Finding 1217263 (2025-001)

SIGNIFICANT DEFICIENCY 2025-001 PROCUREMENT, SUSPENSION & DEBARMENT Federal Agency: Department of Health and Human Services Federal Program or Cluster: Grants for Capital Development in Health Centers Assistance Listing Number: 93.526 Federal Award Numbers and Years Award Period: 9/15/21-8/31/25 - 4 C8ECS44755-01-07 Questioned Costs $0 Condition: We identified an instance where the Organization did not verify the suspension and debarment status of a vendor prior to awarding the vendor a federal contract. documentation of verification through SAM.gov or equivalent methods could not be provided by management. Subsequent review of SAM.gov indicated no instances of suspended or debarred vendors used on the project funded with federal awards. Criteria: In accordance with 2 CFR 200.214, nonfederal entities are subject to procurement, debarment and suspension regulations. The regulations in 2 CFR part 180 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. Cause: The Organization did not follow its internal policy for procurement, suspension and debarment. Effect: Failure to verify vendor eligibility increases the risk of awarding federal funds to ineligible parties, which may result in questioned costs and potential disallowance of expenditures by a federal awarding agency. Recommendation: We recommend the Organization ensure the staff involved with procuring contracts using federal awards are aware of the federal requirement, including the already established policies that the Organization has regarding such requirements. Identification of repeat findings: This is not a repeat finding. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding. The Organization has reviewed and updated the Organization's procurement policy in May 2025 and has trained staff as necessary to ensure staff adhere to the policy prospectively.