CITY OF FARMERSVILLE

"Finding 2019-001 Procurement (CFDA #10.760 ? Water and Waste Disposal Systems for Rural Communities) Condition: The City of Farmersville, California does not have written procurement procedures which reflect applicable state, local, and tribal laws and regulations which also conform to the applicable federal law and standards identified in the Uniform Guidance. Criteria: 2 CFR Part 200, Part D (Uniform Guidance) Section 200.318 requires that a non-federal entity use and maintain its own documented procurement procedures which reflect applicable state, local, and tribal laws and regulations, provided that the procurements conform to applicable federal law and standards identified in the Uniform Guidance. Cause: The City of Farmersville, California utilizes an outside third-party engineering firm to act as the City Engineer. This includes, as designated, the administration and oversight of projects and related services provided to the City from other third-party contractors, including procurement of significant construction related projects. The City employs the specialized services of the third-party engineering firm to ensure compliance with applicable federal and state law, including those related to procurement, but was not aware of the requirement to also maintain and utilize their own written procurement procedures. Effect: As a result of our audit, we have determined that the City followed all applicable procurement compliance requirements as it relates to the grant under CFDA #10.760, with the exception of maintaining and using their own written procurement policy in accordance with applicable federal and state law. The ultimate lack of adhering to documented procurement standards in accordance with applicable state, local, and tribal law could increase the risk of goods and services being procured through method not in accordance with applicable laws and regulations. Improper procurement of goods and services could lead to a suspension of grant funding and/or other unallowable costs. Recommendation: We recommend that the City create, adopt, and utilize its own written procurement policy and related procedures which reflect applicable state, local, and tribal laws and regulations that are in accordance with applicable federal law and standards identified in 2 CFR 200.318 ? 326 (Uniform Guidance)."

The City acknowledges that during the 2019 Fiscal Year that the City did not maintain a written procurement procedure that was updated to reflect applicable state, local, and tribal laws and regulations which also conform to the applicable federal law and standards identified in the Uniform Guidance. However, the City did follow proper procurement standards for all Federal funded and non-Federal funded procurement during this time. Furthermore, the City was undergoing evaluation and background work during that same period to update said procurement policy. The policy is in final draft form at this writing and the City plans to have the updated policy and applicable municipal ode section finalized and approved by Farmersville City Council by March of 2020. The new procurement policy prominently features a section devoted to compliance with 2 CFR Part 200 along with other improvements aligned with best practices et forth by the GFOA and procurement practice standards by the NIGP.