receiving or participating in Federal awards. Procurement Criteria or Specific Requirement: According to 2 CFR Part 200, Subpart D, 200.321 - When possible, the recipient or subrecipient should ensure there is open competition for non-micro purchases and an equitable distribution among suppliers for micro purchases. Condition: The Tribe was unable to provide supporting documentation showing that a verification had been performed to ensure vendors were not suspended or debarred. Several large purchases were sole sourced without adequate documentation. A high volume of micro purchases were made from the same vendor rather than being distributed equitably amount a variety of vendors. Questioned Costs: None. Context: 14.862 - Three procurements were tested noting two in which suspension and debarment checks were not performed. A high volume of micro purchases ($148,908) were made from the same vendor rather than an equitable distribution of vendors. 21.027 - 14 procurements were tested. Ten procurements tested were subject to suspension and debarment of which checks were not performed on nine. All 14 procurements tested were subject to non-micro purchase requirements. Six procurements were sole sourced without adequate supporting documentation to support this method of purchase. A non-statistical sampling methodology was used to select the samples. Effect: The Tribe's inability to furnish supporting documentation showing that a check to ensure vendors were not suspended or debarred on SAM.gov could result in the use of ineligible vendors. The Tribe's failure to provide for open competition or provide for an equitable distribution of vendors on purchases could result in the Tribe paying more for services than is reasonable or necessary. Cause: Tribal policies were not followed surrounding the requirement of suspension and debarment checks and documentation of sole source procurements. Due to the Tribal location, there may be some limitation of available vendors for consideration to ensure an equitable distribution. Identification as a Repeat Finding: 2021-005 (same issue in different program) Recommendation: We recommend the Department ensure existing procurement, suspension and debarment policies are understood throughout the Tribe and supporting documentation is adequate and maintained for all procurement decisions. Views of Responsible Officials: The Department agrees with the finding. See separate report for planned corrective actions.