Finding 1106279 (2024-002)

Finding 2024-002 Program Affected AL 93.696 Certified Community Behavioral Health Clinics – Agreement period September 30, 2022 through September 29, 2024 Criteria 2 CFR 180.300 details the requirement when, “entering a covered transaction with another person at the next lower tier, they must verify that the person with whom they intend to do business is not excluded or disqualified. This is done by (a) checking SAM exclusions; or (b) collecting a certification from that person; or (c) adding a clause or condition to the covered transaction with that person.” Condition and Context We were unable to test for compliance with the requirements of 2 CFR 180.300 for verifying a vendor is not excluded or disqualified from doing business with an entity that receives federal funds, as there was no auditable evidence of the contractors being verified for exclusion through suspension or debarment. Questioned Costs None. Cause and Effect The Agency currently lacks a formal policy to review vendors against the SAM exclusion list, collecting a formal certification from the vendor or adding a clause to the covered transaction with the vendor. Without a formal policy addressing the process of suspension and debarment check, there is risk of working with a suspended or debarred entity resulting in non-prudent use of federal funds. Recommendation We recommend implementing a formal process when entering arrangements with external parties to check they are not suspended or debarred on the SAM Exclusions list. Views of Responsible Officials and Corrective Action Plan Management agrees with the finding. See attached Corrective Action Plan.