Narragansett Bay Commission

Criteria – Effective May 14, 2022, recipients of Federal financial assistance programs for infrastructure projects that are subject to Buy America, Build America (BABA) Act requirements must ensure that when procuring and executing contracts for the infrastructure projects that the procurement documents and contracts include language to ensure compliance with BABA requirements. The recipient must also monitor contractor’s compliance with BABA requirements. Federal agencies may, under certain circumstances, issue waivers to the Made in America laws. Condition – During our test of controls and compliance with procurement requirements, we noted one infrastructure construction contract that was subject to the BABA requirements that did not have language to ensure compliance with BABA requirements and did not have a waiver indicating the requirements were not applicable. The contract was also not monitored for compliance with BABA requirements during fiscal year 2025. Cause – NBC was not aware that the infrastructure construction project funded by the Renewable Energy Research and Development cooperative agreement was not covered by an existing Federal agency waiver. Effect – The procurement documents and contract for the infrastructure construction project selected did not include language to ensure compliance with BABA requirements and the contract was not monitored for compliance with BABA requirements during the fiscal year. Questioned Costs – None. Recommendation – We recommend that NBC carefully review Federal awards and agreements to determine whether BABA requirements apply and if a Federal agency waiver is applicable. We also recommend that NBC implement procedures to ensure contractors are properly monitored when BABA requirements apply to an infrastructure construction project. Corrective Action Plan/Auditee Views – NBC acknowledges and concurs with the finding 2025-001 in the Fiscal Year 2025 Single Audit of the Narragansett Bay Commission conducted by Bacon & Company LLC. The Bucklin Point Wastewater Treatment Facility Digester Complex Improvements “the Project”) has been funded by state revolving fund loan proceeds from the Rhode Island Infrastructure Bank (RIIB) and a Department of Energy grant. NBC’s contracting for civil projects has procedures in place to ensure the inclusion of all applicable Federal requirements as it relates to the use of RIIB funds. Although the Project followed Federal requirements as it relates to RIIB funds, NBC did not have appropriate controls in place to verify that applicable construction contracts for the Project included additional Federal requirements related to compliance with the Build America, Buy America Act as ostensibly required by the Department of Energy grant agreement. NBC has subsequently verified and received certification from the Project’s prime contractor that the Project satisfies Build America, Buy America Act requirements. Corrective Action Plan: In order to ensure that all applicable grant agreement terms are satisfied, NBC has hired a grant administrator to centralize all grant related activities within the Finance Division. NBC intends to develop additional procedures in conjunction with the acceptance and execution of a grant agreement to accomplish the following: 1) Coordinate with applicable Cost Center (as grant recipient) to verify that NBC has the ability to comply with the terms of the grant agreement, and 2) Create a comprehensive checklist of key obligations, including reporting deadlines, allowable costs, matching requirements, and special conditions and verify continued compliance on a regular interval, and 3) Limit award of contracts, expenditure of funds for grant funded projects, and reimbursement requests for grant funds until grant administrator verifies compliance with applicable terms and conditions. Anticipated Completion Date – May 31, 2026 Contact Person - Kevin McDonald, Chief Financial Officer

