Specifically, Ohios political subdivisions have The August 2020 installment of our data series discussed how to collect data and provided examples of how municipal employees can use that data to identify waste and possible fraud. Further, the individuals who review and approve invoices must know the contract terms, conditions and specifications. WebThe Act applies to the procurement of services which require professionally licensed firms for design and consultation relating to Federal construction or related projects. %%EOF Payment reviews are a key part of contract administration, and insufficient reviews leave your jurisdiction vulnerable to improper or questionable payments to vendors. The record retention requirements for ARP/CSLFRF-related records are more stringent than those imposed under State law. Further, costs must be reasonable and allocable as outlined in 2 CFR 200.404 and 2 CFR 200.405. It is easy to become overwhelmed when determining how best to use this untapped resource. Review the contract and be familiar with its terms. These risk assessments may include factors such as prior experience in managing Federal funds, previous audits, personnel, and policies or procedures for award execution and oversight. To avoid such pitfalls, your jurisdiction should approve and implement a policy outlining how to procure towing and storage services, even though it is exempt from Chapter 30B. Ongoing monitoring of any given subrecipient should reflect its assessed risk and include monitoring, identification of deficiencies, and follow-up to ensure appropriate remediation. Still, working with data at all levels of government can be challenging. If procurement is only possible through non-competitive methods, municipalities will need to justify use of a non-competitive procurement process, only permissible when one of the following conditions are met: the item is below the micro-purchase threshold established by the municipality; the item is only available from a single source; the public exigency or emergency will not permit a delay from publicizing a competitive solicitation; or after solicitation of a number of sources, competition is determined inadequate. Establish attainable program goals and targets, and understand which expenditures are allowable under federal law. For example, a municipality may have an existing contract for providing workforce development services that they wish to use starting July 1, 2021, but the contract expired in March 2021. In most instances, a vendor audit is a collaborative effort between the vendor and the government entity. A compliance audit is the overarching term for ensuring that a vendor is complying with the terms of a contract. Capital Funds Project website. If the data is not in one of these formats, do not despair! Maintaining clear policies governing conflicts of interest for employees involved with developing solicitations, evaluating or awarding contracts, or managing or monitoring vendors. The idea of using data can be intimidating, and you might think you need to be a data expert to analyze or use data. ApplyingBenfordsLaw is another way to find outliers in your data that should be flagged for further review. We hope that this article, along with the other articles in our series on data analytics, helps you feel more confident in your ability to collect and analyze data. Federal procurement rules not applicable to certain ARPA-funded projects Tuesday, August 30, 2022. One key oversight tool is the vendor audit. The right person to review an invoice depends on the type of contract, including its size and complexity. Jurisdictions therefore must dedicate staff to evaluate documents and completed work reports from contractors to make sure that they have followed the contract before issuing payment. Two signature programs of the ARPA are the Coronavirus State Fiscal Recovery Fund (SFRF) and the Coronavirus Local Fiscal Recovery Fund (LFRF). If you need assistance, please contact the Office of the Inspector General. Within that broad term, common types of vendor audits (ranging from a less-narrow scope to a more-narrow scope) include process compliance audits, financial compliance audits, regulatory compliance audits, general compliance audits, and fraud audits. A .mass.gov website belongs to an official government organization in Massachusetts. The following is a sample policy to address any program income: Note that there are some grey areas related to how to identify program income, particularly fees for services assessed for water, sewer, or broadband assets constructed or improved with ARP/CSLFRF monies. You must ensure that the vendors you are doing business with are legitimate and responsible. Each category of cost should be treated consistently in like circumstances as direct or indirect, and recipients may not charge the same administrative costs to both direct and indirect cost categories, or to other programs. bWlLLiBg`x m It also must be generally recognized as ordinary and necessary for the proper and efficient performance of the ARP/CSLFRF grant award. As mentioned below, we are working on detailed roadmaps to help local governments know when/how to implement each policy based on specific expenditure decisions. Below are a few examples of the