Finding 966710 (2023-003)

2023-003 Procurement, Suspension and Debarment U.S. Department of Education/Pass-through Texas Department of Agriculture Federal Assistance Listing Number 10.568 – Emergency Food Assistance Program (Administrative Costs) Award Numbers: TX-101-7058 and 01534 Award Years: 10/1/21 – 9/30/22 and 10/1/22 – 9/30/23 Federal Assistance Listing Number 10.187 – Commodity Credit Corporation (Administrative Costs) Award Number: 01534 Aware Year: 10/1/22 – 9/30/23 Federal Assistance Listing Number 10.565 – Commodity Supplemental Food Program (Administrative Costs) Award Number: TX-101-4001 Award Years: 10/1/21 – 9/30/22 and 10/1/22 – 9/30/23 Type of Finding: Other instance of noncompliance Criteria: Management is responsible for internal controls over compliance with Procurement, Suspension, and Debarment in accordance with the Uniform Guidance. Condition: Management has a procurement policy in place to ensure compliance with federal law and standards. However, one vendor’s contract was renewed without a formal bidding process and verification of suspension and debarment as required according to the procurement policy. Questioned Costs: None Context/Sampling: A nonstatistical sample of 3 out of 14 vendors were selected for testing. Cause: During the time the vendor was due for renewal, there was turnover of the CFO. Therefore, The Food Bank did not allocate enough time and resources to properly prepare a bidding process. Effect or potential effect: Lack of compliance with Procurement, Suspension, and Debarment compliance requirement may result in reduced future funding for the program. Recommendation: We recommend The Food Bank incorporate controls and procedures to ensure the Procurement Policy is being adhered to at all times. Views of Responsible Officials: The Food Bank agrees with the finding. Due to turnover and transitions in key positions during the COVID-19 pandemic, a contract agreement was renewed with Houston Food Bank’s benefits broker without a formal bidding process. Corrective Actions: In FY 2024 vendor analysis by the Procurement department has been completed and communicated to each director to create an RFP schedule for all contract renewals. Annual education of directors and managers on the procurement policy, informal bid, and formal bid processes was completed in June 2023.