Finding Text
2024-003: Healthy Start Procurement Compliance and Control Deficiency
Grantor: Department of Health and Human Services
Program Title: Healthy Start Initiative
Award Name: Healthy Start Initiative‐Eliminating Racial/Ethnic Disparities
Award Number: H4927805
Assistance Listing Title: Healthy Start Initiative
Assistance Listing Number: 93.926
Award Year: April 1, 2023 – August 31, 2024
Passthrough Entity: None
Criteria
Per 2 CFR 200.318-320, the auditee must maintain and use documented procedures for procurement
transactions under a Federal award, including that procurement transactions must be conducted in a manner
that provides full and open competition.
Condition
In accordance with JHHS’ Competitive Bidding Policy dated 5/5/2020, competitive bidding must be performed
for all purchases under federal grants that exceed $3,000. JHHS’ policy has three exceptions: 1) emergency
procurements, 2) compatible product requirements, which includes an option for the completion of a sole source
justification memo, and 3) recently bid products/ services. For 2 of 2 procurement selections tested during the
audit for the Healthy Start Initiative award, no evidence was found that competitive bidding procedures were
followed in accordance with JHHS policy.
Cause
There was no control operating to ensure adherence to JHHS’s Competitive Bidding Policy on competitive
bidding or sole source justification requirements prior to entering into a procurement transaction.
Effect
JHHS was not in compliance with federal requirements relating to procurement and two transactions were
entered into without full and open competition.
Questioned Costs
There are no questioned costs associated with this finding.
Recommendation
JHHS should establish a control process to ensure that all required competitive bidding or sole source
justification requirements are followed including review and approval prior to entering into procurement
transactions, and evidence of such review and approval is maintained. JHHS should also ensure appropriate
training and communication is shared with all departments responsible for managing federal grant programs to
ensure adherence to federal requirements and with JHHS policy.
Management’s Views and Corrective Action Plan
Refer to Management’s View’s and Corrective Action Plan at the end of the report.