Narragansett Bay Commission Corrective Action Plan For the Fiscal Year Ended June 30, 2025 NBC acknowledges and concurs with the finding 2025-001 in the Fiscal Year 2025 Single Audit of the Narragansett Bay Commission conducted by Bacon & Company LLC. The Bucklin Point Wastewater Treatment Facility Digester Complex Improvements “the Project”) has been funded by state revolving fund loan proceeds from the Rhode Island Infrastructure Bank (RIIB) and a Department of Energy grant. NBC’s contracting for civil projects has procedures in place to ensure the inclusion of all applicable Federal requirements as it relates to the use of RIIB funds. Although the Project followed Federal requirements as it relates to RIIB funds, NBC did not have appropriate controls in place to verify that applicable construction contracts for the Project included additional Federal requirements related to compliance with the Build America, Buy America Act as ostensibly required by the Department of Energy grant agreement. NBC has subsequently verified and received certification from the Project’s prime contractor that the Project satisfies Build America, Buy America Act requirements. Corrective Action Plan: In order to ensure that all applicable grant agreement terms are satisfied, NBC has hired a grant administrator to centralize all grant related activities within the Finance Division. NBC intends to develop additional procedures in conjunction with the acceptance and execution of a grant agreement to accomplish the following: 1) Coordinate with applicable Cost Center (as grant recipient) to verify that NBC has the ability to comply with the terms of the grant agreement, and 2) Create a comprehensive checklist of key obligations, including reporting deadlines, allowable costs, matching requirements, and special conditions and verify continued compliance on a regular interval, and 3) Limit award of contracts, expenditure of funds for grant funded projects, and reimbursement requests for grant funds until grant administrator verifies compliance with applicable terms and conditions. Anticipated Completion Date- May 31, 2026 Contact Person – Kevin McDonald, Chief Financial Officer

Criteria – When procuring and executing contracts for WIFIA funded projects, procurement documents and contracts must include language to ensure compliance with federal requirements. Condition – During our test of controls and compliance with procurement requirements, we noted the following: • Eight professional service contracts and related contract amendments did not include all the applicable language to ensure compliance with federal WIFIA requirements. Specifically, language related to federal lobbying restrictions was not included in the contracts and related amendments. • One construction contract did not include the required language to ensure compliance with federal WIFIA requirements. • Certain construction contracts tested included an older version of the WIFIA Borrower’s Guide to Federal Requirements Appendix, which outlines the Specification Package and Bid Contract Language. Cause – • NBC was not aware that certain language was required to be included in professional service contracts. • NBC did not adhere to established policies and procedures. • NBC had not updated the construction contracts to include the most current WIFIA contract language. Effect - NBC did not include in all the contract procurement documents selected for testing the required language to ensure compliance with federal program requirements. Questioned Costs – None. Recommendation – We recommend that NBC follow established procedures for all WIFIA funded contracts to ensure compliance with procurement requirements. The procedures should ensure that the applicable language related to compliance with federal program requirements is included in the contracts and procurement documents. We also recommend that NBC confirm that the most current WIFIA guidance is utilized when preparing WIFIA funded contracts and procurement documents. Corrective Action Plan/Auditee Views –- NBC will implement procedures for all WIFIA funded contracts to ensure compliance with applicable procurement requirements. Specifically, the procedures will ensure that the applicable language related to compliance with federal program requirements is included in the contracts and procurement documents. NBC will also confirm that the most current WIFIA guidance is utilized when preparing WIFIA funded contracts and procurement documents moving forward. NBC will also amend previously executed, but still active, professional service contracts to include the required contract language. Anticipated Completion Date – March 30, 2025 Contact Person - David Bowen, Director of Construction and Engineering

Narragansett Bay Commission Corrective Action Plan For the Fiscal Year Ended June 30, 2024 NBC will implement procedures for all WIFIA funded contracts to ensure compliance with applicable procurement requirements. Specifically, the procedures will ensure that the applicable language related to compliance with federal program requirements is included in the contracts and procurement documents. NBC will also confirm that the most current WIFIA guidance is utilized when preparing WIFIA funded contracts and procurement documents moving forward. NBC will also amend previously executed, but still active, professional service contracts to include the required contract language.Anticipated Completion Date – March 30, 2025Contact Person – David Bowen, Director of Construction and Engineering

