EIN: 351438747
UEI: LMSLH9N5PBE5
Audited by: INDIANA STATE BOARD OF ACCOUNTS
Oversight agency: 20 [Department of Transportation]
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Data as of August 28, 2026
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on September 19, 2023. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by March 19, 2024 (894 days ago).
What is a management decision? →FAC accepted this audit on October 23, 2022 — management decision was due April 23, 2023.
FINDING 2021-001 Subject: Consolidated Rail Infrastructure and Safety Improvements - Procurement and Suspension and Debarment Federal Agency: Department of Transportation Federal Program: Consolidated Rail Infrastructure and Safety Improvements Assistance Listings Number: 20.325 Federal Award Number and Year (or Other Identifying Number): 69A36520401160CRSIN Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context The Authority had not designed and implemented an effective internal control system to ensure compliance with requirements related to the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Procurement Federal regulations allow for informal procurement methods when the value of the procurement for property or services does not exceed the simplified acquisition threshold. This informal process allows for methods other than the formal bid process. The informal process is divided between two methods based on thresholds. Micro-purchases, typically for those purchases $10,000 and under, and small purchase procedures for those purchases above the micropurchase threshold, but below the simplified acquisition threshold. Micro-purchases may be awarded without soliciting competitive price rate quotations. If small purchase procedures are used, then price or rate quotations must be obtained from an adequate number of qualified sources. The Authority did not obtain price or rate quotes for the sole vendor that was less than the simplified acquisition threshold, but exceeded the $10,000 micro-purchase threshold. Documentation detailing the history of the procurement, which must include the reason for the procurement method used, was not available for audit. Additionally, the Authority indicated that the circumstances required a single source purchase method, which would be allowed under noncompetitive procurement. However, they did not provide documentation that would support the use of an alternative method. Conflict of Interest Policy The Authority's policies did not include standards of conduct covering conflicts of interest or to govern the actions of its employees engaged in selection, award and administration of contracts supported by federal awards. Suspension and Debarment The Authority's compliance with Suspension and Debarment requirements could not be verified. The documentation presented for audit for all three contracts selected for testing was not sufficient to determine that SAM exclusions were checked prior to entering into the covered transaction. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.318 states in part: "(a) The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in ?? 200.317 through 200.327. . . . (c)(1) The non-Federal entity must maintain written standards of conduct covering conflicts of interest and governing the actions of its employees engaged in the selection, award and administration of contracts. . . . (i) The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. . . ." 2 CFR 200.320 states in part: "The non-Federal entity must have and use documented procurement procedures, consistent with the standards of this section and ?? 200.317, 200.318, and 200.319 for any of the following methods of procurement used for the acquisition of property or services required under a Federal award or sub-award. (a) Informal procurement methods. When the value of the procurement for property or services under a Federal award does not exceed the simplified acquisition threshold (SAT), as defined in ? 200.1, or a lower threshold established by a non-Federal entity, formal procurement methods are not required. The non-Federal entity may use informal procurement methods to expedite the completion of its transactions and minimize the associated administrative burden and cost. The informal methods used for procurement of property or services at or below the SAT include: . . . (2) Small purchases - (i) Small purchase procedures. The acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity. . . ." 2 CFR 180.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking SAM Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person." Cause Management had not established a system of internal control that would have ensured compliance with the Procurement and Suspension and Debarment compliance requirement. Effect The failure to design and implement an effective control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement and the Procurement and Suspension and Debarment compliance requirement could have resulted in the loss of federal funds to the Authority. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the Authority's management establish a system of internal control to ensure compliance and comply with the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Show full finding ▾Hide full finding ▴FINDING 2021-001 Subject: Consolidated Rail Infrastructure and Safety Improvements - Procurement and Suspension and Debarment Federal Agency: Department of Transportation Federal Program: Consolidated Rail Infrastructure and Safety Improvements Assistance Listings Number: 20.325 Federal Award Number and Year (or Other Identifying Number): 69A36520401160CRSIN Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context The Authority had not designed and implemented an effective internal control system to ensure compliance with requirements related to the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Procurement Federal regulations allow for informal procurement methods when the value of the procurement for property or services does not exceed the simplified acquisition threshold. This informal process allows for methods other than the formal bid process. The informal process is divided between two methods based on thresholds. Micro-purchases, typically for those purchases $10,000 and under, and small purchase procedures for those purchases above the micropurchase threshold, but below the simplified acquisition threshold. Micro-purchases may be awarded without soliciting competitive price rate quotations. If small purchase procedures are used, then price or rate quotations must be obtained from an adequate number of qualified sources. The Authority did not obtain price or rate quotes for the sole vendor that was less than the simplified acquisition threshold, but exceeded the $10,000 micro-purchase threshold. Documentation detailing the history of the procurement, which must include the reason for the procurement method used, was not available for audit. Additionally, the Authority indicated that the circumstances required a single source purchase method, which would be allowed under noncompetitive procurement. However, they did not provide documentation that would support the use of an alternative method. Conflict of Interest Policy The Authority's policies did not include standards of conduct covering conflicts of interest or to govern the actions of its employees engaged in selection, award and administration of contracts supported by federal awards. Suspension and Debarment The Authority's compliance with Suspension and Debarment requirements could not be verified. The documentation presented for audit for all three contracts selected for testing was not sufficient to determine that SAM exclusions were checked prior to entering into the covered transaction. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.318 states in part: "(a) The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in ?? 200.317 through 200.327. . . . (c)(1) The non-Federal entity must maintain written standards of conduct covering conflicts of interest and governing the actions of its employees engaged in the selection, award and administration of contracts. . . . (i) The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. . . ." 2 CFR 200.320 states in part: "The non-Federal entity must have and use documented procurement procedures, consistent with the standards of this section and ?? 200.317, 200.318, and 200.319 for any of the following methods of procurement used for the acquisition of property or services required under a Federal award or sub-award. (a) Informal procurement methods. When the value of the procurement for property or services under a Federal award does not exceed the simplified acquisition threshold (SAT), as defined in ? 200.1, or a lower threshold established by a non-Federal entity, formal procurement methods are not required. The non-Federal entity may use informal procurement methods to expedite the completion of its transactions and minimize the associated administrative burden and cost. The informal methods used for procurement of property or services at or below the SAT include: . . . (2) Small purchases - (i) Small purchase procedures. The acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity. . . ." 2 CFR 180.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking SAM Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person." Cause Management had not established a system of internal control that would have ensured compliance with the Procurement and Suspension and Debarment compliance requirement. Effect The failure to design and implement an effective control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement and the Procurement and Suspension and Debarment compliance requirement could have resulted in the loss of federal funds to the Authority. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the Authority's management establish a system of internal control to ensure compliance and comply with the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2021-001 Contact Person Responsible for Corrective Action: Adam Robillard, General Manager Contact Phone Number: (812) 273-4248 Views of Responsible Official: The City of Madison Port Authority (CMPA) does not disagree with the findings however, we would like to add that the verification had indeed been conducted for suspension and debarment by our subcontractor designated to perform those duties. The material provided to the SBOA was not found satisfactory to meet the specific documentation requirements. Description of Corrective Action Plan: CMPA will design and implement an effective internal control system to comply with procurement and suspension and debarment requirements. Anticipated Completion Date: 10/15/2022
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