Finding Text
USDA Rural Development - Water and Waste Disposal Loans, Loan Guarantees, and Grants ALN 10.770 Federal Award Year 2022 - Material Weakness In Controls Over Compliance - Failure to obtain payroll certifications for all periods in which work was performed, wage certifications listed fewer than the total number of workers, and failure to obtain contracts from sub-contractors of the primary sub-contractor. Criteria: This program requires compliance with the Davis-Bacon Act. Condition - All labor involved in this contract is provided by a sub-contractor employed by the general contractor. The sub-contractor provided payroll certifications reporting the sub-contractor's employees along with hours and payments to the sucontractors of the sub-contractor. No contracts were obtained for the sub-contractors of the sub-contractor, assuring that if they hired workers or provided materials, they would be bound by the provisions of the contractact between the owner and the general contractor. The payroll certifications for employees of the sub-contractor were incomplete in that withholding details were not included. In addition, the resident engineer observed work being performed during periods in which no payroll certifications were provided, and in some periods when payroll certifications were provided the resident engineer observed more workers than were listed in the payroll certifications. A contracted teamster had been omitted from some of the original pay estimates. Questioned costs - None. Repeat finding - No. Cause: Adequate attention was not given to the payroll certifications and/or the lack of sub-sub contrats and missing details were ignored. Recommendation: The District should insist that contracts are obtained from all sub-contractors (including workers the contractor or sub-contractor pay on a contractual basis), that all information is provided on the payroll certifications, and that all workers are accounted for on the payroll certification befor approving pay estimates. The District should have contact information for all contractors, sub-contractors, or contractual personnel working on the project. All sub-contractors should agree to comply with Davis-Bacon provisions of the original contract.