Finding 1213655 (2025-001)

Material Weakness Repeat Finding
Requirement
I
Questioned Costs
-
Year
2025
Accepted
2026-05-05
Audit: 400591

AI Summary

  • Core Issue: The district exceeded the $50,000 procurement threshold without following required bidding processes.
  • Impacted Requirements: Violations include lack of public advertisement, absence of price quotations, and non-compliance with both state law and the district's own procurement policy.
  • Recommended Follow-Up: Review and revise procurement practices to ensure compliance with state and federal regulations moving forward.

Finding Text

The district procured equipment under ALN 84.425V exceeding the $50,000 threshold established in SDCL 5-18A-14. The procurement was not publicly advertised for bids as required by state law, nor were two to three price quotations obtained or documented in accordance with federal small purchase procedures. Additionally, the district did not follow its own adopted procurement policy, which incorporates Uniform Guidance and state law requirement.

Corrective Action Plan

Parkston School District Business Manager, Jason Michel, and Superintendent, Pat Mikkonen, are the contact people responsible for this corrective action. Our actions include the following for all new purchases: 1. Policy Reinforcement and Revision. The District Business Office personnel will review and update procurement policies to ensure alignment with federal and state requirements, which will help clearly define thresholds for small purchase , formal bids, and documentation expectations. 2. Staff Training. The District will provide mandatory training for all business office staff involved in purchasing that addresses the following topic areas: a) Federal procurement standards (Uniform Guidance), b) State bidding requirements, and c) District procurement policies. Training will occur annually and upon hiring of new personnel. 3. Procurement Procedures Implementation. The District will establish a standardized procurement checklist to be utilized by all business office personnel which will require: a) Documentation of quotes (minimum of 2 for small purchases), b) Public advertisement for bids when thresholds are exceeded, c) Written justification for vendor selection, d) pre-approval from the school board along with business office for all purchases exceeding $10,000. 4. Internal Review Process. The District will implement a pre-procurement review process which will be implemented by the Business Manager and the Superintendent for purchases over $10,000. The District will conduct quarterly internal audits of procurement files. 5. Documentaton Controls. The District will create and maintain a centralized procurement file (digital or physical) for all federally funded purchases and ensure all required documentation is retained and easily accessible for audit.

Categories

Procurement, Suspension & Debarment

Other Findings in this Audit

  • 1213653 2025-001
    Material Weakness Repeat
  • 1213654 2025-001
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
84.010 TITLE I GRANTS TO LOCAL EDUCATIONAL AGENCIES $232,210
84.425 EDUCATION STABILIZATION FUND $174,075
84.027 SPECIAL EDUCATION GRANTS TO STATES $134,247
84.367 SUPPORTING EFFECTIVE INSTRUCTION STATE GRANTS (FORMERLY IMPROVING TEACHER QUALITY STATE GRANTS) $27,997
84.424 STUDENT SUPPORT AND ACADEMIC ENRICHMENT PROGRAM $27,770
32.004 UNIVERSAL SERVICE FUND - SCHOOLS AND LIBRARIES $18,792
10.553 SCHOOL BREAKFAST PROGRAM $15,938
10.555 NATIONAL SCHOOL LUNCH PROGRAM $15,127
84.358 RURAL EDUCATION $10,686
84.173 SPECIAL EDUCATION PRESCHOOL GRANTS $7,830
84.048 CAREER AND TECHNICAL EDUCATION -- BASIC GRANTS TO STATES $3,706
84.181 SPECIAL EDUCATION-GRANTS FOR INFANTS AND FAMILIES $877