Finding Text
Non-compliance with Internal Procurement Policy (Material Weakness, Material Non-Compliance)
Capital Fund Program – Assistance Listing No. 14.872; Grant Period - Fiscal Year-Ended September 30, 2023
Criteria
Public Housing Authorities (PHA’s) should procure federally-funded contracts in accordance with a formal, documented internal Procurement Policy based on federal procurement guidelines, including HUD Handbook 7460.8, Rev. 2, Procurement Handbook for Public Housing Agencies. PHA’s are prohibited from awarding contracts to contractors who have been suspended or debarred from performing contracts funded with federal subsidies. Additionally, the Authority’s Procurement Policy dictates full compliance with the Handbook. PHA’s are permitted to comply with the applicable regulations by A) searching the Excluded Parties List System (EPLS) for the prospective contractor, or B) attaining a certified statement from the contractor in which the contractor certifies against suspension or debarment.
Condition and Perspective
Two Capital Fund Program funded contract awards were sampled. One applicable contact, awarded in the amount of $481,610, did not contain the contractor’s certification against suspension and debarment or evidence that the EPLS was searched for the contractor.
Questioned Costs – None
Cause
Lack of knowledge of federal procurement requirements among applicable personnel administering contract award.
Effect
Non-compliance with the Authority’s Procurement Policy and federal regulations.
Recommendation
We recommend that the Authority attain certification against suspension and debarment or search the EPLS for prospective contractors prior to awarding contracts.
Management’s Response
The Authority will attain certification against suspension and debarment or search the EPLS for prospective contractors prior to awarding contracts. The Authority’s Executive Director, Erial Branch, has assumed the responsibility of executing this corrective action as of July 1, 2024.