City of FairburnLocal Government

Program: Coronavirus State and Local Fiscal Recovery Fund – Federal Assistance Listing No. 21.027 Criteria: 49 CFR Part 18.36 requires grant recipients to follow the procurement standards established by their state and their own policies as long as those standards meet federal requirements. The City’s procurement standards meet Federal and State requirements. Also, in compliance with the guidance set forth in the grant agreements and with the OMB A-102 Common Rule (which applies to grants and cooperative agreements) Attachment 1 (d), all recipients are required, during the procurement process, to ensure vendors are not cited as suspended or debarred or otherwise excluded from participation in federally funded contracts. This can be accomplished by checking www.sam.gov maintained by the General Services Administration, collecting a certification from the entity, or adding a clause or condition to the contract with the vendor. Condition: During our testing of the Coronavirus State and Local Fiscal Recovery Fund (“ARPA”), it was discovered that the City did not verify whether two (2) contractors were noted as excluded on the federal government’s suspension and debarred lists and did not include the appropriate language in the contracts with those contractors. Possible Effects: The City could unintentionally enter into a noncompliant contract and be forced to reimburse the federal government for all expenditures made with a debarred or suspended contractor. Based on a review of the excluded parties listing, the contractors in this case were not included as suspended or debarred. Questioned Costs: None. Context: Two (2) contractors paid with ARPA funds were not noted as having the proper suspension and debarment certification in their contracts; and there was no documentation of the City’s review of the excluded party listing. Cause: The City did not adhere to its established procurement policy, and did not obtain suspension and debarment certifications from four contractors. Repeat Finding: The is a repeat finding from September 30, 2023, finding 2023-002.

Finding 2023 – 002 – Procurement, Suspension, and Debarment Program: Coronavirus State and Local Fiscal Recovery Fund – Federal Assistance Listing No. 21.027 Criteria: 49 CFR Part 18.36 requires grant recipients to follow the procurement standards established by their state and their own policies as long as those standards meet federal requirements. The City’s procurement standards meet Federal and State requirements. Also, in compliance with the guidance set forth in the grant agreements and with the OMB A-102 Common Rule (which applies to grants and cooperative agreements) Attachment 1 (d), all recipients are required, during the procurement process, to ensure vendors are not cited as suspended or debarred or otherwise excluded from participation in federally funded contracts. This can be accomplished by checking www.sam.gov maintained by the General Services Administration, collecting a certification from the entity, or adding a clause or condition to the contract with the vendor. Condition: During our testing of the Coronavirus State and Local Fiscal Recovery Fund (“ARPA”), it was discovered that the City did not verify whether four contractors were noted as excluded on the federal government’s suspension and debarred lists and did not include the appropriate language in the contracts with those contractors. Additionally, the City did not adhere to its established Procurement Policy and one contactor was engaged without any formal approval, quote or a bid. Possible Effects: The City could unintentionally enter into a noncompliant contract and be forced to reimburse the federal government for all expenditures made with a debarred or suspended contractor, or a contractor that the City’s governance would deem unsuitable were the proper policy followed. Based on a review of the excluded parties listing, the contractors in this case were not included as suspended or debarred. Questioned Costs: $25,000. Context: Four (4) contractors paid with ARPA funds were not noted as having the proper suspension and debarment certification in their contracts; and there was no documentation of the City’s review of the excluded party listing. One (1) contractor paid with ARPA funds was engaged without any formal approval, quote or a bid. Cause: The City did not adhere to its established Procurement Policy, and did not obtain suspension and debarment certifications from four contractors. Repeat Finding: The is a repeat finding from September 30, 2022, finding 2022-002, wherein the same weakness in controls over Suspension and Debarment were noted in testing a separate federal program.

Criteria: 49 CFR Part 18.36 requires grant recipients to follow the procurement standards established by their state and their own policies as long as those standards meet federal requirements. The City?s procurement standards meet Federal and State requirements. Also, in compliance with the guidance set forth in the grant agreements and with the OMB A-102 Common Rule (which applies to grants and cooperative agreements) Attachment 1 (d), all recipients are required, during the procurement process, to ensure vendors are not cited as suspended or debarred or otherwise excluded from participation in federally funded contracts. This can be accomplished by checking the www.sam.gov maintained by the General Services Administration, collecting a certification from the entity, or adding a clause or condition to the contract with the vendor. Condition: During our testing of the Highway Planning and Construction program, it was discovered that the City did not verify whether two contractors were noted as excluded on the Federal government?s suspension and debarred lists and did not include the appropriate language in the contracts with those contractors. Possible Effects: The City could unintentionally enter into a noncompliant contract and be forced to reimburse the Federal government for all expenditures made with a debarred or suspended contractor. Based on a review of the excluded parties listing, the contractors in this case were not included as suspended or debarred. Questioned Costs: None. Context: Two (2) contractors used with Highway Planning and Construction funds were not noted as having the proper suspension and debarment certification in their contracts and there was no documentation of the City?s review of the excluded party listing. Cause: The City did not obtain suspension and debarment certifications from two contractors. Repeat Finding: The is a repeat finding from September 30, 2021, finding 2021-003. Recommendation: We recommend the City establish procedures to properly include all suspension and debarment clauses in the contracts involving grant or cooperative agreement funds. Auditee?s Response: The City agrees with the recommendation above and has established a formal process to ensure that all required grant related information is included in the contracts in the future.

Program: Highway Planning and Construction Cluster ? Federal Assistance Listing No. 20.205 Criteria: 49 CFR Part 18.36 requires grant recipients to follow the procurement standards established by their state and their own policies as long as those standards meet federal requirements. The City?s procurement standards meet Federal and State requirements. Also, in compliance with the guidance set forth in the grant agreements and with the OMB A-102 Common Rule (which applies to grants and cooperative agreements) Attachment 1 (d), all recipients are required, during the procurement process, to ensure vendors are not cited as suspended or debarred or otherwise excluded from participation in federally funded contracts. This can be accomplished by checking the www.sam.gov maintained by the General Services Administration, collecting a certification from the entity, or adding a clause or condition to the contract with the vendor. Condition: During our testing of the Highway Planning and Construction program, it was discovered that the City did not verify whether two contractors were noted as excluded on the Federal government?s suspension and debarred lists and did not include the appropriate language in the contracts with those contractors. Possible Effects: The City could unintentionally enter into a noncompliant contract and be forced to reimburse the Federal government for all expenditures made with a debarred or suspended contractor. Based on a review of the excluded parties listing, the contractors in this case were not included as suspended or debarred. Questioned Costs: None. Context: Two (2) contractors used with Highway Planning and Construction funds were not noted as having the proper suspension and debarment certification in their contracts and there was no documentation of the City?s review of the excluded party listing. Cause: The City did not obtain suspension and debarment certifications from two contractors. Recommendation: We recommend the City establish procedures to properly include all suspension and debarment clauses in the contracts involving grant or cooperative agreement funds. Auditee?s Response: The City agrees with the recommendation above and has established a formal process to ensure that all required grant related information is included in the contracts in the future.