Finding Text
2022-07 Non-compliance with Wage Rate Requirements CFDA Title: Impact Aid CFDA Number: 84.041 Federal Award Number: 2022 Federal Agency: U.S. Department of Education Pass-through Entity: Direct Condition: The District did not require certified weekly payrolls for claims paid related to fixing a water line and electrical upgrades paid with Impact Aid funding. Context: During testing of the Impact Aid expenditures, we noted two vendors related to construction/remodeling. Criteria: Compliance Requirements ? Section 7007 construction funds, as well as any Section 7002 or 7003(b) funds spent for construction or minor remodeling, are subject to Wage Rate Requirements (20 USC 1232b). Compliance Requirement ? 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) (40 USC 3141-3144, 3146, and 3147). Non-federal 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 non-Federal 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). Effect: The District was not in compliance with the Wage Rate Requirement. Cause: The vendors did not submit the weekly certified payroll reports and the District?s internal control system did not detect the error. Recommendation: The District should require all Impact Aid fund expenditures for construction or minor remodeling to be subject to the Wage Rate Requirements.