GALVESTON BAY FOUNDATION INC

Finding #2024-001 – Significant Deficiency and Other Noncompliance. Applicable programs: Federal Awards, U. S. Environmental Protection Agency, Assistance Listing #66.456, National Estuary program, Passed through Texas Commission on Environmental Quality: Contract period: 09/01/23 – 08/31/25, Contract number: 582-24-50165, Contract period: 07/19/18 – 08/31/24, Contract number: 582-18-80344, Contract period: 09/01/23 – 05/31/26, Contract number: 582-24-50138, Contract period: 09/01/24 – 08/31/26, Contract number: 582-25-00053, Contract period: 09/01/24 – 08/31/26, Contract number: 582-25-00064, Passed through Houston Advanced Research Center: Contract period: 09/01/22 – 03/31/25, Contract number: GBFO322, Passed through Lee College: Contract period: 05/30/23 – 05/31/25, Contract number: 582-23-40258. State Awards, Texas General Land Office, Coastal Erosion Planning and Response Act, Contract period: 07/09/20 – 08/31/25, Grantor number: 20-132-008-C191, Contract period: 07/07/20 – 08/31/25, Grantor number: 20-132-007-C190, Contract period: 07/07/20 – 08/31/25, Grantor number: 20-132-011-C293, Contract period: 11/10/22 – 08/31/27, Grantor number: 22-133-008-D367, Contract period: 11/29/22 – 08/31/27, Grantor number: 22-113-006-D365. Criteria: Procurement – Nonprofit organizations are required to conduct procurement transactions consistent with standards prescribed in Uniform Guidance, Procurement Standards, Texas Grant Management Standards (TxGMS), and conform to federal and state laws and regulations and other contractual requirements. This includes specific procurement, suspension and debarment evaluation requirements. Condition and context: We reviewed the procurement documentation for 3 vendors with expenditures greater than $10,000 requiring procurement, and identified that suspension and debarment procedures were not documented and retained. Effect: Failure to follow the Foundation’s procurement policy, Uniform Guidance, and TxGMS could result in the selection of ineligible vendors. Recommendation: Management should provide additional training to staff with purchasing authority on the procurement policy. View of responsible officials and planned corrective actions: Management agrees with the finding. See Corrective Action Plan.

Finding #2024-002 – Significant Deficiency and Other Noncompliance. Applicable federal programs: U. S. Environmental Protection Agency, Assistance Listing #66.456, National Estuary program, Passed through Texas Commission on Environmental Quality: Contract period: 09/01/23 – 08/31/25, Contract number: 582-24-50165. Criteria: In accordance with Uniform Guidance OMB 2 CFR §200.331(a), pass through entities must provide subrecipients with specific information at the time of the subaward, including the assistance listing number, federal award identification number (FAIN), name of the federal awarding agency, pass through entity and contact information for awarding official, federal award date of award to the recipient by the Federal agency, access to subrecipient’s records and retention period, and a statement regarding the close-out terms and conditions. Condition and context: We reviewed one of the two subrecipient awards for the required information described in the criteria above and noted such provisions were not included in the subrecipient agreement. Effect: Failure to communicate required information may result in subrecipients not properly complying with federal requirements, increasing the risk of noncompliance. Recommendation: Policies and procedures should be implemented to ensure all required information is included in the subrecipient agreement before issuance. View of responsible officials and planned corrective actions: Management agrees with the finding. See Corrective Action Plan.