2 Agencies Run Afoul of Federal Debarment Requirements

The Washington State Auditor's Office recently issued similar audit findings against both the University Place School District and the South Central Workforce Council in Yakima County.

What's Required?  Both audit findings were for failure to fulfill the requirement that on federally funded projects agencies are prohibited from contracting with a company debarred or suspended from doing business with the federal government. For contracts worth $25,000 or more, agencies must ensure that vendors are not debarred or suspended.

• The University Place School District received money from a State Fiscal Stabilization Fund grant, and paid over $434,000 of it for materials without checking that the vendor was eligible to do business with the federal government. According to the audit, "the District was not aware the requirements for suspension and debarment applied to the State Fiscal Stabilization Fund program," although the District did already have procedures in place to deal with suspension and disbarment requirements. (Read the full audit here)

• The South Central Workforce Development Council received money from a number of job placement and training programs funded by the American Recovery and Reinvestment Act (ARRA). During 2010, the Council paid over $783,000 to five organizations, primarily for worker training, without verifying that the organizations receiving the money were not disbarred or suspended as per federal requirements. (Read the full audit here)

Complying with Federal Debarment Requirements:  In general, if a project is receiving federal funding, public agencies should implement one of three procedures to ensure they are in compliance with federal debarment/suspension rules:

1. EPLS:  Consult the online federal Excluded Parties List System (EPLS) before awarding funds to contractors or sub-recipients.  Print out a copy of the documentation for your contract file.
   
2. Contract Clause:  Insert a clause or condition into the contract that states the contractor or sub-recipient is not suspended or debarred.
3. Certification:  Obtain a written certification from the contractor or sub-recipient that they are not debarred or suspended from doing business with the federal government.

Some public agencies make it a practice to check the status of all contractors, consultants, and vendors through EPLS, regardless of whether the project contains federal funding.  This helps ensure that certain federally funded projects are not missed.

Mike Purdy's Public Contracting Blog 

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