Finding 498503 (2023-005)

Significant Deficiency
Requirement
I
Questioned Costs
-
Year
2023
Accepted
2024-09-26
Audit: 321234
Organization: Peoria Housing Authority (IL)

AI Summary

  • Core Issue: The Authority failed to provide necessary documentation for vendor procurement, including evaluations and bonding for Merit Construction.
  • Impacted Requirements: This noncompliance violates federal regulations under 2 CFR Part 200, which mandate proper procurement procedures and documentation.
  • Recommended Follow-up: Review all active contracts to ensure compliance with procurement policies and implement monitoring to maintain required documentation moving forward.

Finding Text

Finding 2023-005 – Procurement – Lack of Support for Procurement of Vendor Noncompliance & Significant Deficiency – ALN 14.850 & 14.872 Criteria: Regulations at 2 CFR Part 200, Uniform Administrative Requirements, outline the procurement standards that are required for recipients of federal grant awards. The nonfederal entity must have and use documented procurement procedures, consistent with state, local, and tribunal laws and regulations and the standards of this section. The nonfederal entity must create and adhere to its local Procurement Policy which has been approved by its board of directors. Condition: We examined five (5) contracts for our tests of the internal controls related to the procurement of vendors. The Authority entered into the contract agreement 404-08-23-RFP with both Merit Construction and Hoagland Construction. We noted that the Authority conducted its procurement on the basis of evaluation in the form of an RFP and competitive proposal. We found a few deviations from expectations which are detailed below:  The Authority was unable to produce evaluations and scoring for Merit Construction. The Authority was also unable to produce documentation on why Merit Construction was selected for the job.  The Authority was unable to produce bid, performance, and payment bonding for Merit Construction Cause: The Authority has experienced significant staff turnover within the past year. It is possible that those items mentioned above were performed and completed, but the Authority is unable to demonstrate them to us. Effect: Noncompliance with local and federal procurement requirements can lead to findings and penalties related to funding. Recommendation: We recommend that the Authority conducts a review of active contracts to ensure that all information related to the procurement of vendors is maintained effectively per the local procurement policy. We also recommend that going forward the Authority monitor this process to ensure that these supporting files are evidenced and maintained.

Corrective Action Plan

2023-005 Procurement - Lack of Support for Procurement of Vendor - ALN 14.850 & 14.872 -Noncompliance & Significant Deficiency Action planned in response to finding: To address the noncompliance and significant deficiency issues related to procurement of vendors, specifically focusing on vendor management, by improving procurement processes and ensuring adequate documentation. 1. Assess Current Procurement Process: Review and evaluate current procurement procedures, guidelines, and documentation requirements to identify areas of improvement and potential gaps. 2. Develop Updated Procurement Policies and Procedures: Establish clear and comprehensive procurement policies and procedures that align with regulatory requirements. Ensure they are well­ documented and easily accessible to staff. 3. Training and Communication: Conduct training sessions for all relevant staff members on the updated procurement policies and procedures. Provide ongoing support and encourage open communication to address any concerns or questions. 4. Implement a Monitoring System: Establish a system to monitor and track the procurement process, ensuring adherence to policies and regulations. Regularly review and update the system as needed. 5. Conduct Regular Audits and Reviews: Schedule regular audits and reviews to assess compliance with procurement policies and procedures, as well as regulatory requirements. Identify any areas of noncompliance or deficiency and develop corrective action plans. 6. Vendor Management: Implement a vendor management system to ensure proper documentation and tracking of vendor performance. Regularly evaluate and assess vendor relationships to maintain alignment with organizational goals and objectives. 7. Establish Accountability Measures: Clearly define roles and responsibilities for procurement­ related tasks and establish performance metrics to measure success and identify areas for improvement. Timeline: Peoria Housing Authority will begin assessing the current procurement process immediately and begin making the necessary updates to the procurement policies and procedures. At the end of each quarter, the COO and CFO will review contracts to be sure PHA remains in compliance. This process will be implemented by March 31, 2025. In addition, quarterly progress reports will be submitted to the Executive Office to monitor the implementation of the action plan. Adjustments will be made as needed based on feedback and results from audits, reviews, and staff input. Planned completion date for the corrective action plan: Ongoing, December 31, 2024 Person Responsible: Rachel Pollard and Shawn Joy

Categories

Procurement, Suspension & Debarment

Other Findings in this Audit

  • 498504 2023-005
    Significant Deficiency
  • 498505 2023-004
    Significant Deficiency Repeat
  • 1074945 2023-005
    Significant Deficiency
  • 1074946 2023-005
    Significant Deficiency
  • 1074947 2023-004
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
14.871 Section 8 Housing Choice Vouchers $13.01M
14.850 Public and Indian Housing $3.04M
14.872 Public Housing Capital Fund $1.33M
14.879 Mainstream Vouchers $394,358
14.896 Family Self-Sufficiency Program $104,695
14.870 Resident Opportunity and Supportive Services - Service Coordinators $62,790