Finding Text
Finding 2022-005
Procurement, Suspension, and Debarment - Material Weakness in Internal
Control and Material Noncompliance
Agency U.S. Department of Treasury
Pass-through
Entity
State of Alaska Department of Commerce, Community, and Economic
Development
Program ALN: No. 21.027 Coronavirus State and Local Fiscal Recovery Funds – COVID-19
Award No. AK0137
Award Year 2022
Criteria or
Specific
Requirement
In accordance with 2 CFR section 200.320, the City is required to have and use
documented procurement policies consistent with the standards of the CFR
for any method of procurement used in the acquisition of property or services
required under the American Rescue Plan Act.
Condition Personnel at the City of Unalaska, acting under the local emergency in effect
for FY22 did not follow procurement policies consistent with 2 CFR 200.320
for small purchases in FY22.
Cause The City of Unalaska relaxed procurement policies per Resolution 2020-16
passed by the City Council on March 18, 2020. The relaxed procurement
policies were not consistent with procurement policies per 2 CFR 200.320.
Effect or potential
effect
The City was not in compliance with 2 CFR section 200.320 during 2022. Goods
and services procured by the City under the program may not be the most
cost-effective or appropriate for the City.
Questioned Costs None.
Context
We tested the procurement for one sample selected in FY22. BDO was unable
to obtain documentation for rate or quote solicitation for the selected sample
and upon inquiry, identified that procurement policies at the City were
relaxed during FY22.
Recommendation Procurement policies should be updated and documented so that they are at
least as restrictive as the policies required per the Code of Federal Regulation.
Views of responsible
officials and
planned corrective
actions
Management agrees with the finding. Management will review procurement
policies and update as needed to ensure they are at least as restrictive as the
policies required per the Code of Federal Regulation.