Q. I am an auditor and my client purchased 2 buses with FTA funds during 2010. The total amount for the 2 buses was approximately $700,000. However this purchase was performed using a Purchase Order with the vendor and no contract was drafted for this purchase. Therefore the client did not check the Excluded Parties List System before they entered into this transaction. Because this transaction was not actually a contract, but did indeed exceed the $25,000 threshold (2 CFR Parts 180_215 Debarment OMB Guidance & FTA Circular 4220.1F) for transactions with a third party. Should my client have checked the EPLS website before they entered into this transaction?
A. The FTA Procurement Circular 4220.1F, which is available online at:
http://www.fta.dot.gov/documents/C_4220_1F.pdf, requires that grantees comply with the Circular requirements when they award third party contracts that are financed with FTA funds. Third party "contracts" are defined in Chapter I, paragraph 5. bb. as "a recipient's contract with a vendor or contractor, including procurement by purchase order or purchase by credit card, which is financed with Federal assistance awarded by FTA." From this definition you can see that purchase orders are defined by FTA as "contracts," and as such the grantee must comply with all Circular requirements, including the EPLS review, as well as incorporating all the required contract provisions for that type of commodity. The specific contract clause requirements for rolling stock and other commodities and services are described in the Circular's Appendix D. (Posted: July, 2011)