Finding Text
U.S. Department of Transportation; U.S. Treasury Department Federal Financial Assistance Listings 20.507
Federal Transit Cluster
FTA 5307 CARES Act 2020 – Agreement #CA-17, ID-2021-027
Federal Financial Assistance Listings 21.027
COVID-19 Coronavirus State and Local Fiscal Recovery Funds
Compliance Requirement – Procurement, Suspension, and Debarment Material Weakness in Internal Control over Compliance
Criteria:
Non‐federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200.
Condition:
We noted that while the City does have a purchasing policy, elements required by Uniform Guidance are absent from the policy. This created a situation where the City did not verify vendors were not suspended or debarred before entering into contract with that vendor. In addition, elements that are required to be included in contracts with vendors who are paid using federal monies were missing from the contracts.
Cause:
The City had not reviewed its procurement policy to ensure that the policy and contracts included the provisions that were required by the Uniform Guidance.
Effect:
While our testing noted no instances of noncompliance, the absence of internal controls over compliance as it relates to having a Uniform Guidance compliant policy, could lead the City to enter into covered transactions that are not compliant with federal regulations.
Questioned Costs:
None reported.
Context/Sampling:
Sampling was not used to test compliance of the Policy.
Repeat Finding from Prior Year(s):
No
Recommendation:
The City should review the applicable provisions of the CFR to ensure their written procurement policy is compliant with Uniform Guidance requirements.
Views of Responsible Officials:
The City concurs with the auditor’s findings.