Finding Text
Procurement ? Noncompliance/Material Weakness Finding Number: 2022-002 Assistance Listing Number and Title: AL #84.425D/84.425U/84.425W Education Stabilization Fund Federal Award Identification Number / Year: None / 2022 Federal Agency: US Department of Education Compliance Requirement: Procurement, Suspension and Debarment Pass-Through Entity: Ohio Department of Education Repeat Finding from Prior Audit? No 2 CFR ? 3474.1 gives regulatory effect to the Department of Education for 2 CFR ? 200.319 (a) which states, in part, all procurement transactions for the acquisition of property or services required under a Federal award must be conducted in a manner providing full and open competition consistent with the standards of this section and ? 200.320. 2 CFR ? 3474.1 gives regulatory effect to the Department of Education for 2 CFR ? 200.320 (b) which states, in part, when the value of the procurement for property or services under a Federal financial assistance award exceeds the simplified acquisition threshold (SAT), 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. The School District's Federal Procurement policy DJI provides, in part, ?when using federal money for procurement, the District shall conform to applicable Federal laws, regulations, and standards?. The School District's policy also states, ?The District shall seek a minimum of two price quotations for any proposed procurement that will be paid for with federal monies, even if the bidding amount falls below the applicable federal or state competitive bidding thresholds or the District-imposed threshold set forth in Board Policy DJF, unless the procurement falls under federal requirements for a noncompetitive proposal.? Board Policy DJF-R provides, the School District will obtain price rates or quotations from a minimum of two vendors for small purchases between $10,000 and $250,000 when using federal funds. The School District contracted with Farnham Equipment Company and paid $63,025 from the Education Stabilization Fund. The School District was unable to provide documentation that they obtained a minimum of two price quotations or documentation that procurement policies were followed. Without proper controls over procurement, there is an increased risk that the School District is not in compliance with applicable federal regulations. Additionally, noncompliance could result in federal funding being reduced or taken away, or other sanctions imposed by the federal grantor agency. The School District should review the federal regulations and ensure that all required procurement policies are followed for applicable contracts.