Finding Text
Finding Reference Number: SA2022-001 - Suspension and Debarment for Contracts and
Subcontracts
Assistance Listing Numbers: 21.027
Assistance Listing Title: COVID-19 – Coronavirus State and Local Fiscal Recovery Funds
Name of Federal Agency: Department of Treasury
Pass Through Entity: California State Water Resources Control Board
Federal Award Identification Number: SLFRP4371
266737
Criteria: The Award Terms and Conditions in the City’s Coronavirus Local Fiscal Recovery Funds Agreement with the U.S. Department of the Treasury requires that the City comply with OMB Guidelines to Agencies on Governmentwide Debarment and Suspension (Nonprocurement), 2 CFR Part 180, including the requirement to include a term or condition in all lower tier covered transactions (contracts and subcontracts described in 2 CFR Part 180, subpart B) that the award is subject to 2 CFR Part 180 and Treasury’s implementing regulation at 31 CFR Part 19. In addition, the OMB Compliance Supplement requires that prior to entering into subawards and contracts with award funds, recipients must verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded pursuant to 31 CFR section 19.300.
Condition: We selected 19 transactions for testing that included six different vendors and understand that the City did not verify that the vendors were not suspended, debarred, or otherwise excluded prior to entering into the agreements. We did note that City staff determined that as of April 8, 2024, none of the six vendors were on the exclusions list on SAM.gov.
Cause: We understand that staff responsible for performing the suspension and debarment reviews are no longer with the City and City staff cannot find documentation that it was performed.
Identification as a repeat finding: Yes, since 2021
Effect: The City is not in compliance with the grant Award Terms and Conditions.
Recommendation: The City should develop procedures to ensure compliance with debarment and suspension provisions of the grant agreement prior to making disbursements to vendors and retain documentation in the grant files.
View of Responsible Officials and Planned Corrective Actions: Please see Corrective Action Plan separately prepared by the City.