Audit 46898

AL 84.425 Elementary and Secondary School Emergency Relief Fund (ESSER), US Department of Education, Award ID: 64601, Award Year: July 1, 2022 ? June 30, 2022. Compliance requirement: Special Tests and Provisions. Criteria: Real property or equipment improvements in excess of $2,000 funded through the ESSER program are subject to the federal Davis Bacon Act. Contracts negotiated between the District and contractor for federally funded work must include a provision requiring payment of the prevailing wage for all work on the project. The District must also determine the prevailing wage rate that applies to the contract at inception and obtain and review weekly certified payroll reports for the federal project for compliance with the rate in effect when the contract was negotiated. Condition and context: It appears the work was performed under a maintenance agreement negotiated in 2019, which did not include the required Davis Bacon Act language. Management obtained certified payroll reports for June 2022 labor related to the project after the request from the auditors for copies of the reports. One of the projects included labor based on the contractor?s ?call summary?, but contractor later indicated that no labor was performed and the charge was only for materials dropped but not installed. Cause: We are unable to conclude as to the cause of the noncompliance, it appears that management was not aware there was a Davis Bacon Act requirement related to the work. We also note that work previously completed was charged later to the program, which was a contributing cause, as the original work was not contemplated initially as a federal contract. Effect: The District was unable to verify that the contractor paid their laborers prevailing wage rates as required. Recommendation: We recommend the District ensure that staff in charge of federal programs understand the program and obtain training prior to being given responsibility for federal programs. Each federal program contains different requirements, many of which are unrelated to whether the particular cost is allowed to be charged to the program. Views of responsible officials: District agrees with this recommendation. We will provide staff with additional training specific to Davis-Bacon wages and federal requirements.

AL 84.425 Elementary and Secondary School Emergency Relief Fund (ESSER), US Department of Education, Award ID: 64601, Award Year: July 1, 2022 ? June 30, 2022. Compliance requirement: Special Tests and Provisions. Criteria: Internal controls over compliance must be in place for every compliance requirement that the federal agency indicates is relevant to the program. Each federal program is generally limited to identifying no more than six of the 12 compliance requirements to be audited. For each of the six identified, however, the District is responsible for (1) determining if is relevant to their program and (2) if relevant, implementing control systems to ensure compliance. Condition and context: We were unable to find evidence that management knew of the Davis Bacon Act requirement or implemented internal controls over the compliance requirement. Cause: Based on responses to our inquiry, we believe the cause of a lack of knowledge and understanding of the program?s requirements. Effect: The District was unable to verify that the contractor paid their laborers prevailing wage rates as required. Recommendation: We recommend the District ensure that staff in charge of federal programs understand the program and obtain training prior to being given responsibility for federal programs. Each significant federal program should have its requirements documented and related compliance controls implemented and formally documented to ensure compliance with all relevant requirements. Views of responsible officials: District agrees with this recommendation. We will provide staff with additional training specific to Davis-Bacon wages and federal requirements.

AL 84.425 Elementary and Secondary School Emergency Relief Fund (ESSER), US Department of Education, Award ID: 64601, Award Year: July 1, 2022 ? June 30, 2022. Compliance requirement: Special Tests and Provisions. Criteria: Real property or equipment improvements in excess of $2,000 funded through the ESSER program are subject to the federal Davis Bacon Act. Contracts negotiated between the District and contractor for federally funded work must include a provision requiring payment of the prevailing wage for all work on the project. The District must also determine the prevailing wage rate that applies to the contract at inception and obtain and review weekly certified payroll reports for the federal project for compliance with the rate in effect when the contract was negotiated. Condition and context: It appears the work was performed under a maintenance agreement negotiated in 2019, which did not include the required Davis Bacon Act language. Management obtained certified payroll reports for June 2022 labor related to the project after the request from the auditors for copies of the reports. One of the projects included labor based on the contractor?s ?call summary?, but contractor later indicated that no labor was performed and the charge was only for materials dropped but not installed. Cause: We are unable to conclude as to the cause of the noncompliance, it appears that management was not aware there was a Davis Bacon Act requirement related to the work. We also note that work previously completed was charged later to the program, which was a contributing cause, as the original work was not contemplated initially as a federal contract. Effect: The District was unable to verify that the contractor paid their laborers prevailing wage rates as required. Recommendation: We recommend the District ensure that staff in charge of federal programs understand the program and obtain training prior to being given responsibility for federal programs. Each federal program contains different requirements, many of which are unrelated to whether the particular cost is allowed to be charged to the program. Views of responsible officials: District agrees with this recommendation. We will provide staff with additional training specific to Davis-Bacon wages and federal requirements.

AL 84.425 Elementary and Secondary School Emergency Relief Fund (ESSER), US Department of Education, Award ID: 64601, Award Year: July 1, 2022 ? June 30, 2022. Compliance requirement: Special Tests and Provisions. Criteria: Internal controls over compliance must be in place for every compliance requirement that the federal agency indicates is relevant to the program. Each federal program is generally limited to identifying no more than six of the 12 compliance requirements to be audited. For each of the six identified, however, the District is responsible for (1) determining if is relevant to their program and (2) if relevant, implementing control systems to ensure compliance. Condition and context: We were unable to find evidence that management knew of the Davis Bacon Act requirement or implemented internal controls over the compliance requirement. Cause: Based on responses to our inquiry, we believe the cause of a lack of knowledge and understanding of the program?s requirements. Effect: The District was unable to verify that the contractor paid their laborers prevailing wage rates as required. Recommendation: We recommend the District ensure that staff in charge of federal programs understand the program and obtain training prior to being given responsibility for federal programs. Each significant federal program should have its requirements documented and related compliance controls implemented and formally documented to ensure compliance with all relevant requirements. Views of responsible officials: District agrees with this recommendation. We will provide staff with additional training specific to Davis-Bacon wages and federal requirements.