Finding Text
Finding 2024-005 – Inadequate Procurement Documentation (Material Weakness) Name of Federal Agency: U.S. Environmental Protection Agency Federal Program Name: Nonpoint Source Implementation Grants Assistance Listing Numbers: 66.460 Pass-Through Entity: Oregon Department of Environmental Quality Name of Federal Agency: U.S. Department of Commerce – National Oceanic and Atmospheric Administration Federal Program Name: Pacific Coast Salmon Recovery Program Assistance Listing Numbers: 11.438, 15.015, 15.244 Pass-Through Entity: State of Oregon – Oregon Watershed Enhancement Board (OWEB) Name of Federal Agency: U.S. Department of Agriculture Federal Program Name: National Fish and Wildlife Foundation Assistance Listing Numbers: 10.665 Pass-Through Entity: U.S. Forest Service Name of Federal Agency: U.S. Department of Agriculture Federal Program Name: Natural Resources Conservation Service Assistance Listing Numbers: 10.905 Pass-Through Entity: U.S. Forest Service Name of Federal Agency: U.S. Department of the Interior Federal Program Name: Wildlife, Sport Fish and Restoration Program Assistance Listing Numbers: 15.244 Pass-Through Entity: Bureau of Land Management Name of Federal Agency: U.S. Department of the InteriorFederal Program Name: Secure Rural Schools and community Self-Determination – Watershed and water-quality improvements Assistance Listing Numbers: 15.234 Pass-Through Entity: Bureau of Land Management Criteria: Federal procurement standards require non-Federal entities to maintain records sufficient to detail the history of procurement, including the method of procurement, selection of contract type, contractor selection or rejection, and basis for the contract price. Competitive procurement must follow the entity’s written procedures consistent with 2 CFR §§200.317-200.327, including: Written procedures for procurement (§200.318(a)). Full and open competition requirements (§200.319). Methods of procurement (sealed bids, proposal requirements, and required documentation (§200.320). Contract cost and price justification, (§200.324). Suspension/debarment verification for covered transactions (§200.214; §200.213). Condition: During the audit period, the Entity did not retain sufficient procurement documentation for several contracts funded under the above Assistance Listings. Specifically, files lacked one or more of the following: Evidence of the procurement method used. Price or cost analysis. Suspension/debarment checks for vendors where required. Documentation of competition. Conflict-of-interest attestations. Cause: Partnership for the Umpqua Rivers procurement procedures were not sufficiently detailed or consistently applied to federal purchases. No evidence of procedures or review for procurement or suspension / debarment was provided to auditors. Turnover and limited training on Uniform Guidance procurement standards contributed to the inconsistent file completeness. Effect or Potential Effect: Without complete procurement documentation, the Entity cannot demonstrate compliance with federal procurement requirements, increasing the risk of: Noncompetitive awards or unreasonable prices. Unallowable costs for the award requirements. Potential disallowance or repayment of federal funds. Findings in federal or pass-through monitoring and future audits. Questioned Cost: Yes, $902,496 related to expenditures that had no procurement support or detail. Context: During our audit, it was found that the Partnership for the Umpqua Rivers had experienced complete staff turnover in Financial Management for the year being audited. No current finance employees had worked for the organization during the year being audited. Award files provided to auditors did not contain information related to procurement, suspension or debarment procedures or processes. Repeat of a Prior-Year Finding: No, Prior- year did not require a Single Audit. Recommendation: We recommend that Partnership for the Umpqua Rivers: Update Written Procurement Procedures o Incorporate Uniform Guidance thresholds and methods (§200.320), competition requirements (§200.319), and documentation expectations (history of procurement). o Embed steps for suspension / debarment checks and Appendix II Contract clauses. Standardized Procurement Checklist o Pre-award checklist that verifies: method, competition evidence, cost/price analysis, conflict of interest attestations, SAM exclusion check, and required federal clauses. o Post -award checklist ensuring complete contract file (award memo, bid tab / evaluation, signed agreement, clause verification). Cost/Price Analysis Guidance o Require documented price reasonableness for small purchases, formal cost or price analysis for larger or sole-source awards, per (§200.324). Training & Accountability o Provide targeted training to procurement and program staff on 2 CFR §§200.317- 20.327 and Assistance Listing award conditions. o Implement supervisory pre-award review and periodic file audits. District Response: Partnership for the Umpqua Rivers acknowledges the deficiencies. Corrective Action Plan: ____________ (To be completed by Partnership for the Umpqua Rivers) Planned Implementation Date: _____________ Responsible Person: Partnership for the Umpqua Rivers Finance Manager