Wellington Exempted Village School District

2 CFR § 3474.1 gives regulatory effect to the Department of Education for 2 CFR § 200.313(d)(1) which provides that property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the Federal award identification number), who holds title, the acquisition date, cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property. Additionally, 2 CFR § 200.313(d)(2) states that a physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Due to inadequate controls, the District failed to appropriately track a bus purchased in part with Special Education Cluster grants monies in September 2019. The bus is included on the District's capital asset listing; however, it is listed as being purchased from a fund other than the Special Education Cluster grant funds. Additionally, the District did not maintain support for the cost allocation information as required by the Ohio Department of Education and Workforce (DEW). Therefore, the District does not have support for the proportionate share of the cost covered by the grant as required upon disposition of the bus. The District also did not maintain documentation of the required physical inventory. The failure to properly record assets can lead to difficulties maintaining accountability for the related assets. The District should implement controls to ensure compliance with all DEW and Uniform Guidance requirements when purchasing equipment with Federal award funds.

2 CFR 3474.1 provides that the Department of Education (DOE) adopts the Office of Management and Budget (OMB) Guidance in 2 CFR part 200. Thus, this section gives regulatory effect to the OMB guidance and supplements the guidance as needed for the DOE, except as otherwise noted in that section. Appendix II to 2 CFR part 200, Paragraph D states that all contracts made by the non-Federal entity under the Federal award must contain provisions covering the following: (D) Davis-Bacon Act, as amended (40 U.S.C. 3141-3148). When required by Federal program legislation, all prime construction contracts in excess of $2,000 awarded by non-Federal entities must include a provision for compliance with the Davis-Bacon Act (40 U.S.C. 3141-3144, and 3146-3148) as supplemented by Department of Labor regulations (29 CFR Part 5, ?Labor Standards Provisions Applicable to Contracts Covering Federally Financed and Assisted Construction?). In accordance with the statute, contractors must be required to pay wages to laborers and mechanics at a rate not less than the prevailing wages specified in a wage determination made by the Secretary of Labor. In addition, contractors must be required to pay wages not less than once a week. The non-Federal entity must place a copy of the current prevailing wage determination issued by the Department of Labor in each solicitation. The decision to award a contract or subcontract must be conditioned upon the acceptance of the wage determination. The non-Federal entity must report all suspected or reported violations to the Federal awarding agency. The contracts must also include a provision for compliance with the Copeland ?Anti-Kickback? Act (40 U.S.C. 3145), as supplemented by Department of Labor regulations (29 CFR Part 3, ?Contractors and Subcontractors on Public Building or Public Work Financed in Whole or in Part by Loans or Grants from the United States?). The Act provides that each contractor or subrecipient must be prohibited from inducing, by any means, any person employed in the construction, completion, or repair of public work, to give up any part of the compensation to which he or she is otherwise entitled. The non-Federal entity must report all suspected or reported violations to the Federal awarding agency. Lack of proper internal controls over Federal Grants management led to the District expending $51,250 of its Education Stabilization Fund - American Rescue Plan Elementary and Secondary School Emergency Relief (ARP ESSER) Fund, AL #84.425U, federal grant funds for a HVAC project at the District's high school and a roof replace replacement project for the District's fieldhouse without the District?s contracts including a provision to ensure the contractors complied with Federal wage rate requirements. Additionally, the District did not obtain weekly certified payroll reports from the contractors to verify prevailing wages were paid on a weekly basis. Without proper controls over wage rate requirements, there is an increased risk that the District and its contractors and subcontractors are not in compliance with applicable federal regulations. Noncompliance could result in federal funding being reduced or taken away, or other sanctions imposed by the federal grantor agency. The District should ensure contracts for construction in excess of $2,000 paid with federal grant monies contain a provision the contractor comply with the wage rate requirements and ensure certified payroll reports are provided weekly by the contractor. The District should review the certified payroll reports and report all suspected or reported violations to the Federal awarding agency.