Federal Program Information:
Funding Agency: U.S. Department of Agriculture
Title: USDA School Breakfast Program and National School Lunch
Program
FAL Number: 10.553 and 10.555
Passthrough: New Mexico Public Education Department Award Year:
2022
Criteria:
§200.213 Suspension and debarment.
Non-federal entities are subject to the non-procurement debarment and suspension regulations
implementing Executive Orders 12549 and 12689, 2 CFR part 180. These regulations restrict awards,
sub awards, and contracts with certain parties that are debarred, suspended, or otherwise excluded
from or ineligible for participation in Federal assistance programs or activities.
§200.317 Procurements by states.
When procuring property and services under a Federal award, a state must follow the same policies
and procedures it uses for procurements from its non-Federal funds. The state will comply with
§200.322 Procurement of recovered materials and ensure that every purchase order or other contract
includes any clauses required by section §200.326 Contract provisions. All other non-Federal
entities, including sub recipients of a state, will follow §200.318 General procurement standards
through 200.326 Contract provisions.
§200.318 General procurement standards.
(a) The non-Federal entity must use its own documented procurement procedures which reflect
applicable State, local, and tribal laws and regulations, provided that the procurements conform to
applicable Federal law and the standards identified in this part.
(b) Non-Federal entities must maintain oversight to ensure that contractors perform in accordance
with the terms, conditions, and specifications of their contracts or purchase orders.
APPENDIX II TO PART 200—CONTRACT PROVISIONS FOR NON-FEDERAL ENTITY CONTRACTS UNDER FEDERAL AWARDS
In addition to other provisions required by the Federal agency or non-Federal entity, all contracts
made by the non-Federal entity under the Federal award must contain provisions covering the
following, as applicable.
(H) Debarment and Suspension (Executive Orders 12549 and 12689)—A contract award (see 2 CFR
180.220) must not be made to parties listed on the government-wide exclusions in the System for
Award Management (SAM), in accordance with the OMB guidelines at 2 CFR 180 that implement Executive Orders 12549 (3 CFR part 1986 Comp., p. 189) and 12689 (3 CFR part 1989 Comp., p. 235), “Debarment and Suspension.” https://www.sam.gov/portal/public/SAM/ SAM Exclusions contains the names of parties debarred, suspended, or otherwise excluded by agencies, as well as parties declared ineligible under statutory or regulatory authority other than Executive Order 12549.
Condition: During our testing of single audit disbursements, we identified five vendors which would meet the requirement of verifying that the vendor was not suspended or debarred or
otherwise excluded from receiving the contract which was funded through Federal dollars. The vendor
received single payments in excess of $25,000 from the District from Federal grant sources. The
vendors are not currently suspended or debarred from receiving Federal contracts; however, the
District did not have proper internal controls in place to verify this prior to the purchase.
Questioned Costs: None
Cause: District personnel did not verify that vendors which meet the $25,000 thresholds are not
suspended, debarred, or otherwise excluded from participating in contracts funded through Federal
awards due to a misunderstanding of staff personnel regarding this requirement.
Effect: The District is not in compliance with Federal regulations related to the grant and could
put funding in jeopardy or require the District to reimburse the program for improper grant distributions.Auditor’s Recommendation: We recommend the District establish a policy and implement procedures
regarding large purchases related to Federal grants to insure that no vendors who are suspended,
debarred, or otherwise excluded from participating in transactions funded through Federal grants
are used. As identified above, there are several methods in which the District can verify vendors
are not suspended or debarred. The District may have the vendor provide an annual certification
that it is not currently suspended, debarred, or otherwise prevented from receiving Federal
dollars. In other occasions in which a single purchase is going to be made, the purchasing
procedures should include looking up the vendor on the GSA website, printing a copy of the
verification, and placing it in the file with the purchase order. The District has options, and it
should establish what method is the least intrusive but also effective in complying with the
requirements of the Uniform Grant Guidance.
Responsible Official’s Plan:
• Specific corrective action plan for finding:
The Grants Finance Department, Purchasing Department along with the Federal Grants
Department will review vendors that are issued requisitions at each approval level to
assist in catching $25K or more for Suspension and Debarment. A printed document from
SAM.GOV verifying eligibility to Requisitions over $25K should be attached.
At initial setup of new vendors, the Purchasing Department will review vendors in SAM.GOV. A
printed document from SAM.GOV verifying eligibility of vendor will be attached to the vendor file.
• Timeline for completion of corrective action plan:
July 1, 2023
• Employee position(s) responsible for meeting the timeline:
Grants Specialists, CPO, Finance Specialist, Purchasing Specialist, Federal Grants
Coordinator, Federal Grants Specialist