Finding 35846 (2022-001)

Material Weakness
Requirement
I
Questioned Costs
-
Year
2022
Accepted
2023-04-17

AI Summary

  • Core Issue: The School District did not keep necessary documentation proving that competitive bidding procedures were followed when awarding a contract to Prodigy Building Solutions, LLC.
  • Impacted Requirements: This oversight violates 2 CFR § 200.320(b) and 2 CFR § 200.318(e), which mandate formal procurement methods and documentation.
  • Recommended Follow-Up: The School District should review Uniform Guidance and Ohio Revised Code requirements before future contracts to avoid potential citations and loss of grant funding.

Finding Text

2 CFR ? 3474.1 provides the Department of Education (DOE) adopts the Office of Management and Budget (OMB) Guidance in 2 CFR part 200. Thus, this section gives regulatory effect to the OMB guidance and supplements the guidance as needed for the DOE, except as otherwise noted in that section. 2 CFR ?200.320(b) states in part that when the value of the procurement for property or services under a Federal financial assistance award exceeds the simplified acquisition threshold, or a lower threshold established by a non-Federal entity, formal procurement methods are required. Formal procurement methods require following documented procedures. Formal procurement methods also require public advertising unless a non-competitive procurement can be used in accordance with ? 200.319 or paragraph (c) of this section. 2 CFR ? 200.318(e) states to foster greater economy and efficiency, and in accordance with efforts to promote cost-effective use of shared services across the Federal Government, the non-Federal entity is encouraged to enter into state and local intergovernmental agreements or inter-entity agreements where appropriate for procurement or use of common or shared goods and services. Competition requirements will be met with documented procurement actions using strategic sourcing, shared services, and other similar procurement arrangements. Ohio Rev. Code ? 167.081, states that a regional council may enter into a unit price contract for materials, labor, services, overhead, profit, and associated expenses for the repair, enlargement, improvement, or demolition of a building or structure if the contract is awarded pursuant to a competitive bidding procedure of a county, municipal corporation, or township or a special district, school district, or other political subdivision that is a council member. A political subdivision that is a member of a regional council may participate in a contract entered into under Ohio Rev. Code ? 167.081. Purchases under a contract entered into under Ohio Rev. Code ? 167.081 are exempt from any competitive selection or bidding requirements otherwise required by law. The School District participated in The Ohio Purchasing Council?s unit price contract with Prodigy Building Solutions, LLC., for the School District's roofing, HVAC, and lighting project, pursuant to Ohio Rev. Code ? 167.081. The School District utilized ESSER grant funds for part of this project. The School District did not maintain documentation that the Ohio Purchasing Council followed competitive bidding procedures of a council member pursuant to Ohio Rev. Code ?. 167.081 when awarding the unit price contract to Prodigy Building Solutions, LLC. and therefore failed to meet the documentation requirements of 2 CFR ? 200.320(b) and 2 CFR ? 200.318(e) noted above. Failure to comply with the applicable Uniform Guidance requirements and the Ohio Revised Code could result in further citations for the School District and potential loss of grant funding. The School District should review the applicable Uniform Guidance requirements and the Ohio Revised Code before entering into any contracts.

Categories

Procurement, Suspension & Debarment

Other Findings in this Audit

  • 35845 2022-001
    Material Weakness
  • 35847 2022-001
    Material Weakness
  • 612287 2022-001
    Material Weakness
  • 612288 2022-001
    Material Weakness
  • 612289 2022-001
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
84.010 Title I Grants to Local Educational Agencies $830,860
10.555 National School Lunch Program $753,792
84.027 Special Education_grants to States $541,278
10.559 Summer Food Service Program for Children $369,665
10.553 School Breakfast Program $251,264
84.367 Improving Teacher Quality State Grants $124,438
84.358 Rural Education $63,820
84.425 Education Stabilization Fund $27,029
84.173 Special Education_preschool Grants $18,197
84.424 Student Support and Academic Enrichment Program $7,315
10.649 Pandemic Ebt Administrative Costs $3,063