Finding 1160190 (2024-016)

Material Weakness Repeat Finding
Requirement
I
Questioned Costs
-
Year
2024
Accepted
2025-10-08
Audit: 370560
Organization: Town of Jonesboro (LA)

AI Summary

  • Core Issue: The Town did not include necessary provisions for the Build America, Buy America Act (BABA) in its procurement policies.
  • Impacted Requirements: BABA mandates that all materials for federally funded projects must be produced in the U.S., which the Town failed to document or enforce.
  • Recommended Follow-Up: Revise procurement policies to incorporate BABA requirements and train staff to ensure compliance.

Finding Text

2024-016 Noncompliance with Build America, Buy America Act (BABA) Requirements Grantor Environmental Protection Agency – Assistance Listing 66.458 Clear Water State Revolving Fund Passed through Louisiana Department of Environmental Quality – Number CS-221732.01 Grant Period – Year ended June 30, 2024 First reported 2024 Type Material Weakness, Noncompliance Condition The Town failed to include any provisions or policies related to the Build America, Buy America Act (BABA) in their procurement policies. Additionally, the Town did not document any procedures performed to ensure compliance with BABA requirements for federally funded infrastructure projects. Criteria The BABA Act requires that all iron, steel, manufactured products, and construction materials used in federally funded infrastructure projects be produced in the United States. These requirements must be incorporated into the terms and conditions of each award with an infrastructure project. Cause The Town did not update its procurement policies and procedures to reflect the requirements of the BABA Act, possibly due to a lack of awareness or understanding of the new regulations. Effect The absence of BABA-related policies and procedures could result in noncompliance with federal requirements, potentially leading to the use of non-domestic materials in infrastructure projects and jeopardizing federal funding. Questioned Costs None Recommendation It is recommended that the Town revise its procurement policies to include the requirements of the BABA Act. This should involve developing and documenting procedures to ensure that all materials used in federally funded infrastructure projects comply with BABA requirements. Training should also be provided to relevant staff to ensure understanding and compliance with these requirements. Management Response See management’s corrective action plan.

Corrective Action Plan

The Town of Jonesboro respectfully disagrees with the characterization of this finding. While the Build America, Buy America Act (BABA) has been in effect since November 2021, the Town has not received any prior audit findings or notices of noncompliance related to BABA in previous grant cycles or during past administrations. To date, there has been no formal 113 notification or technical assistance provided by federal or state agencies to guide the Town in implementing these requirements in its procurement policies. Nevertheless, the Town fully understands the intent and importance of the BABA provisions, which aim to promote domestic manufacturing and ensure compliance in the use of materials for federally funded infrastructure projects. In light of this finding, the Town will take the following corrective actions: 1. Policy and Procedure Updates: The Town will revise its existing procurement policies to explicitly include compliance requirements for the Build America, Buy America Act, including the use of U.S.-produced iron, steel, manufactured products, and construction materials in all federally funded infrastructure projects. 2. Training and Awareness: Staff involved in procurement, grant administration, and capital infrastructure will undergo appropriate training to ensure a clear understanding of BABA regulations and documentation requirements. The Town will also coordinate with the Louisiana Department of Environmental Quality and the Environmental Protection Agency to obtain relevant training materials and compliance tools. 3. Future Audit Integration: Although the Town has not previously received findings related to BABA, this issue will now be incorporated into internal compliance checklists and future audit procedures to ensure consistent adherence going forward. The Town of Jonesboro is committed to full compliance with federal funding regulations and will implement all necessary improvements to ensure that future federally funded projects align with BABA requirements.

Categories

Procurement, Suspension & Debarment Material Weakness Special Tests & Provisions

Other Findings in this Audit

  • 1160188 2024-014
    Material Weakness Repeat
  • 1160189 2024-015
    Material Weakness Repeat
  • 1160191 2024-017
    Material Weakness Repeat
  • 1160192 2024-018
    Material Weakness Repeat
  • 1160193 2024-019
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
66.458 Clean Water State Revolving Fund $304,399
21.027 Coronavirus State and Local Fiscal Recovery Funds $105,671
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $47,047
20.106 Airport Improvement Program, Infrastructure Investment and Jobs Act Programs, and Covid-19 Airports Programs $25,761
90.200 Delta Regional Authority $23,060