Finding Text
US Department of Education Passed through Oregon Department of Education Program Name: Assistance Listing Number 84.425 - COVID-19 Education Stabilization Fund Cluster - Elementary and Secondary School Relief Fund # 2022-001 - Significant Deficiency in Internal Control over Compliance with Equipment/Real Property Management Criteria ? Uniform Grant Guidance requires that subrecipients that use ESF/ESSER funds for minor remodeling, renovation or construction contracts over $2,000 and use laborers and mechanics must meet Davis-Bacon prevailing wage requirements. Condition ? The District purchased services from an electrical contracting company related to newly installed modular buildings, paid them an amount over $2,000 and did not instruct the company that Davis-Bacon prevailing wage applied. Effect ? The District?s failure to comply with these requirements may have resulted in the electrical company?s personnel being paid less than Davis-Bacon wages. Cause ?District staff were not aware of the $2,000 threshold for this requirement. Perspective ? Only two of the expenses charged to this grant fall under this requirement. The one tested by the auditors was for $64,000, the other was much smaller. Auditor noted during work in other areas of the audit that the District was aware of prevailing wage requirements on larger contracts. This appears to have been an oversight, due to the size of the contract and management?s misunderstanding of the threshold. Recommendation ? Auditor recommends District staff in charge of federal grant compliance, annually review the OMB federal grant compliance supplement, specifically Part 3, Compliance Requirements. A member of management should be assigned with the responsibility to ensure all applicable compliance requirements are met. Management?s response: Management agrees with the finding. In January of each year the Fiscal Director, Jerod Nunn, will meet with the grant manager and review the Office of Management and Budget?s compliance supplement. Any changes and/or updates will be noted in the Federal grant files and will be properly followed so the district is in compliance with the Davis-Bacon and Related Acts and Reorganization Plan Regulations.