Finding Text
ALN, Federal Agency, and Program Name - Education Stabilization Fund - U.S. Department of the Treasury - ALN 84.425U - ESSER III Fund- Formula Federal Award Identification Number and Year - 213713-2122 Pass through Entity - Michigan Department of Education Finding Type - Significant deficiency Repeat Finding - No Criteria - Entities who engage contractors with federal funds are required to include clauses in such contracts to require prevailing wages to be paid and verify that the contractor supplied the appropriate certified payroll information for each payroll period. Condition - The Academy engaged a contractor with the appropriate prevailing wage wording in the contract language. However, the contractor did not provide the certified payroll information as required, and the Academy was unable to obtain it. Questioned Costs - None Identification of How Questioned Costs Were Computed - The contractor provided the hours and the wage rate paid but not the certified payrolls, and the total amounts were approximately $9,000. Context - Of the total capital expenditures during the period of approximately $371,000, only $9,000 related to payroll related items, subject to prevailing wage provisions. Cause and Effect - As a new grant and provision, the Academy did not have a control in place that identified the certified payrolls needed to be obtained. As a result, although the contract language indicated prevailing wages needed to be paid, the documentation required to support the amounts were not obtained timely. Recommendation - We recommend the Academy communicate to the contractors that any further activity associated with payroll must accompany the certified payroll information as required under the grant language, regardless of whether the contract indicates such information is provided. Since the contract language indicates prevailing wages must be paid, requiring the contractor to prove such payments appears to be within the contract provisions. Views of Responsible Officials and Corrective Action Plan - The Academy agrees that they did not receive the certified payroll information as required by the grant and will obtain such information to the extent any further dollars are expended for wages covered by the certified payroll provisions.