Finding Text
Criteria and Condition: The Davis-Bacon Act (the Act) requires contractors to pay federally prescribed prevailing wages to laborers for federally-funded construction projects that exceed $2,000. Grant recipients must include in construction contracts a provision requiring contractors and subcontractors to comply with the Act. Additionally, grant recipients must ensure that the contractors and subcontractors are in compliance. We found the School did not comply with the Act. Context: The School entered into two contracts for construction greater than $2,000 that did not include prevailing wage requirements as required, one funded with each grant, ESSER and ARP ESSER. The total construction contract related to the ESSER grant to date totaled $1,433,266 of which $277,174 was funded with the ESSER grant this year. The total construction contract related to the ARP ESSER grant was $1,981,026 of which $757,400 was funded with grant funds this year. Both contracts included costs for labor and materials although the cost of materials ($372,377) on the ESSER grant exceeded the federal funding spent and on the ARP ESSER grant, only $22,400 of the $757,400 was used for labor. Neither construction contract included a provision requiring the contractors to comply with the Act and thus, the contractor may not have paid the proper prevailing wages. Effect: This could have resulted in an underpayment of wages to laborers working on the project. Cause: The School was not aware of the requirements of the Act. Recommendation: The School should ensure that all federally funded construction contracts over $2,000 should include the required provision to follow the Act and the School should ensure that the contractors are following the regulations and paying proper wages. Views of responsible officials and planned corrective actions: The School is in the process of reviewing the rules and designing and implementing controls to ensure compliance with the Act.