Finding Text
Finding 2024-002 – Non-compliance with Internal Procurement Policy (Other Matter)
Capital Fund Program – Assistance Listing No. 14.872; Grant Period - Fiscal Year-Ended September 30, 2024
Repeat Finding – Fiscal Year 2023 Audit Finding #2023-002
Criteria
Public Housing Authorities (PHA’s) should procure federally-funded contracts in accordance with a formal, documented internal Procurement Policy based on federal procurement guidelines, including HUD Handbook 7460.8, Rev. 2, Procurement Handbook for Public Housing Agencies. PHA’s are prohibited from awarding contracts to contractors who have been suspended or debarred from performing contracts funded with federal subsidies. Additionally, the Authority’s Procurement Policy dictates full compliance with the Handbook. PHA’s are permitted to comply with the applicable regulations by A) searching the Excluded Parties List System (EPLS) for the prospective contractor, or B) attaining a certified statement from the contractor in which the contractor certifies against suspension or debarment.
Condition and Perspective
Three Capital Fund Program funded contract awards were sampled. Two applicable contracts awarded in the amounts of $35,841 and $51,264, did not contain the contractors’ certifications against suspension and debarment or evidence that the EPLS was searched for the contractors.
Questioned Costs – None
Cause
Lack of knowledge of federal procurement requirements among applicable personnel administering contract awards.
Effect
Non-compliance with the Authority’s Procurement Policy and federal regulations.
Recommendation
We recommend that the Authority attain certification against suspension and debarment or search the EPLS for prospective contractors prior to awarding contracts.
Management’s Response
The Authority will attain certification against suspension and debarment or search the EPLS for prospective contractors prior to awarding contracts. The Authority’s Executive Director, Erial Branch, has assumed the responsibility of executing this corrective action as of April 30, 2025.