Finding 969814 (2023-004)

Significant Deficiency
Requirement
N
Questioned Costs
-
Year
2023
Accepted
2024-04-16
Audit: 303628
Organization: City of Fosston (MN)

AI Summary

  • Core Issue: Two subcontractors failed to submit required certified payrolls to the City for a federal project.
  • Impacted Requirements: Compliance with 29 CFR section 5.5, which mandates weekly submission of payroll and compliance statements.
  • Recommended Follow-Up: The City should establish procedures to ensure all contractors submit certified payrolls weekly to avoid wage discrepancies.

Finding Text

Federal Program Airport Improvement Program (AL 20.106) U.S Department of Transportation Federal Award No: 3-27-0032-015-2022, 3-27-0032-16-23, 3-27-0032-17-23 Federal Award Year: 2023, 2024 Passed Through Minnesota Department of Transportation Special Tests Criteria 29 CFR section 5.5 includes a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). Condition For two subcontractors, the required certified payrolls were not submitted to the City or the City’s Engineer for the project. Questioned Costs None Context A sample of five weeks during the construction period was selected for testing and all certified payrolls for these five weeks were requested. The City’s engineer, who monitors the certified payrolls process, did not have the certified payrolls for two subcontractors who performed work during this five-week period. The engineer was able to provide all the other certified payrolls requested. Cause Management oversight. Effect Employees of the subcontractors might not have received proper wages. Repeat Finding No Recommendation The City should implement procedures to ensure certified payrolls are received weekly from all contractors or subcontractors for each week in which work was performed. Views of Responsible Officials and Planned Corrective Actions The City agrees with the recommendation and will review its policies and procedures.

Categories

Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties Special Tests & Provisions

Other Findings in this Audit

  • 393367 2023-003
    Significant Deficiency
  • 393368 2023-003
    Significant Deficiency
  • 393369 2023-003
    Significant Deficiency
  • 393370 2023-004
    Significant Deficiency
  • 393371 2023-004
    Significant Deficiency
  • 393372 2023-004
    Significant Deficiency
  • 969809 2023-003
    Significant Deficiency
  • 969810 2023-003
    Significant Deficiency
  • 969811 2023-003
    Significant Deficiency
  • 969812 2023-004
    Significant Deficiency
  • 969813 2023-004
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
20.106 Airport Improvement Program $75,945
20.509 Formula Grants for Rural Areas and Tribal Transit Program $68,500