Finding Text
8. Criteria or specific requirement (including statutory, regulatory, or other citation) "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 Contacts 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)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.326). " 9. Condition The auditee did not obtain the required certified payroll reports from contractors in accordance with the Davis‑Bacon Act and related labor standards, nor did the contractors or subcontractors submit the certified payrolls to the U.S. Department of Labor as required. 10. Questioned Costs None noted 11. Context The auditee contracted with Daikin TMI for HVAC work utilizing ESSER Funding. Due to the nature of the contract, prevailing wage requirements were applicable. 12. Effect Without certified payrolls, the entity cannot demonstrate compliance with federal prevailing wage requirements. 13. Cause The vendor East St. Louis School District 189 contracted with had turnover in the accounting department. That position was responsible for uploading certified payrolls to the IDOL as well as sending them to the client with the invoices. The vendor also went through a formal name change in June of 2025 which caused an issuance of a new FEIN and IL Tax ID. During this time, they were not recognized and unable to upload during this time. 14. Recommendation We recommend the auditee establish and enforce procedures to: 1) Obtain certified payrolls from all contractors and subcontractors subject to prevailing wage requirements and 2) Review payrolls for compliance with wage rates and maintain documentation for audit purposes. 15. Management's response See Corrective Action Plan.