Finding Text
Finding No.: 2012-016
Federal Agency: U.S. Department of Education
Federal Award No.: COVID-19 P425E204126
AL Sub-Program: 84.425F HEERF - Institutional Portion
Federal Award No.: COVID-19 P425F202732
AL Sub-Program: 84.425L HEERF - Minority Serving Institution
Federal Award No.: COVID-19 P425L200219
Area: Procurement and Suspension and Debarment
Questioned Costs: $192,795
Criteria: Under the terms of the sub-awards administered by RepMar under the Compact of Free Association grant awards, RepMar authorizes the College to use its own procedures for procurement provided they meet the RepMar Procurement Code.
RepMar’s Procurement Code states the following:
(a) Section 126.7 - Award shall be made to the responsible offeror whose proposal is determined in writing to be the most advantageous to the Government taking into consideration price and the evaluation factors set forth in the Request for Proposals. No other factors or criteria shall be used in the evaluation. The contract file shall contain the basis on which the award is made.
(b) Section 127 - Procurement of goods and services not exceeding $25,000 may be made in accordance with small purchase procedures promulgated by RepMar’s Policy Office. Small purchase procedures are those relatively simple and informal methods for securing services, supplies, or other property that do not cost more than $25,000. RepMar’s Ministry of Finance has previously declared that if small purchase procedures are used, price or rate quotations shall be obtained from an adequate number of qualified sources.
(c) Section 128 - a contract may be awarded for supply, service, or construction item without competition when it is determined in writing that there is only one source for the required supply, service, or construction item.
(d) Section 129 - Notwithstanding any other provision of this Chapter, the Chief Procurement Officer, the head of a Purchasing Agency, or a designee of either officer may make or authorize others to make emergency procurement when there exists a threat to public health, welfare, or safety under emergency conditions as defined in regulations promulgated by the Policy Office; provided, that such emergency procurement shall be made with such competition as is practicable under the circumstances.
Condition: Of eight items, aggregating $268,560 of $700,377 in total non-payroll expenditures, deficiencies were noted, as follows:
1. For 4 items (or 50%), procurement was not supported by competitive sealed bid or another appropriate procurement methodology; thus, the following purchases either appear to have been sole sourced without written justification or sole sourced with written justification but does not appear to be justified:
No questioned cost is reported at this finding for item # 4 as questioned cost is reported at finding # 2021-015.
2. For 3 items (or 38%), supporting procurement documentation was not sufficient to substantiate compliance with small purchase procedures:
For item # 6, there were no vendor quotations on file. Moreover, for item #s 5 and 7, selected vendor is not the lowest bidder and no justification of vendor selection was on file.
Cause: The College did not follow internal control policies and procedures over documentation of the procurement process to satisfy compliance with applicable procurement requirements.
Effect: The College is in noncompliance with applicable procurement requirements. The total questioned cost is $251,250, of which $58,455 is reported at finding # 2021-015.
Recommendation: Responsible personnel should ensure that documentation be adequate to comply with applicable procurement requirements. Specifically, documentation should indicate the history of procurement, including the solicitation process and rationale for contractors or vendor selection.
Views of Auditee and Corrective Action Plan: The College partially agrees with the finding and provides details in its Corrective Action Plan.