Finding Text
FINDING 2022-001 DAVIS-BACON COMPLIANCE SIGNIFICANT DEFICIENCY Federal Program: Education Stabilization Fund Elementary and Secondary School Emergency Relief Fund Assistance Listing Number: 84.425D Condition The School entered into an agreement with a contractor for building renovations, paid with funds from the Education Stabilization Fund. A formal contract that included the provisions of the Davis- Bacon Act was not put into place. Criteria 2 CFR part 200, Appendix II, Contract Provisions for Non-Federal Entity Contracts Under Federal Awards, part (D), states: When required by Federal program legislation, all prime construction contracts in excess of $2,000 awarded by non-Federal entities must include a provision for compliance with the Davis-Bacon Act (40 U.S.C 3141-3144, and 3146-3148) as supplemented by Department of Labor regulations (29 CFR Part 5, ?Labor Standards Provisions Applicable to Contracts Covering Federally Financed and Assisted Construction?). In accordance with the statute, contractors must be required to pay wages to laborers and mechanics at a rate not less than the prevailing wages specified in a wage determination made by the Secretary of Labor. In addition, contractors must be required to pay wages not less than once a week. The non-Federal entity must place a copy of the current prevailing wage determination issued by the Department of Labor in each solicitation. The decision to award a contract or subcontract must be conditioned upon the acceptance of the wage determination. Cause The School was not aware of the requirement outlined in the Criteria section above. Effect The School is unable to document that the contractor is compliant with the Davis-Bacon Act. Recommendation We recommend the School develop internal controls to ensure formal contracts are put in place and that required regulations are documented in those contracts to be compliant with federal regulations. Views of Responsible Officials and Planned Corrective Actions The School?s Corrective Action Plan is included on page 24.