Finding 971413 (2022-001)

Material Weakness Repeat Finding
Requirement
L
Questioned Costs
$1
Year
2022
Accepted
2024-04-29
Audit: 304861
Organization: City of Turlock (CA)

AI Summary

  • Core Issue: The City failed to verify that vendors were not suspended or debarred before entering contracts, violating grant compliance requirements.
  • Impacted Requirements: This finding breaches OMB Guidelines and the City’s agreement with the Department of Treasury regarding vendor eligibility.
  • Recommended Follow-Up: The City should create and implement procedures for verifying vendor compliance with debarment rules and maintain proper documentation.

Finding Text

Finding Reference Number: SA2022-001 - Suspension and Debarment for Contracts and Subcontracts Assistance Listing Numbers: 21.027 Assistance Listing Title: COVID-19 – Coronavirus State and Local Fiscal Recovery Funds Name of Federal Agency: Department of Treasury Pass Through Entity: California State Water Resources Control Board Federal Award Identification Number: SLFRP4371 266737 Criteria: The Award Terms and Conditions in the City’s Coronavirus Local Fiscal Recovery Funds Agreement with the U.S. Department of the Treasury requires that the City comply with OMB Guidelines to Agencies on Governmentwide Debarment and Suspension (Nonprocurement), 2 CFR Part 180, including the requirement to include a term or condition in all lower tier covered transactions (contracts and subcontracts described in 2 CFR Part 180, subpart B) that the award is subject to 2 CFR Part 180 and Treasury’s implementing regulation at 31 CFR Part 19. In addition, the OMB Compliance Supplement requires that 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. Condition: We selected 19 transactions for testing that included six different vendors and understand that the City did not verify that the vendors were not suspended, debarred, or otherwise excluded prior to entering into the agreements. We did note that City staff determined that as of April 8, 2024, none of the six vendors were on the exclusions list on SAM.gov. Cause: We understand that staff responsible for performing the suspension and debarment reviews are no longer with the City and City staff cannot find documentation that it was performed. Identification as a repeat finding: Yes, since 2021 Effect: The City is not in compliance with the grant Award Terms and Conditions. Recommendation: The City should develop procedures to ensure compliance with debarment and suspension provisions of the grant agreement prior to making disbursements to vendors and retain documentation in the grant files. View of Responsible Officials and Planned Corrective Actions: Please see Corrective Action Plan separately prepared by the City.

Categories

Questioned Costs Procurement, Suspension & Debarment Subrecipient Monitoring

Other Findings in this Audit

  • 394971 2022-001
    Material Weakness Repeat
  • 394972 2022-002
    Significant Deficiency
  • 394973 2022-003
    Material Weakness
  • 394974 2022-003
    Material Weakness
  • 394975 2022-004
    Significant Deficiency
  • 394976 2022-004
    Significant Deficiency
  • 971414 2022-002
    Significant Deficiency
  • 971415 2022-003
    Material Weakness
  • 971416 2022-003
    Material Weakness
  • 971417 2022-004
    Significant Deficiency
  • 971418 2022-004
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
20.205 Highway Planning and Construction $1.45M
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $719,197
21.027 Coronavirus State and Local Fiscal Recovery Funds $217,137
16.710 Public Safety Partnership and Community Policing Grants $166,667
14.239 Home Investment Partnerships Program $116,890
20.507 Federal Transit_formula Grants $98,257
16.738 Edward Byrne Memorial Justice Assistance Grant Program $56,675
20.608 Minimum Penalties for Repeat Offenders for Driving While Intoxicated $14,481
20.600 State and Community Highway Safety $14,469
16.034 Coronavirus Emergency Supplemental Funding Program $5,980