range of schemes that vendors may engage in. There are no requirements for contracts or expenditures of less than $10,000. However, using ARPA funds for contracts in excess of $10,000 triggers the mandatory contract provisions in 2 CFR Part 200, Appendix II. Most contract provisions are required only on those exceeding $100,000 or those for construction projects of any amount. This makes bid manipulation more difficult. WebThe Buy American requirements apply to all Recovery Act funds used for a project for the construction, alteration, maintenance, or repair of a public building or public work. To facilitate grant management, jurisdictions should develop clear expectations for grant programs and include this language in grant awards. Make sure the vendor is legitimate, responsible, has acceptable references and is properly registered to conduct business in Massachusetts. [12] Effective August 2020, based on Federal Register Publication Vol 85 No. By now, Ohio municipalities, counties, and townships are well aware that the federal government passed significant coronavirus relief funding in the American Rescue Plan Act (ARPA). When the jurisdiction tried to reduce the quantity of future deliveries, the vendor threatened to charge the jurisdiction a higher non-bulk rate. Quality of contracts and documents: identify vendors with poorly written contracts or payment documents. Wherever practicable, such records should be collected, transmitted, and stored in open and machine-readable formats. Data is everywhere, and every function a government performs can generate valuable data. Web Must have documented procurement actions using strategic sourcing, shared services, and other similar procurement arrangements to support competition. As part of those procedures, a local government should identify the core team who will perform the review processes and implement necessary controls. It also will identify grey areas that may require further legal scrutiny before finalizing expenditure decisions. We are working on detailed roadmaps to implementing these UG policies and templates for different potential expenditure items. A lock icon or https:// means youve safely connected to the official website. T:919.600.7874. However, the audit team should be careful not to become too friendly with their auditees. For example, you can analyze vendor performance using vendor quotations, proposal evaluations and past invoices. The majority of these goods and services are purchased using the Uniform Procurement Act, M.G.L. Data also can help identify vulnerabilities or concerns about fraud, waste or abuse. If a local government received less than $10 million in CSLFRF funds, it may take the Written procedures that do not meet UG standards must be revised to include these State Government websites value user privacy. Regulatory compliance audits determine whether the vendor is following all of the laws and regulations relevant to the goods and services they provide (e.g., environmental regulations). For that reason it is not included in the Drop-in document. Exceptions to requirements for small purchase or formal method competitive rules. ARPA-funded projects must also adhere to North Carolina Come with your questions and share your experiences and insights with colleagues across the State. Check to make sure that the supplies and services that the vendor provided met the contract terms and followed the defined scope of work. To ensure that jurisdictions get the supplies and services they need and to combat fraud, waste and abuse, it is essential that jurisdictions carefully review all vendor payment requests. Without thinking much about it, you gathered data and made a decision based on that data. Recipients that receive an aggregate amount of federal financial assistance in a given fiscal year that exceeds the Single Audit threshold are subject to the requirements in 2 CFR 200 Subpart F, Audit Requirements, unless otherwise specified in program-specific guidance. [3] Treasury reminds that recipients and subrecipients of this funding are required to have documented processes and procedures governing procurement and contracting under this award.[4]. When was the last time your client revised their procurement contracts? Ensuring that the contract structure is appropriate for the goods and/or services rendered, that prices are fair based on an independent cost or price analysis, and that a cost-plus-percentage-of-cost method is not used for federally-funded contracts. The audit team should also obtain buy-in and support from the vendors management before initiating the audit. The audit team must explore and understand the vendors policies and procedures to adequately perform their assessment. Treasury may request that recipients submit data for post-award compliance reviews, including information such as a narrative describing their Title VI compliance status. A lock icon ( The audit scope and appropriate approach depend on the type of audit performed. Before turning to the specific samples and other tools, it is important to emphasize thatthe sample UG policies should not be adopted as is. Each of the considerations above, as well as operation and maintenance What is the difference between Suspension and Debarment? The prevention