FAC Explorer

Finding 42700 (2022-003)

Material Weakness
Requirement
I
Questioned Costs
$1
Year
2022
Accepted
2023-07-09
Audit: 43947
Organization: City of Thibodaux, Louisiana (LA)
Auditor: Postlethwaite & Netterville Apac

AI Summary

  • Core Issue: The City failed to seek competition for two professional services contracts totaling $426,333, violating federal procurement standards.
  • Impacted Requirements: Noncompliance with Uniform Guidance (2 CFR 200.319(a)) which mandates full and open competition for federal awards.
  • Recommended Follow-Up: The City should establish clear policies and procedures to ensure compliance with federal procurement requirements moving forward.

Finding Text

PROCUREMENT OF PROFESSIONAL SERVICES United States Department of the Treasury COVID-19 ? Coronavirus State and Local Fiscal Recovery Funds (Federal Assistance Listing No. 21.027) Criteria: The Uniform Guidance administrative requirements and cost principles apply to federal funding awarded on or after December 26, 2014. 2 CFR 200, Subpart D ? Post Federal Award Requirements Section 200.319(a) requires that all procurement transactions for the acquisition of property or services acquired under a federal award must be conducted in a manner providing full and open competition consistent with the standards of this section. Condition: Two professional services contracts selected for testing. The population consisted of these two professional services contracts totaling $426,333. The City did not seek competition when procuring these contracts. Additionally, it was noted through discussions with the Council Administrator that competition is not sought to procure professional services. Cause: The City does not have policies and procedures in place to ensure open competition was sough when procuring professional services with federal awards. Questioned Costs: $146,326 Effect: The City is noncompliant with Uniform Guidance procurement standards and may not be receiving the most advantageous rates for these services. Recommendation: The City should implement policies and procedures that ensure the proper procedures are followed to ensure compliance with federal procurement requirements. Identification of a repeat finding: This is a new finding in the current year. View of Responsible Official: Management concurs with the finding.

Corrective Action Plan

The City of Thibodaux was unaware of the federal mandate for procuring engineering services. One project was a supplement to a project that had a portion left off of the initial project. Since the City of Thibodaux already had an engineer in place, a contract amendment with the engineer was executed. However, this construction project totals over $1.1 million without engineering services; therefore, the City feel it can still substantiate the costs with the use of Coronavirus funding. The City had already decided and executed a contract with a local engineer for the second project before deciding to use Coronavirus funding for the project. However, this construction project totals over $3.7 million without engineering services; therefore, the City feels it can still substantiate the cost with the use of Coronavirus funding. The Finance Director, Jessica Hebert, will work on updating the policy by December 31, 2023.

Categories

Questioned Costs Procurement, Suspension & Debarment Allowable Costs / Cost Principles

Other Findings in this Audit

  • 42699 2022-002
    Material Weakness
  • 42701 2022-004
    Significant Deficiency
  • 42702 2022-003
    Material Weakness
  • 42703 2022-004
    Significant Deficiency
  • 619141 2022-002
    Material Weakness
  • 619142 2022-003
    Material Weakness
  • 619143 2022-004
    Significant Deficiency
  • 619144 2022-003
    Material Weakness
  • 619145 2022-004
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $4.03M
21.027 Coronavirus State and Local Fiscal Recovery Funds $850,810
11.300 Investments for Public Works and Economic Development Facilities $656,735
20.205 Highway Planning and Construction $249,674
97.039 Hazard Mitigation Grant $181,830
14.218 Community Development Block Grants/entitlement Grants $66,482
14.871 Section 8 Housing Choice Vouchers $31,522
20.601 Alcohol Impaired Driving Countermeasures Incentive Grants I $15,840
20.106 Airport Improvement Program $9,850
16.607 Bulletproof Vest Partnership Program $4,693
20.600 State and Community Highway Safety $3,083