Finding Text
Finding 2025‐007 Procurement and Suspension and Debarment Information on the federal program: Federal awarding agency: United States Department of Education (ED) Federal program: School Safely National Activities, Assistance Listing No. 84.184X Award year: 2024‐2025 Criteria or specific requirement (including statutory, regulatory or other citation): 2 CFR 200.303 requires that a non-federal entity must (a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In accordance with 2 CFR part 180 non-federal entities are prohibited from contracting with, or making subawards to parties that are suspended or debarred, or otherwise excluded. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA) and available at SAM.gov | Home (click on Search Record, then click on Advanced Search-Exclusions) (Note: The OMB guidance at 2 CFR Part 180 and agency implementing regulations still refer to the SAM Exclusions as the Excluded Parties List System (EPLS)), (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300). Condition: The University did not have evidence that the University performed suspension and debarment checks for contractors on SAM.gov prior to entering into the contracts. Cause: The University either did not perform and/or retain evidence of checks for suspension and debarment for contractors. The University does not have a clear written policy or effective internal control over compliance with suspension and debarment requirements. Effect or potential effect: The University did not comply with suspension and debarment requirements. Without having effective internal controls over suspension and debarment, procurements could be entered into with a suspended or debarred entity. Questioned costs: $167,398 – Questioned costs were calculated based on the amount of two procurements for which no check for suspension or debarment was made for the vendors ($73,980 plus $93,418). Context: We issued a material weakness related to internal control over compliance with suspension and debarment requirements in the prior year. Based upon the implementation dates for the corrective action of February 24, 2025 and May 31, 2025, provided by management, the finding related to this internal control had not been remediated for the period under audit. As such, we did not test the operating effectiveness of this internal control and are issuing a material weakness consistent with the prior year finding. We selected and tested 2 procurements over $25,000 each with expenditures totaling $167,398, for the year ended May 31, 2025 for the School Safely National Activities program. The procurements were for an occupational therapist contractor ($73,980) and another vendor of supplies and materials ($93,418). The University had no evidence of suspension and debarment checks being performed prior to entering into the procurements. The University’s total School Safely National Activities program expenditures were $1,310,305 for the year ended May 31, 2025. Of this amount, $167,398 related to contracts or procurements of goods and services over $25,000. Identification as a repeat finding, if applicable: Yes – 2024-005 Recommendation: The University should develop and implement procedures and internal control to ensure that suspension and debarment requirements are complied with, and that support for the dates and the results of suspension and debarment checks on SAM.gov are retained. Also, the University should revise its procurement policy to include procedures for suspension and debarment. Views of responsible officials: Management agrees with the finding and has developed a corrective action plan which includes retention of documentation of suspension and debarment searches on SAM.gov and adding verbiage to contracts/purchase orders related to suspension and debarment. The corrective action was implemented by May 31, 2025.