Finding 520792 (2024-002)

Federal Award Identification Assistance Listing Program Title Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Program Number 21.027 Federal Award ID Number and Year SLFRP1965 Federal Agency U.S. Department of the Treasury Pass-Through Entity Nebraska Department of Health and Human Services Significant Deficiency in Internal Control Over Procurement and Suspension and Debarment Criteria The Health Department’s procurement policy states that documentation of procurements shall be retained for seven years and shall include all federally-required elements of procurement transactions. The Health Department’s procurement policy states that it will require all vendors to self-certify that they are not suspended or debarred. The Health Department is to then check that statement against the Federal System for Award Management. This policy is in compliance with 2 CFR 200.212; 2 CFR 200.318(h); 2 CFR 180.300; 48 CFR 52.209-6. Condition The Health Department did not retain evidence of its procurement of a covered transaction. The Health Department entered into a covered transaction prior to verifying whether the contractor was suspended or debarred. Repeat Finding No. Cause The Health Department did not have a system of controls in place to ensure that their procurement policy was followed. Effect or Potential Effect The Health Department may neglect to procure covered transactions. The Health Department may enter into a covered transaction with a debarred, suspended, or otherwise excluded vendor. Questioned Costs No. Statistical Sample No. Context The Health Department entered into a covered transaction during the year to modernize its restrooms. The Health Department followed its procurement policy and requested proposals from an adequate number of vendors. However, despite repeated attempts to obtain multiple bids, the Health Department was only able to obtain a bid from single vendor. The Health Department proceeded with that bid, as evidenced by the publicly-available board minutes, but failed to follow its procurement policy as it pertains to 1) documentation retention requirements and 2) suspension and debarment. In testing this transaction, the auditor performed a search on the System for Award Management website, noting that the vendor is not on the exclusion list. Recommendation The auditor recommends that the Health Department establish a robust system of controls to ensure it complies with its procurement policy when entering into covered transactions. Views of Responsible Officials See Corrective Action Plan, below.