MANITOWOC COUNTYLocal Government

Federal Agency: U.S. Department of Treasury Federal Program Name: COVID-19 Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Award Notification Number and Year: M6K8EDH1SLN3 - 2021 Award Period: March 3, 2021 – December 31, 2024 Compliance Requirement Affected: Suspension and Debarment Federal Agency: Department of Health and Human Services Federal Program Name: Opioid State Targeted Response Assistance Listing Number: 93.788 Federal Award Notification Number and Year: 435200-G23-36-310X3– 2023/2024 Award Period: September 30, 2022 – September 29, 2023 and September 30, 2023 – September 29, 2024 Section III – Federal Award Findings and Questioned Costs (CONTINUED) Compliance Requirement Affected: Suspension and Debarment Type of Finding: Material Weakness in Internal Control Over Compliance, (Other Matter) Criteria or Specific Requirement: 2 CFR 200 states that nonfederal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include 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 criteria as specified in 2 CFR section 180.220). All nonprocurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. 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, 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. Condition: The County has established policies and procedures in place including related controls over suspension and debarment. However, the policies and procedures were not consistently followed to ensure compliance with requirements of Uniform Guidance. Questioned Costs: None Context: While performing audit procedures, it was noted that the County did not follow established policies regarding suspension and debarment and procedures to verify compliance were not documented. Seven transactions out of a sample of seven transactions were lacking appropriate documentation. Cause: While the County has policies to ensure they do not use suspended or disbarred vendor, there was no documentation maintained to support verification before entering into a covered transaction. Effect: The County could contract with a suspended or debarred vendor. Repeat Finding: Repeat of Finding 2022-002. Recommendation: We recommend the County follow their suspension and debarment policy which includes maintaining documentation related to suspension and debarment for covered transactions. Views of Responsible Officials: There is no disagreement with the finding.

Control Deficiency 2022-002: Suspension and Debarment Federal Agency: U.S. Department of Treasury Federal Program Names: COVID-19 Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Numbers: 21.027 Award Periods: March 3, 2021 ? December 31, 2024 Type of Finding: Material Weakness in Internal Control Over Compliance Condition: The County has established policies and procedures in place including related controls over suspension and debarment. However, the policies and procedures were not consistently followed to ensure compliance with requirements of Uniform Guidance. Criteria or Specific Requirement: 2 CFR 200 states that nonfederal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. ?Covered transactions? include 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). All non procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. 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, 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. Context: While performing audit procedures, it was noted that the County did not follow established policies regarding suspension and debarment and procedures to verify compliance were not documented. Eight transactions out of a sample of eight transactions were lacking appropriate documentation. Cause: While the County has policies to ensure they do not use suspended or disbarred vendor, there was no documentation maintained to support verification before entering into a covered transaction. Effect: The County could contract with a suspended or debarred vendor. Repeat Finding: No Recommendation: We recommend the County follow their suspension and debarment policy which includes maintaining documentation related to suspension and debarment for covered transactions. Views of Responsible Officials and Corrective Action Plan: There is no disagreement with the finding. The County immediately began reviewing it?s policy related to suspension and debarment and is reviewing procedures to ensure that requirements are consistently followed in future years.