Finding Text
CONDITION: The Northern Cambria School District contracted Eber HVAC, Inc. for the School District’s RTU Replacement Project which constitutes a construction-related purchase which requires prior approval from the Pennsylvania Department of Education (PDE). The School District did not obtain the required prior approval from PDE for this expenditure. This is a repeat finding (2023-001) from the prior fiscal year
CRITERIA: PDE and Section 2 CFR 200.439(b) of the Uniform Guidance require prior written approval by the federal or pass-through awarding agency for capital purchases including equipment, buildings, and land. Capital expenditures for special purpose equipment with a unit cost of $5,000 or more must also have prior approval.
CAUSE: School District personnel did not review the PDE and Uniform Guidance requirements for capital purchases in advance of contracting for the RTU Replacement Project.
EFFECT: The Northern Cambria School District did not comply with the requirements of PDE and 2 CFR 200.439(b) of the Uniform Guidance regarding obtaining prior written approval for capital expenditures.
QUESTIONED COST: $818,900
RECOMMENDATION: For all future capital expenditures utilizing federal grant funding, I am recommending that the School District properly complete the necessary PDE, or other awarding agency forms, necessary to receive prior written approval for capital expenditures in accordance with PDE and Section 2 CFR 200.439(b) of the Uniform Guidance regulations.
VIEWS OF RESPONSIBLE OFFICIALS: Management of the School District has reviewed the above noted finding and recommendation and has developed a corresponding ‘Corrective Action Plan’ to address this matter (See Corrective Action Plan).