Finding 1174197 (2024-002)

Federal Agency: U.S. Department of Treasury Federal Programs: COVID-19 Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Pass-Through Agency: State Department of Revenue Pass-Through Number(s): Not Available Award Period: July 1, 2023 – June 30, 2024 Compliance Requirement: Procurement, Suspension and Debarment Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or Specific Requirement: The Code of Federal Regulations (CFR) Title 2 Part 200.214 states that nonfederal entities are subject to the nonprocurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. These regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Nonfederal entities must verify that contracts with certain parties are not debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: The Town did not document verification that certain vendors were not suspended or debarred from participation in Federal assistance programs or activities. The vendors in our audit sample were not suspended or debarred. Context: The condition above occurred for four vendors in our audit sample. Questioned Costs: None. Cause: Procedures were not in place to document the verification that all vendors were not suspended or debarred from participation in Federal assistance programs or activities. Effect: Lack of verification of vendors’ debarment or suspension status could cause federal grant funds to be expended with vendors that are excluded from participation in Federal assistance programs or activities. Repeat Finding: No Recommendation: We recommend to annually (at a minimum) document the verification that all vendors are not suspended or debarred from participation in Federal assistance programs or activities. Views of Responsible Officials: Management agrees with the finding.