HFH of Douglas CountyNon-Profit

Federal Agency: U.S. Department of Agriculture Federal Program Title: Rural Housing Site Loans Federal Assistance Listing Number: 10.411 Federal Award and Identification Number and Year: 269813615 - 2024 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Period: 07/03/2024-07/03/2029 Type of Finding: • Significant Deficiency in Internal Control over Major Federal Programs Criteria: 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. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA) and available at https://www.sam.gov/portal/public/SAM/ (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300). Condition: During our testing we noted sam.gov searches for our selections but no documentation was retained to support that the search was performed prior to the procurement date for the vendors selected. Also noted there was no review performed over the search after the search was made. Questioned Costs: N/A Context: Two of the two selections did not have any documentation retained to support suspension/debarment procedures were followed until after entering into the covered transaction as the policy in place only requires the search be performed. Cause: Management was aware of the suspension and debarment requirements dictated by the Uniform Guidance; however, the client's policy is not formally documented and does not include the required time frame. Effect: Potential for the Organization to do business with entities that are suspended or debarred which is not allowed per Uniform Guidance. Repeat Finding: N/A Recommendation: The Organization should implement a formal internal control policy over the suspension and debarment rules and follow them before entering into a covered transaction with another entity and that this search is reviewed. Views of Responsible Officials: The Organization will implement and follow a suspension and debarment policy in accordance with 2 CFR section 180.995 and specify the review of a vendor must be done prior to entering into a covered transaction.