Finding 624039 (2022-003)

Significant Deficiency
Requirement
F
Questioned Costs
-
Year
2022
Accepted
2023-03-13
Audit: 52307
Auditor: Auditor General

AI Summary

  • Core Issue: The District did not consistently ensure compliance with the Davis-Bacon Act for federally funded construction projects over $2,000.
  • Impacted Requirements: Contracts lacked specific clauses for weekly certified payrolls, increasing the risk of non-compliance with prevailing wage rates.
  • Recommended Follow-Up: Enhance procedures to ensure contracts require weekly payroll submissions and verify receipt to comply with Davis-Bacon Act requirements.

Finding Text

Finding: District controls did not always ensure compliance with the Davis-Bacon Act for Federally funded construction projects exceeding $2,000. 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 ensure that contractors pay workers the prevailing wage rates established by the United States Department of Labor. 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 payrolls). 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 public buildings or public work. Condition: During the 2021-22 fiscal year, the Board entered into three construction contracts totaling $336,157 for heating, ventilation, and air-conditioning (HVAC) renovation projects at Lake Butler Elementary School, Lake Butler Middle School, and Union County High School. As of June 30, 2022, the District had expended ESSER funds totaling $336,157 on the projects. Our examination of the project contracts disclosed that they contained clauses that required the projects to comply with the Davis-Bacon Act provisions. However, contractors did not submit to the District weekly certified payrolls demonstrating prevailing wage rates were paid. Subsequent to our inquiry, District personnel obtained from the HVAC contractor certified payrolls demonstrating that prevailing wage rates were paid for these projects. Cause: District contracts did not specifically require contractors to submit to the District weekly certified payrolls and District procedures had not been established to require District personnel to verify that the payrolls were received. Effect: Absent the required contract clauses and weekly certified payrolls, there is an increased risk that construction contractors paid with Federal moneys will not pay workers the prevailing wage rates established by the United States Department of Labor. Recommendation: The District should enhance procedures to ensure compliance with all Davis-Bacon Act requirements. Such procedures should ensure that applicable Federally funded facility contracts specifically require submittal of weekly certified payrolls and that District personnel verify the payrolls were received. District Response: The District has trained new purchasing staff on procedures to ensure future compliance with Davis-Bacon Act provisions.

Categories

Special Tests & Provisions

Other Findings in this Audit

  • 47597 2022-003
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
10.555 National School Lunch Program $1.56M
84.010 Title I Grants to Local Educational Agencies $472,622
93.575 Child Care and Development Block Grant $126,297
84.027 Special Education_grants to States $117,552
84.367 Supporting Effective Instruction State Grants $112,682
84.002 Adult Education - Basic Grants to States $83,801
12.U01 Army Junior Reserve Officers Traing Corps $69,912
84.048 Career and Technical Education -- Basic Grants to States $62,296
10.582 Fresh Fruit and Vegetable Program $56,297
84.424 Student Support and Academic Enrichment Program $36,924
84.173 Special Education_preschool Grants $6,088
84.425 Education Stabilization Fund $1,424