Finding 10632 (2022-001)

Significant Deficiency
Requirement
I
Questioned Costs
-
Year
2022
Accepted
2024-01-29

AI Summary

  • Core Issue: MINA failed to document compliance with sole source procurement regulations for all contractors tested.
  • Impacted Requirements: Lack of written justification for unique capabilities, competition efforts, and considerations of alternative sources.
  • Recommended Follow-up: MINA should adhere to procurement regulations and ensure proper documentation is created and maintained.

Finding Text

Criteria: The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. CNMI Department of Finance Procurement regulations § 70-30.3-225, sole source procurement indicates: for any sole-source procurement pursuant to subsection (a)(1), a written justification for sole-source procurement shall be prepared by the official with expenditure authority and submitted to the Director. This written justification shall contain the specific unique capabilities required; the specific unique capabilities of the contractor; the efforts made to obtain competition; and the specific considerations given to alternative sources and specific reasons why alternative sources were not selected. Condition: For 3 or 100% of the 3 contractors selected for testing, MINA did not properly document their compliance with the sole source procurement regulation. There was no written justification regarding the specific unique capabilities required from the contractors, also the efforts made to obtain competition, and the specific considerations given to alternative sources. Cause: MINA did search for contractors in the CNMI and made their determination that there were no alternative sources, but they did not document these procedures. Effect: The possibility exists that the Organization may not have obtained the best combination of service and cost. Recommendation: MINA should establish, monitor and follow the existing procurement regulations, or develop its own procurement regulations that will be in accordance with local laws and regulations. MINA should ensure that required written documentation evidencing compliance is prepared and maintained. Views of Responsible Officials: MINA has agreed with the finding. See the details at the corrective action plan.

Corrective Action Plan

As per the CNMI Department of Finance Procurement regulations 70-30.3-225, sole source procurement indicates that a written justification shall be prepared by the official with expenditure authority. In this instance, the selection process of the three contractors chosen was based on quotations for the required services in face-to-face meetings, and the knowledge that these were the sole qualified local contractors with highly specialized and technical expertise to fulfill the scope of the project in preventing further damage to endangered species corals from typhoon-related marine debris. There was an admitted failure to document the procedure undertaken to retain these contractors’ services, and corrective measures have since been put in place, with completion date of corrective action effective December 31, 2023 for the ongoing remainder of the project period, as well as all future federal grants as follows: a. Requests for Proposals will be published in local media with following detail:  Project title and overview  Scope of Work  Proposal Requirements  Submission Deadline and Contact Information  Evaluation and Selections  Contractual information b. The selection criteria are based on the Proposal Evaluation Form, attached herewith. MINA Proposal Evaluation Form Proposal Information:  RFP Release Date:  Proposal Submission Deadline  Proposal Submitted By:  Title:  Proposal Number:  Evaluator Name:  Criteria for Evaluation: Scoring System: 1: Poor, 2: Below Average, 3: Average, 4: Above Average, 5: Excellent 1. Compliance with RFP Requirements Score:  Proposal conforms to the RFP instructions and guidelines.  All required documentation and attachments are included.  Proposal was submitted before the deadline. 2. Understanding of Requirements Score:  Demonstrated understanding of the project's scope and objectives.  Clear articulation of how the proposal meets the needs outlined in the RFP. 3. Technical Approach Score:  Clarity and feasibility of the proposed technical approach.  Innovation and creativity in addressing project challenges. 4. Qualifications and Experience Score:  Relevant qualifications and expertise of the proposing organization.  Past experience on similar projects. 5. Cost and Budget Score:  Cost breakdown and justification.  Alignment of proposed budget with the project's scope. 6. References and Client Feedback Score:  Provided references and feedback from previous clients. 7. Timeline and Milestones Score:  Realistic project timeline and milestones.  Clearly defined project phases. 8. Risk Assessment and Mitigation Score:  Identification of potential risks and a plan for risk mitigation. 9. Quality Control and Assurance Score:  Explanation of quality control measures to ensure project qualityOverall Assessment:  Total Score: Summary and Recommendations: Evaluation completed by: Print name and sign Date Sole Source Procurement Policy December 12, 2023 Marana Islands Nature Alliance (MINA), as a non-Federal entity, and pursuant to CNMI Department of Finance Procurement regulations section 70-30.3-225, has established the following sole source procurement procedures for the acquisition of property or services required under a Federal award or subaward: 1. A contract may be awarded for a supply, service, or construction without competition when the Executive Director of MINA or his or her designee determines in writing that there is only one source for the required supply, service or construction item. This section shall be construed to include the purpose of obtaining professional services in highly specialized or technical expertise in compliance with federal regulations and whenever so required by any federal granting agencies or grant requirements. 2. The written determination shall state the unique capabilities required and why they are required and the consideration given to alternative sources. The written determination shall contain the specific unique capabilities required; the specific unique capabilities of the contractor; the availability of funding for such services as certified by the MINA accountant; and a written copy of any applicable federal grant or regulation under which the services are authorized or required. Approved by: Roberta Guerrero

Categories

Procurement, Suspension & Debarment Subrecipient Monitoring

Other Findings in this Audit

  • 587074 2022-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
11.999 Marine Debris Program $701,061
15.875 Economic, Social, and Political Development of the Territories $96,850
21.027 Coronavirus State and Local Fiscal Recovery Funds $53,798
11.482 Coral Reef Conservation Program $20,708
11.452 Monofilament Project II $3,460