Finding Text
Finding 2023-001: Procurement Policy and Related Contract
Program: 66.958 Water Infrastructure Finance and Innovation
Federal Agency: U.S. Environmental Protection Agency
Award No: WIFIA-N18147WI
Award Year: 2023
This finding is a repeat finding of 2022-001
Criteria: 2 CFR section 200.318 - General Procurement Standards, requires non-Federal entities to have and use documented procurement procedures, consistent with State, local and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in §§ 200.317 through 200.327.
Condition: We reviewed the water utility's procurement policy and service contracts with costs reimbursed during 2023, noting they did not contain necessary federal language related to conflicts of interest and debarment and suspension.
Cause: The water utility has not received federal funding in the past and did not update their procurement policy when they sought federal funding for the Great Lakes Water Supply project. Additionally, service contracts were entered into prior to receiving federal funds.
Effect: Without adequate control of contract language the water utility could enter into contracts related to the Great Lakes Water Supply project that do not qualify for federal reimbursement.
Questioned Costs: None noted.
Recommendation: We recommend the water utility review its procurement policy and make necessary updates to be in compliance with federal standards. Additionally, we recommend the utility enter into contract addendums related to contracts previously executed without required federal language.
Management Response: Waukesha Water utility management has worked closely with WIFIA to craft contracts that include all necessary language prior to releasing RFPs for construction contracts. WIFIA was presented all service contracts to review prior to reimbursements received in fiscal year 2023. The finance department is working to update the procurement policy to ensure necessary federal language is included. The finance department will also work with service contractors to execute contract addendums.