2023-001

Criteria – When procuring and executing contracts for EPA funded projects, procurement documents must include language to ensure compliance with federal requirements. When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must also verify that the entity, as defined in 2 CFR Section 180.995 and agency adopting regulations, is not suspended, or debarred or otherwise excluded from participating in the transaction. “Covered transactions” include those contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR Section 180.220. Condition –NBC did not include in the professional service contract procurement documents selected for testing, the language to ensure compliance with federal program requirements. NBC also did not obtain a suspension/debarment certification for one of the professional service contracts selected for testing in accordance with established policies and procedures.Cause - NBC did not adhere to established policies and procedures to ensure compliance with the procurement and suspension and debarment requirements for the professional service contracts selected for testing. Effect - NBC did not include in the professional service contract procurement documents selected for testing, the language to ensure compliance with federal program requirements. NBC also awarded a professional service contract prior to obtaining a certification from that contractor that the entity was not debarred, suspended, or otherwise excluded. Questioned Costs – None. Recommendation – We recommend that NBC follow established procedures for all EPA funded contracts to ensure compliance with procurement and suspension and debarment requirements. The procedures should ensure that the language related to compliance with federal program requirements is included in the contracts and procurement documents and that certifications are obtained prior to contract execution to verify that an entity with which it plans to enter into a covered transaction is not debarred, suspended, or otherwise excluded.Corrective Action Plan/Auditee Views –- NBC will implement procedures for ensuring compliance with all the required contract language requirements and the federal suspension and debarment requirements for all federally funded contracts. Specifically, NBC will include the required contract language and certifications in professional service procurements and contracts and verify that the entity is not debarred, suspended or otherwise excluded from participating in federally funded contracts. NBC will also amend previously executed, but still active, professional service contracts to include the required contract language and certifications. Anticipated Completion Date – September 21, 2023Contact Person - Richard Bernier

Corrective Action Plan/Auditee Views –- NBC will implement procedures for ensuring compliance with all the required contract language requirements and the federal suspension and debarment requirements for all federally funded contracts. Specifically, NBC will include the required contract language and certifications in professional service procurements and contracts and verify that the entity is not debarred, suspended or otherwise excluded from participating in federally funded contracts. NBC will also amend previously executed, but still active, professional service contracts to include the required contract language and certifications. Anticipated Completion Date – September 21, 2023 Contact Person - Richard Bernier

2022-001

PROCUREMENT AND SUSPENSION AND DEBARMENT Criteria ? When procuring and executing contracts for WIFIA funded projects, procurement documents must include language to ensure compliance with federal requirements. When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must also verify that the entity, as defined in 2 CFR Section 180.995 and agency adopting regulations, is not suspended, or debarred or otherwise excluded from participating in the transaction. ?Covered transactions? include those contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR Section 180.220. Condition ?NBC did not include in the professional service procurement and contract documents selected for testing, the language to ensure compliance with federal requirements. Other than for construction contractors, NBC does not have specific procedures in place for procurement contracts for goods and services that are subject to the suspension and debarment requirements. Cause - NBC has only established policies and procedures for construction contractors to include the language in procurement documents to ensure compliance with federal requirements and for compliance with suspension and debarment requirements. NBC was unaware that these requirements apply to all WIFIA funded contracts for goods and services. Effect - NBC did not include in the professional service procurement and contract documents selected for testing, the language to ensure compliance with federal requirements. NBC also awarded the professional service contracts selected for testing, prior to verifying that the entity was not debarred, suspended, or otherwise excluded. Questioned Costs ? None. Recommendation ? We recommend that NBC implement procedures over compliance with procurement and suspension and debarment requirements for all WIFIA funded contracts. The procedures should ensure that the language related to compliance with federal requirements is included in the procurement documents and contracts and that a process is in place to verify that an entity with which it plans to enter into a covered transaction is not debarred, suspended, or otherwise excluded.

Corrective Action Plan/Auditee Views ? NBC will apply the procedures in place for construction contracts to all professional services contracts in excess of $25,000. These procedures include the contractor?s certification that they are not suspended or debarred or otherwise excluded from participating in the transaction at the time of contract award. In addition, prior to award, NBC shall confirm through the System for Award Management (SAM.gov) website that the contractor is not suspended, or debarred or otherwise excluded from participating in the transaction. Anticipated Completion Date - Implemented on September 8, 2022 Contact Person - Richard Bernier