Metropolitan Washington Council of GovernmentsLocal Government

Reference Number: 2023-001 Prior Year Finding: No Federal Agency: Pass-Through Agency: U.S. Department of Homeland Security Government of the District of Columbia Homeland Security and Emergency Management Agency Federal Program: Securing the Cities Program Assistance Listing Number: 97.106 Award Number and Year: 17STC117-02, 20STC117-01 (9/1/2021-8/31/2023) Compliance Requirement: Suspension and Debarment Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria or specific requirement: Compliance: 2 CFR 200.214 Suspension and Debarment restricts awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. 2 CFR 180.300 states that an entity may determine suspension and debarment status by: (a) Checking SAM (System for Award Management) Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: 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 comply 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). Condition: MWCOG did not determine the suspension and debarment status of vendors with expenditures exceeding $25,000 as required by federal regulations. Context: The suspension and debarment status for 2 of 2 vendors was not documented. Questioned costs: There are no questioned costs related to this finding as the vendors were not federally suspended or debarred. Cause: MWCOG’s internal controls over suspension and debarment are not sufficient to ensure that all vendors’ suspension and debarment status is documented. Effect: Failure to verify and document the suspension and debarment status of vendors may result in MWCOG issuing payments to vendors that are suspended or debarred and not authorized to provide services under the program. Recommendation: MWCOG should ensure policies and procedures include the three options for determining suspension and debarment status listed in 2 CFR 180.300 and that controls are sufficient to ensure that the suspension and debarment status is verified for all vendors. Views of responsible officials: MWCOG will ensure that all vendors’ suspension and debarment status be documented in the procurement files at the time of contract with the vendors.

Program Identification: Rail Fixed Guideway Public Transportation System State Safety Oversight Formula Grant Program, CFDA Number 20.528; Department of Transportation; Award period: year ended June 30, 2019; No pass-through entity. Criteria: Code of Federal Regulations 2 CFR 200.502, Basis for determining Federal awards expended. ?The determination of when a Federal award is expended must be based on when the activity related to the Federal award occurs. Generally, the activity pertains to events that require the non-Federal entity to comply with Federal statutes, regulations, and the terms and conditions of Federal awards, such as: expenditure/expense transactions associated with awards including grants, cost-reimbursement contracts under the FAR, compacts with Indian Tribes, cooperative agreements, and direct appropriations; the disbursement of funds to subrecipients; the use of loan proceeds under loan and loan guarantee programs; the receipt of property; the receipt of surplus property; the receipt or use of program income; the distribution or use of food commodities; the disbursement of amounts entitling the non-Federal entity to an interest subsidy; and the period when insurance is in force.? Requirement: Recipients of federal awards are required to track and maintain a complete and accurate accounting of expenditures associated with federal awards. These expenditures are required to be summarized and presented within the Schedule of Expenditures of Federal Awards (Schedule) in the correct period. Condition: The Schedule originally provided improperly overstated federal expenditures by $116,000 for the Rail Fixed Guideway Public Transportation System State Safety Oversight Formula Grant Program, CFDA Number 20.528. Context: The expenditures were not properly presented on the original Schedule provided for the Rail Fixed Guideway Public Transportation System State Safety Oversight Formula Grant Program, CFDA Number 20.528. Cause: There was lack of supervisory review of expenditures for the Schedule that was provided which resulted in expenditures being recorded in the improper period. Effect: The potential exists for federal expenditures to not be properly reflected within the Schedule. As a result of failing to properly record this item, MWCOG could fail to report the proper amounts of federal expenditures associated with specific grants. Questioned Costs: MWCOG improperly recognized $116,000 in federal expenditures during fiscal year 2019, which should have been for fiscal year 2020. Recommendation: We recommend MWCOG implement procedures to review all invoices to ensure expenditures are recorded in the proper period and properly presented on the Schedule.

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