Finding Text
Finding Reference Number: SA2023-001 – Suspension and Debarment for Contracts and
Subcontracts
Assistance Listing Numbers: 21.027
Assistance Listing Title: COVID-19 – Coronavirus State and Local Fiscal Recovery Funds
Name of Federal Agency: Department of Treasury
Pass Through Entity: California State Water Resources Control Board
Federal Award Identification Number: SLFRP4371 – 266737
Criteria: The Award Terms and Conditions in the City of Turlock’s (the City) Coronavirus Local Fiscal
Recovery Funds Agreement with the U.S. Department of the Treasury requires that the City comply with
Office of Management and Budget (OMB) Guidelines to Agencies on Governmentwide Debarment and
Suspension (Nonprocurement), 2 CFR Part 180, including the requirement to include a term or condition
in all lower tier covered transactions (contracts and subcontracts described in 2 CFR Part 180, subpart B)
that the award is subject to 2 CFR Part 180 and Treasury’s implementing regulation at 31 CFR Part 19. In
addition, the OMB Compliance Supplement requires that prior to entering into subawards and contracts
with award funds, recipients must verify that such contractors and subrecipients are not suspended,
debarred, or otherwise excluded pursuant to 31 CFR section 19.300.
Condition: During the 2021 audit, the auditor selected 19 transactions for testing that included six
different vendors where the City did not verify that the vendors were not suspended, debarred, or
otherwise excluded prior to entering into the agreements. The auditor verified that City staff determined
that as of April 8, 2024, none of the six vendors were on the exclusions list on SAM.gov. The City
subsequently has drafted an updated citywide procurement policy that includes the requirement to be
compliant with 2 C.F.R Part 180 and was expected to be approved in March 2024 as part of the City’s
corrective action plan. In conjunction with the updated procurement policy, the purchasing department of
the City will check for suspension and debarment for contracts and subcontracts as part of the request for
proposal process and notify all departments to check vendors when utilizing Federal funds. However, the
updated citywide procurement policy has not been approved as of January 29, 2025.
Cause: The delay in approving the updated citywide procurement policy was due to staff turnover issues.
Identification as a Repeat Finding: Yes, since 2021.
Effect: The City is not in compliance with the grant Award Terms and Conditions.
Recommendation: The City should approve and implement the updated citywide procurement policy in
accordance with the corrective action plan.
View of Responsible Officials and Planned Corrective Actions: Please see Corrective Action Plan
separately prepared by the City.