Finding Text
Special Tests and Provisions
Federal Program Information
Funding Agency: U.S. Department of Education
Pass-Through Entity: North Dakota State Department of Public Instruction
Pass-Through Entity: North Dakota State Department of Health and Human Services
Title: Education Stabilization Fund
AL Number: 84.425
Criteria
Uniform Guidance requires “all laborers and mechanics employed by contractors or
subcontractors to work on construction contracts in excess of $2,000 financed by federal
assistance funds must be paid wages not less than those established for the locality of the
project (prevailing wage rates) by the Department of Labor (DOL)”. Furthermore, “nonfederal
entities shall include in their construction contracts subject to the Wage Rate Requirements
(which still may be referenced as the Davis-Bacon Act) a provision that the contractor or
subcontractor comply with those requirements and the DOL regulations (29 CFR Part 5,
Labor Standards Provisions Applicable to Contracts Governing Federally Financed and
Assisted Construction). This includes a requirement for the contractor or subcontractor to
submit to the nonfederal entity weekly, for each week in which any contract work is
performed, a copy of the payroll and a statement of compliance (certified payrolls) (29 CFR
sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)).
Condition
District did not have the required wage rate verbiage in their signed construction contract.
Furthermore, there was no review of the certified payrolls to ensure wages paid were paid
according to the wage rate requirements.
Questioned Costs
Undeterminable
Context
The District had contracted out one construction project during the period under audit.
Effect
Wages paid by contractors may not have been in accordance with criteria identified above.
Cause
Management oversight.
Recommendation
We recommend the District implement policies and procedures to ensure when federal funds
are paying for construction in excess of $2,000, that the wage rate requirements are being
followed.
Repeat Finding
This is a repeat finding of 2023-006.
Views of Responsible Officials
See corrective action plan.