Finding 1238602 (2025-004)

2025-004 Procurement Prior Year Finding Number: N/A Year of Finding Origination: 2025 Type of Finding: Internal Control Over Compliance and Compliance Severity of Deficiency: Material Weakness and Modified Opinion Federal Agency: U.S. Department of Justice Program: 16.710 Public Safety Partnership and Community Policing Grants Award Number and Year: 15JCOPS-24-GG-02198-TECP; 2025 Pass-Through Agency: N/A - Direct Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish, document, and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Title 2 U.S. Code of Federal Regulations § 200.318(i) states that the County must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Additionally, the County must follow further federal guidance over full and open competition as provided in Title 2 U.S. Code of Federal Regulations § 200.319 and perform a cost or price analysis as provided in Title 2 U.S. Code of Federal Regulations § 200.324. Condition: For one contract over the simplified acquisition threshold tested, no documentation was maintained detailing the history of the procurement demonstrating full and open competition, or that a cost or price analysis was performed. Questioned Costs: $273,011; known questioned costs were calculated as the amount of the contract. Context: The threshold used for the procurement testing was based on the County's policy for simplified acquisition threshold which is over $175,000. The population consisted of two contracts over the simplified acquisition threshold; both contracts were tested. Effect: Documentation detailing the procurement was not maintained and therefore it cannot be determined whether the County provided full and open competition or performed a cost or price analysis. Cause: The County relied on a sole source contract established within the County between a vendor and the Ramsey/Washington Recycling & Energy Board. Ramsey County staff who purchased the generators believed that the contract used was competitively bid. Recommendation: We recommend the County maintain documentation on the history of a procurement, provide for full and open competition, and perform a cost or price analysis to support compliance with Title 2 U.S. Code of Federal Regulations §§ 200.318, 200.319, and 200.324. View of Responsible Official: Concur