Finding Text
Procurement Procedures
• Federal Program: Public and Indian Housing, FALN No. 14.850 and Public Housing Capital Fund, FALN No. 14.872
• Criteria: Housing Authorities are required to follow a written procurement policy to provide full and open competition. The Authority has not adopted a customized procurement plan but rather defaults to HUD Handbook 7460.8 REV2, dated 2/2007. The handbook states that the Authority must solicit price quotes from an adequate number of qualified sources (generally defined as not less than three) for purchases exceeding the micro purchase limit ($2,000) but less than the sealed bid threshold of $100,000. In situations where the multiple price quotes are not available, the Authority should document its justification for awarding the contract.
• Condition: Several instances of smaller contracts were executed without documented bids or quotes nor were noncompetitive proposals properly documented. We noted disbursements totaling $266,715 without proper solicitation and/or documentation of procurement action which we consider to be questioned costs.
• Effect: Full and open competition may not have been provided and the lack of sufficient quotes may provide an environment where the contract price may not be reflective of the open market.
Recommendation: The Authority should establish procedures to solicit enough price quotes. In a situation where an adequate number of price quotes cannot be obtained, the Authority should document their conclusion as to why the contract should be approved and perform a cost analysis to ensure the costs are.
• reasonable. The Authority should consider soliciting quotes on an annual basis for certain repeated contracts (unit painting, unit turnovers, etc.) to help alleviate the documentation burden.
• Views of Responsible Officials and Planned Corrective Actions: We have a limited number of competent contractors working in our area but will attempt to obtain more price quotes. In cases where we do not receive an adequate number of price quotes, we will document our reason for awarding the contract and document the cost analysis to determine reasonableness of the costs. We began documenting this procurement at near the end of year, March 31, 2024.