and detection of fraud, waste and abuse of public funds always an important issue for government entities is even more critical now that jurisdictions are receiving billions of additional dollars in ARPA funding. (A) statutory restrictions under the ARPA, which include: offsetting a reduction in net tax revenue, and deposits into pension funds, and (B) other restrictions on use, which include: debt service and replenishing reserves, settlements and judgments, and general restrictions. (See Final Rule pp. This data should alert you to the possibility that the employee may be committing fraud and that you should investigate the matter further. If you need assistance, please contact the Office of the Inspector General. When was the last time your client revised their procurement contracts? However, Chapter 30B does not apply to federally funded procurements if following Chapter 30B would conflict with federal laws or regulations. The team needs the vendors support in order to get access to records and personnel, as well as to take action on findings. For example, someone from the public works department who supervises roadway paving should know whether the contractor completed the work and used the correct materials. A different person should have the authority to approve payment, and that person must also know the terms of the contract to effectively review invoices. Once the data has been transformed into auser-friendlyformat, it can be used in a variety of ways to assist with future procurements and other business decisions. The contract did not entitle the vendor to charge an administrative fee and the housing authority rightly refused to pay it. Please limit your input to 500 characters. External sources are another area from which data can be gathered and used in an analysis. All rights reserved. hWoHWcORPKt.u8 -fA zA^%hq0)`Q9^2 B $BJ*'xdg.|vOhRRFa)`q:e8^0^0^0^0^ 6fn?iTDuHG?=t1Ax twx3Oy!/%G}KoW%0!,k69\=nl The vendor claimed that the lower per-unit price was only for bulk purchases. People have varying levels of comfort and expertise in using data, and these articles are designed to assist beginners and experts alike. See 2 C.F.R. Please let us know how we can improve this page. If you would like to continue helping us improve Mass.gov, join our user panel to test new features for the site. Requirements for bidders and contractors under this order are explained in the specifications. Note: This language must be included in the Bid solicitation. 2 CFR 200.317 - 2 CFR 200.327. This page is located more than 3 levels deep within a topic. Some information may be in spreadsheets or in existing databases or electronic systems. Has the vendor demonstrated capacity and financial responsibility to provide the goods or services being sought? We also plan to give an overview of some of these techniques in the next article on data in an upcoming edition of the OIG Bulletin. Thus, the jurisdiction created a ready market for a single vendor without ensuring that drivers were receiving a fair price for the towing and storage services. 200.317, 200.322, and 200.326. To comply with this requirement, a local government must adopt and implement an Eligible Use Policy. For this program, the city of Scranton has elected to award . Most Commonwealth agencies and municipalities rely on vendors to supply the goods and services they need to operate. Historical and external data sources might not provide the complete picture for your analysis. US Treasury issued theFinal Ruleof the Coronavirus State and Local Fiscal Recovery Fund program of the American Rescue Plan Act of 2021 (ARP/CSLFRF) in January 2022. *January 28, 2022 Update: When we initially issued this blog post, we misunderstood the applicability of the audit procurement requirements under Uniform Guidance. Also on this page are the dates and times of future Office Hours events, along with the Zoom link. In the February 2020 issue of the OIG Bulletin, we published the first in a series of articles to help demystify data analytics. A local government should craft its policies and procedures so that they can be reasonably implemented by its staff. Share sensitive information only on official, secure websites. procurement, with 2 CFR 200.319(b) addressing engineering services procurement guidelines. Weve never been audited, so there are no benchmarks to assess our performance., Our regular business hours are third shift., We cannot remove documents from our office., Cross-charging multiple clients or departments for their staffs work, Improper employee classification e.g., junior staff hours billed at a supervisors hourly rate, Overlapping time vendor creates two or more timesheets for the employee for the same day, Schedule manipulation vendor routinely postpones or schedules jobs with higher overtime rates toward the end of the week, Over-purchasing materials for personal use, Product substitution - substituting lower-quality products for those agreed upon in the contract, Failure to apply discounts, refunds and rebates, Billing materials to one project but using for another project, Intentionally applying rates from one contract to another, Billing time and equipment rates in lump-sum, unit or fixed-price contracts. 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