Finding Text
2022-006 Special Provisions ? Wage Rate Requirements Federal agency: U.S. Department of Education Federal program name: Education Stabilization Fund Assistance Listing Number: 84.425D and 84.425U Pass-Through Agency: Minnesota Department of Education Pass-Through Number(s): S425C220015, S425D220045, and S425C220045 Award Period: July 1, 2021 - June 30, 2022 Type of Finding: ? Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria or Specific Requirement: Per 2 CFR Part 176, Subpart C and 2 CFR section 200.326, the District shall include in their construction contracts subject to the wage requirements a special provision that the contractor or subcontractor comply with those requirements and the DOL regulations. This includes a requirement for the contractor or subcontractor to submit to the District weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payments). Condition: During special provisions testing, it was noted that for 3 of 3 contractors tested that the required wage rate requirements were not included and the District did not require the contractors to submit certified payments. Questioned Costs: Not determinable. Context: 3 of 3 contracts tested did not follow proper wage requirements. Cause: Oversight. Effect: Lack of proper controls and noncompliance with wage rate requirements could result in the District doing business with contractors that are not paying laborer or mechanics prevailing wage rates. Repeat Finding: No. Recommendation: We recommend that the District consider any contracts for capital expenditures for applicability of Davis Bacon Act wage rate requirements prior to awarding the project and entering into the contract. If it is determined that wage rate requirements apply, the District should ensure the required provision is included in the applicable contracts and then the District also needs to require the applicable contractors to submit certified payrolls during the time of the projects. Views of Responsible Official: There is no disagreement with the finding.