Finding Text
Finding: District controls did not always ensure compliance with the Davis-Bacon Act for Federally funded construction projects exceeding $2,000, resulting in Federal program questioned costs totaling $1,251,947. Criteria: The ESSER Fund provides Federal funds for school facility repairs and improvements to reduce the risk of virus transmission and exposure to environmental health hazards and to support student health needs. Title 29, Section 5.5, Code of Federal Regulations (Davis-Bacon Act), requires the District to include prevailing wage rate clauses in any construction contract exceeding $2,000 that is financed either wholly or in part by Federal funds and to ensure that contractors and subcontractors pay workers the prevailing wage rates established by the United States Department of Labor. The United States Department of Labor established ?prevailing wages? by geographic area and interprets the Davis Bacon Act to apply to construction, alteration, or repair of a public building or public work. Condition: During the 2019-20 fiscal year, the Board entered into a construction contract for heating, ventilation, and air-conditioning repairs and upgrades at all District schools and various administrative and support offices. As of June 2022, the District had expended ESSER funds totaling $1,251,947 on the project. We noted that the contract for the project did not contain clauses that required the contractors and subcontractors to comply with the Davis-Bacon Act provisions. In addition, in response to our inquiry, District personnel indicated that they had not performed direct comparisons of wage rates paid by the contractor and subcontractors for the project with the prevailing wages established by the United States Department of Labor. Cause: District personnel were not aware that the Davis-Bacon Act applied to the project. Effect: Without an appropriate understanding of the Davis-Bacon Act and when to apply the Act requirements, there is an increased risk that that construction contractors and subcontractors paid with Federal moneys will not pay workers the prevailing wage rates established by the United States Department of Labor. Although we requested, the District did not provide the certified payrolls from the contractor demonstrating that the prevailing wage rates were paid for these projects. Consequently, the District incurred questioned costs totaling $1,251,947. Recommendation: The District should establish procedures to comply with all provisions of the Davis-Bacon Act. Such procedures should include appropriate training for staff to understand the Davis-Bacon Act and when the Act requirements should be applied. In addition, the procedures should ensure that Federally funded facility contracts include the required prevailing wage rate clauses and that wage rates paid by the contractor and subcontractors for such projects are directly compared to and determined to be consistent with the prevailing wages established for the geographic area by the United States Department of Labor. Also, the District should document to the Florida Department of Education (FDOE) the allowability of the questioned costs of $1,251,947 or contact the FDOE regarding necessary corrective action. District Response: The District will enhance its procedures to ensure compliance with the Davis Bacon Act.