2025-001 Procurement, Suspension and Debarment U.S. Department of Education 84.421F Pathways To Success: Creating a 21st Century Workforce 2025 Award Year Criteria: Under 2 CFR §§ 200.318 – 200.327, non-Federal entities must maintain written procurement policies that reflect applicable Federal, State, and local laws and regulations. These policies must include standards of conduct, competition requirements, methods of procurement, contract oversight, and procedures for verifying suspension and debarment. Entities must follow these written policies when procuring goods and services under Federal awards. In addition, in accordance with the Uniform Guidance (2 CFR Part 180), recipients and subrecipients are prohibited from entering into covered transactions with parties that are suspended or debarred. Covered transactions include contracts for goods and services expected to equal or exceed $25,000 and all subawards regardless of dollar amount, unless specifically exempt. Recipients and subrecipients are required to verify that contractors and subrecipients are not suspended or debarred. Universe / Population: The universe / population for Procurement is written procurement policies that reflect applicable Federal, State, and local laws and regulations. The universe / population for Suspension and Debarment was 12 vendors for the year ended December 31, 2025. We haphazardly selected 5 vendors for testing of suspension and debarment compliance requirements applicable to the program. Condition: The Organization does not have a documented written procurement policy that complies with the requirements of 2 CFR §§ 200.318 – 200.327 or documented internal controls to ensure compliance with suspension and debarment requirements. Specifically, the Organization does not have written policies or procedures requiring verification that vendors or subrecipients are not suspended or debarred prior to entering into covered transactions, nor does it consistently document such verification. As a result, the Organization does not have a formal policy framework to guide procurement activities in accordance with Federal procurement standards. Cause: The Organization has not developed written procurement policies that incorporate the specific requirements of the Uniform Guidance, including required verification procedures and documentation standards. Effect: Without a compliant, documented procurement policy and effective internal controls, the Organization is at risk of noncompliance with Federal procurement standards, inconsistent procurement practices, failure to properly verify suspension and debarment, and ineffective internal controls over procurement activities. This condition also increases the risk that required suspension and debarment checks are not performed or documented. Although no questioned costs were identified for the period under audit, the absence of compliant written policies represents a control deficiency in internal control over compliance for procurement requirements. Questioned Costs: None Repeat Finding: No Recommendation: Management should develop and implement written procurement policies and procedures that fully comply with 2 CFR §§ 200.318 – 200.327. The policies should include internal controls to ensure that supporting documentation is maintained for all procurements, including documentation of procurement method determination, price or cost analysis, vendor selection, required approvals, and suspension and debarment verification. View of Responsible Officials: Going forward, Lighthouse Louisiana will ensure that its procurement policy reflects its commitment to purchases made in a manner that promotes full and open competition, supports price reasonableness, and maintains appropriate documentation based on the applicable procurement threshold. Management confirms that the Organization will apply a $10,000 micro-purchase threshold, require price or rate quotations from an adequate number of qualified sources for small purchases between $10,000 and $250,000, and require a formal competitive process for procurements exceeding $250,000, unless a properly documented exception applies. Lighthouse Louisiana did not actively retain all SAM.gov search results in vendor files for each vendor included in the procurement testing; however, if a SAM.gov verification was performed but not retained in the file, management will document the issue, perform and retain an updated verification, and strengthen internal controls to require retention of SAM.gov evidence before agreement execution or renewal. As part of its corrective action, Lighthouse Louisiana will enhance its procurement file review process to ensure that each grant-funded procurement contains, as applicable, the procurement method determination, supporting quotes or price comparisons, price reasonableness analysis, vendor selection rationale, required approvals, contract or agreement, and SAM.gov verification. Management will also reinforce staff training on procurement documentation requirements and will implement a standardized procurement checklist for grant-funded purchases. The Chief Financial Officer, Chief Operations Officer, and Project Director will be responsible for ensuring that any requested documentation is gathered and submitted to the auditors and that procurement file improvements are implemented prospectively.