Finding 1147119 (2024-003)

-
Requirement
I
Questioned Costs
-
Year
2024
Accepted
2025-07-08

AI Summary

  • Core Issue: The Organization failed to comply with the Davis-Bacon prevailing wage requirement for construction contracts over $2,000.
  • Impacted Requirements: Non-compliance with CFR 45 and internal procurement policies may lead to improper wage payments.
  • Recommended Follow-Up: Grant staff and management should review contracts and ensure adherence to internal procedures for compliance with federal guidelines.

Finding Text

PROCUREMENT, SUSPENSION & DEBARMENT Federal Agency: Department of Health and Human Services Federal Program or Cluster: Grants for Capital Development in Health Centers Assistance Listing Number: 93.526 Federal Award Numbers and Years Award Period: 9/15/21-8/31/25 - 4 C8ECS44755-01-07 Questioned Costs $0 Condition: The Organization did not comply with the Davis-Bacon prevailing wage requirement. Criteria: CFR 45 requires all prime construction contracts in excess of $2,000 awarded by non-Federal entities to include a provision for compliance with the Davis- Bacon Act as supplemented by Department of Labor regulations. In accordance with the statute, contractors must be required to pay wages to laborers and mechanics at a rate not less than the prevailing wages specified in a wage determination made by the Secretary of Labor. In addition, contractors must be required to pay wages not less than once a week. The non-Federal entity must place a copy of the current prevailing wage determination issued by the Department of Labor in each solicitation. Contractors must also submit certified payroll records to demonstrate compliance. Cause: The Organization did not follow its internal policy for procurement and suspension and debarment. Effect: The Organization could have paid wages at rates other than those required by law. Recommendation: We recommend that grant staff and management review award contracts and related grant guidance and follow documented internal procedures to ensure applicable compliance requirements are identified and implemented. Identification of repeat findings: This is not a repeat finding.View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding. The Director of Finance will prepare a summary document regarding the federal guidelines on procurement, including the requirement that future contractors include contract language complying with the Davis-Bacon Act.

Categories

Procurement, Suspension & Debarment

Other Findings in this Audit

  • 570673 2024-001
    Significant Deficiency
  • 570674 2024-001
    Significant Deficiency
  • 570675 2024-001
    Significant Deficiency
  • 570676 2024-002
    Material Weakness
  • 570677 2024-003
    -
  • 1147115 2024-001
    Significant Deficiency
  • 1147116 2024-001
    Significant Deficiency
  • 1147117 2024-001
    Significant Deficiency
  • 1147118 2024-002
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
93.224 Health Center Program (community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) $243,025
93.526 Grants for Capital Development in Health Centers $229,684
21.027 Coronavirus State and Local Fiscal Recovery Funds $41,319
93.527 Grants for New and Expanded Services Under the Health Center Program $30,783
93.391 Activities to Support State, Tribal, Local and Territorial (stlt) Health Department Response to Public Health Or Healthcare Crises $19,281
14.218 Community Development Block Grants/entitlement Grants $5,325