Finding Text
Finding 2023-005 Internal Control Over Suspension and Debarment
Identification of the Federal Programs:
Assistance Listing Number: 20.507
Assistance Listing Title: Federal Transit Cluster
Federal Agency: U.S. Department of Transportation
Pass-Through Entity: N/A
Federal Award Identification Number: CA-2017-149-00; CA-90-Z085-00; CA-90-Y974-00; CA -2019-
033-00; CA -90-Y900-00; CA-2020-177-00; CA-2021-169-01;
CA-2022-041-00; CA-2021-075-00
Assistance Listing Number: 21.207
Assistance Listing Title: Coronavirus State and Local Fiscal Recovery Funds (“CSLFRF”)
Federal Agency: U.S. Department of Treasury
Pass-Through Entity: N/A
Federal Award Identification Number: N/A
Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation):
Prior to entering into subawards and contracts with award funds, recipients must ensure that contractors and subcontractors are not suspended from participating in federally funded projects. Verification is typically done by reviewing the System for Award Management (“SAM”) database and including certifications in contacts.
Condition:
During the audit over suspension and debarment, we noted that there were no documentation on whether the vendors were checked against the SAM database or obtained required certifications before contract awards.
Cause:
There were no formal policies or procedures of the verification on the suspension and debarment status of vendors before entering into a federally funded contract.
Effect or Potential Effect:
Without verifying whether vendors are suspended or debarred from working on federally-funded projects prior to the contract being awarded, the City could be contracting with vendors that are prohibited from working on federally funded projects and incurring potentially disallowed costs.
Questioned Costs:
None noted.
Context:
See condition above for the context of the procurement finding. No support was provided for 6 out of 6 Federal Transit Cluster vendors selected for testing and 3 out of the 3 CSLFRF vendors selected for testing to show suspension and debarment check was performed prior to contracting.
Identification as a Repeat Finding, If Applicable:
Not applicable.
Recommendation:
We recommended the City update its purchasing policies and related procedures related to suspension and debarment to improve its internal control over compliance for suspension and debarment.
Views of Responsible Officials:
The City has implemented a new review, tracking and documentation process for all procurements. Staff will check all vendors -- regardless of the nature of the funding for the project – against SAM.GOV to check for disbarment. A PDF of the results for each vendor is saved in a project folder attached to each procurement. These files are stored on an internal network drive.