Finding Text
Identification of the Federal Program:
Assistance Listing Number: 20.507
Assistance Listing Title: Federal Transit Cluster
Federal Agency: U.S. Department of Transportation
Federal Award Identification Number: 1650-2020-2; CA-2021-115-00; CA-2022-135-00; CA-2023-034-00; CA-2023-167-0
Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Prior to entering into subawards and contracts with award funds, recipients must ensure that contractors and subcontractors are not suspended from participating in federally funded projects. Verification is typically done by reviewing the System for Award Management (“SAM”) database and including certifications in contacts.
Condition: During the audit over suspension and debarment, we noted that there was no documentation on whether the vendors were checked against the SAM database or obtained required certifications before contract awards.
Cause: Also, there is no formal policies or procedures on the verification of the suspension and debarment status of vendors before entering into a contract. There was no support for 4 out of 4 Federal Transit Cluster vendors selected for testing to show suspension and debarment check was performed prior to contracting.
Effect or Potential Effect: Without verifying whether vendors are suspended or debarred from working on federally-funded projects prior to the contract being awarded, the City could be contracting with vendors that are prohibited from working on federally funded projects and incurring potentially disallowed costs.
Questioned Costs: None noted.
Context: See condition above for the context of the procurement finding.
Identification as a Repeat Finding, If Applicable: Not applicable.
Recommendation: We recommended the City update its purchasing policies and related procedures and to follow the new policies and procedures to be in compliance with Uniform Guidance related to procurement, suspension and debarment and improve its documentation on RFQ evaluation and suspension and debarment check.
Views of Responsible Officials: The City of Commerce will ensure, before contracting, that none of its vendors are suspended, debarred, ineligible, or voluntarily excluded from participating in federally assisted transactions or procurements. To accomplish this, the City of Commerce will verify that the vendors are not excluded or disqualified by checking SAM exclusions (at SAM.gov), collecting a certification, or adding a clause or condition to the covered transaction. As a best practice, the City of Commerce will print the screen with the search results to include in the award or procurement file or to have a checklist noting when the SAM.gov was reviewed. If the City of Commerce becomes aware after the vendor award that an excluded party is participating in a covered transaction, the City shall promptly inform the FTA regional office in writing of this information.