Finding 576868 (2022-003)

Condition: Hill County is responsible for complying with Uniform Guidance and the Suspension and Debarment compliance requirement as required by the contract and federal award documents for ARPA funds. Criteria: Prior to entering into subawards and contracts with award funds, recipients must verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded pursuant to 31 CFR section 19.300. Context: In reviewing contract HC 22-120, the County was unable to provide proof that, prior to entering the contract, the County verified the contractor was not suspended, debarred, or otherwise excluded pursuant to 21 CFR section 19.300. Cause: The County’s Procurement Policy does not address Suspension and Debarment when performed internally rather than by a third party. Effect: Contractors may be suspended, debarred, or otherwise excluded pursuant to 21 CFR section 19.300, thus putting the County out of compliance with the federal award. Recommendation: Prior to entering into any subawards and contracts with award funds, the County should verify the contractor was not suspended, debarred, or otherwise excluded pursuant to 21 CFR section 19.300, and document accordingly. Planned Corrective Action: The County will update the Procurement Policy to address Suspension and Debarment when performed internally and will ensure that staff responsible for federal grant awards understands the requirement and will verify and document compliance.