Finding Text
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION "COVID-19 - AMERICAN RESCUE PLAN - ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND - AL NUMBER 84.425U" PASS-THROUGH NUMBER 4602 AUDIT PERIOD - YEAR ENDED JUNE 30, 2022 2022-002. Equipment and Real Property Management Criteria or specific requirement: The Davis-Bacon Act requires all contractors and subcontractors performing work on construction contracts in excess of $2,000, financed by Federal funds, to pay their laborers and mechanics not less than the prevailing wage rates as determined by the Department of Labor. Non-federal entities are to include in the applicable construction contracts a requirement that the contractor or subcontractor comply with the provisions of the Davis-Bacon Act and the Department of Labor regulations. Such requirements included the submission of weekly certified payrolls, for each week in which any contract work is performed, to the non-federal entities. Condition: The District paid a contractor $215,980 from the Education Stabilization Fund for installation of an HVAC system without obtaining a written contract that included the prevailing wage rate clause. Additionally, weekly certified payrolls were not submitted to the District. Cause: Lack of internal controls and management oversight resulted in the Davis-Bacon Act provisions not being properly followed. Effect or potential effect: The District did not comply with the notification requirements regarding compliance with the Davis-Bacon Act and was unable to provide copies of weekly certified payrolls for workers paid on the project. Context: Examined the only construction contract for facility repairs and improvements paid from the Education Stabilization Fund. Recommendation: The District should ensure that all applicable construction contracts contain the required notification regarding compliance with the Davis-Bacon Act. Copies of the weekly certified payrolls should be obtained for the applicable projects. The District should also contact the Arkansas Division of Elementary and Secondary Education (DESE) for further directives regarding this matter. Views of responsible officials: If Federal funds are used in any future construction projects the district will ensure all contracts contain the required notification regarding compliance with the Davis-Bacon Act. Procedures will be put into place to ensure that the district stays in compliance with the Davis-Bacon Act.