Finding Text
Finding – Internal control deficiencies over procurement requirements
Identification of the Federal Program:
Assistance Listing Number and Title: 14.231, Emergency Solutions Grant Coronavirus Program
Federal Grantor Name: U.S. Department of Housing and Urban Development
Federal Award/Contract Number: NA
Pass-through Entity Name: California Department of Housing and Community Development
Pass-through Award/Contract Number: 20-ESGCV-3-00002
Compliance Requirement – Procurement and Suspension and Debarment
Condition:
The City did not comply with 2 CFR 200.320 or with City procurement policies. The City did not
obtain quotes for vehicles purchased.
Criteria:
Grant recipients must comply with Uniform Guidance for procurement, specifically with 2 CFR
sections 200.318 thru 200.326 including ensuring the procurement method used for the contracts are
appropriate based on the dollar amount and conditions specified in 2 CFR section 200.320(a)(1) and
(2).
Cause:
The City did not have proper internal control over the procurement requirements of this federal
program.
Effect:
The City is out of compliance with procurement requirements.
Questioned Costs:
$199,274
Context:
A small purchase could have been applied as the total amount spent under the contract was more than
the micro-purchase amount but less than the simplified acquisition threshold. Under small purchase
procedures price or rate quotes must be obtained.
Identification of a repeat finding:
Not a repeat finding.
Recommendation:
We recommend that the City establish and maintain effective internal control ensuring an understanding
of procurement compliance requirements prior to entering into contracts with vendors with the intention
of using grant monies.
Views of responsible officials:
Management concurs with the finding.