Rocky River City School District

2 CFR 180.305 states that Non-Federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred or whose principals are suspended or debarred. ?Covered transactions? include those procurement contracts for goods and services awarded under a nonprocurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other specified criteria. 2 CFR ? section 180.220 of the government-wide nonprocurement debarment and suspension guidance contains those additional limited circumstances. All nonprocurement transactions (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions. When a non-Federal entity enters into a covered transaction with an entity at a lower tier, the non-Federal entity must verify that the entity is not suspended or debarred or otherwise excluded. The verification can be accomplished by checking the System for Award Management (SAM), collecting a certification from the entity or adding a clause or condition to the covered transactions with that entity. During fiscal year 2020, the District expended $240,000 in covered transactions to Monarch Center of Autism for tuition for students attending and receiving special education services. The District did not maintain evidence of verifying the vendor was not suspended or disbarred by checking the SAM, collecting the certification or adding the aforementioned clause or condition to the covered transaction with the vendor at the time of entering the purchase. The District subsequently determined the vendor was not suspended or debarred and was eligible for federal funds. Failure to properly check the SAM, collecting a certification or adding the aforementioned clause may result in the District conducting business with suspended or debarred vendors. Prior to contracting with vendors that will be paid with federal funds, we recommend the District maintain evidence of verifying that vendors are not suspended or debarred by checking the SAM, collecting the certification from the entity or adding the aforementioned clause or condition to the covered transactions with a vendor at the time of entering a contract where more than $25,000 in federal funds will be expended.