Finding Text
Federal Agency: U.S. Department of Health and Human Services (HHS)
Pass-through Agency: N/A
Federal Programs Title: Head Start and Head Start Disaster Recovery
From Hurricanes Harvey, Irma and María
CFDA Number: 93.600 and 93.356
Compliance Requirement: Reporting
Type of Finding: Material Noncompliance and Material Weakness
Responsible Official: Federal Program Director
Criteria
The OMB Circular 133, establishes when a non-Federal entity enters a covered
transaction with an entity at a lower tier, the non-Federal entity must verity that the
entity, as defined in 2 CFR Section 180.995 and agency adopting regulations, is not
suspended, or debarred or otherwise excluded from participating in the transaction.
This verification may be accomplished by (1) checking the Excluded Parties List
System (EPLS) maintained by the General Services Administration (GSA) and
available at http://www.sam.gov/portal/public/SAM/.
We found is not recorded in http://www.sam.gov/portal/public/SAM/. We didn’t
find DUNS number and is possible is not an active company and doesn’t know if
that company is suspended or debarred or otherwise excluded from participating
for Head Start and Head Start Disaster Recovery from Hurricanes Harvey, Irma and
María programs.
Condition
The Municipality’s disbursement test, we tested 113 vouchers and found 2
disbursements without System Award Management number or not active with
funds payments more than $25,000.
Questioned costs
Not determined
Cause
Program officials did not verify if they are Excluded Parties List System (EPLS)
maintained by the General Services Administration (GSA) that the contracted entity
was suspended or debarred.
Effect
There is a risk that the contracted entity may have been debarred and might not
comply with the contract requirements, the program may recover funds.
Recommendation
We recommend that the potential entity to be contracted is verified on the internet
http://www.sam.gov/portal/public/SAM/ to assure there is no exclusions.
Management Response
Agreed with the Finding: It is crucial to highlight that the companies in question
were not the originally contracted ones; however, they did possess the required
SAM numbers. The decision to engage these companies arose from the realization
that the originally contracted entities were not in adherence to the agreed-upon
contractual terms. The identified companies were subsequently brought in under
emergency circumstances by the Board of Auctions to fulfill the Head Start
objectives. To forestall similar situations in the future, we are actively reviewing
and fortifying our supplier’s selection processes while implementing robust
contractual measures. It is important to underscore that this response was an
exceptional one to address non-compliance, and we are steadfast in our
commitment to avoiding such occurrences in the future.