Finding Text
Education Stabilization Fund – Prevailing wage rate requirements
Condition: There was one Education Stabilization Fund construction project performed by a contractor. Grant expenditures for the project paid by the Education Stabilization Fund totaled $349,716. There was not a prevailing wage clause in the contract and certified payrolls were not received.
Criteria: Wage rate requirements apply to the Education Stabilization Fund when laborers and mechanics employed by contractors or subcontractors work on construction contracts more than $2,000. Laborers must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL).
Nonfederal entities shall include in their contracts, subject to wage rate requirements, a 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 payrolls and a statement of compliance (certified payrolls).
Cause: The District was not aware that wage rate requirements applied to the construction project.
Effect: $349,716 of costs are likely questioned as a result of failing to comply with wage rate requirements.
Questioned Costs: $349,716
Auditor’s Recommendation: Establish controls to comply with wage rate requirements related to the Education Stabilization Fund.
Grantee Response: The District will comply with the wage rate requirements for the Education Stabilization Fund going forward.