EIN: 464351497
UEI: GQ37EPRF6G48
Audited by: Barnes, Dennig & Co, Ltd.
Oversight agency: 84 [Department of Education]
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Data as of September 2, 2026
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on December 13, 2025. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by June 13, 2026 (81 days ago).
What is a management decision? →The School did not maintain records for food and construction vendors that met the acquisition thresholds for the year. Cause: The School’s procurement policies do not address the frequency of which vendors should be evaluated. In addition, the policies also do not address records retention. Potential effect: The procurement may not have been proper under the grant requirements. Questioned costs: None. Repeat Finding: Repeat of finding 2024-004. Context: A total sample of two (2) of thirteen (13) purchases related to a certain food provider were selected as a part of procurement and suspension and debarment compliance requirement testing for the Child Nutrition Cluster. Additionally, one (1) of two (2) construction projects begun during the fiscal year did not undergo a formal RFP nor were posted publicly to obtain multiple bids. Recommendation: We recommend that the School follow federal procurement guidelines for each of the different purchase thresholds for each vendor. We further recommend that the School retain any documentation created related to the procurement selection and vetting process. Views of Responsible Officials: See attached Corrective Action Plan.
Show full finding ▾Hide full finding ▴Finding 2025-001, Significant deficiency Identification of federal program: US DEPARTMENT OF AGRICULTURE passed through the Indiana Department of Education Child Nutrition Cluster 10.553 & 10.555, US DEPARTMENT OF EDUCATION passed through the Indiana Department of Education Chater School Facilities Incentive Grant 84.282D Criteria: According to 2CFR 200.318(i) the recipient or subrecipient must maintain records sufficient to detail the history of each procurement transaction. These records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price. Condition: The School did not maintain records for food and construction vendors that met the acquisition thresholds for the year. Cause: The School’s procurement policies do not address the frequency of which vendors should be evaluated. In addition, the policies also do not address records retention. Potential effect: The procurement may not have been proper under the grant requirements. Questioned costs: None. Repeat Finding: Repeat of finding 2024-004. Context: A total sample of two (2) of thirteen (13) purchases related to a certain food provider were selected as a part of procurement and suspension and debarment compliance requirement testing for the Child Nutrition Cluster. Additionally, one (1) of two (2) construction projects begun during the fiscal year did not undergo a formal RFP nor were posted publicly to obtain multiple bids. Recommendation: We recommend that the School follow federal procurement guidelines for each of the different purchase thresholds for each vendor. We further recommend that the School retain any documentation created related to the procurement selection and vetting process. Views of Responsible Officials: See attached Corrective Action Plan.
Criteria: According to 2CFR 200.318(i) the recipient or subrecipient must maintain records sufficient to detail the history of each procurement transaction. These records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price. Condition: The School did not maintain records for food and construction vendors that met the acquisition thresholds for the year. Cause: The School's procurement policies do not address the frequency of which vendors should be evaluated. In addition, the policies also do not address records retention. Potential Effect: The procurement may not have been proper under the grant requirements.Recommendation: We recommend that the School follow federal procurement guidelines for each of the different purchase thresholds for each vendor. We further recommend that the School retain any documentation created related to the procurement selection and vetting process. Action: As of the date of this exit conference, we will adopt the above recommendations, securing and retaining the appropriate documentation of vendor selection and retention.
2024-004
The School’s construction vendor was unable to confirm that the stipulations of Build America Buy America Act (BABAA) were followed. Cause: The School’s did not obtain nor inquire on the vendor’s policy on sourcing materials used for infrastructure construction. Potential effect: The materials may not have been sourced properly under the grant requirements. Questioned costs: None. Context: A total sample of one (1) of two (2) construction projects begun during the fiscal year were unable to confirm that BABAA was followed. Recommendation: We recommend that the School inquire of vendors on their compliance with BABAA. Views of Responsible Officials: See attached Corrective Action Plan.
Show full finding ▾Hide full finding ▴Finding 2025-002, Significant deficiency Identification of federal program: US DEPARTMENT OF EDUCATION passed through the Indiana Department of Education Chater School Facilities Incentive Grant 84.282D Criteria: According to 2CFR 184.1(b), funds are not to be made available for an infrastructure project unless all of the iron, steel, manufactured products, and construction materials incorporated into the project are produced in the United States. Condition: The School’s construction vendor was unable to confirm that the stipulations of Build America Buy America Act (BABAA) were followed. Cause: The School’s did not obtain nor inquire on the vendor’s policy on sourcing materials used for infrastructure construction. Potential effect: The materials may not have been sourced properly under the grant requirements. Questioned costs: None. Context: A total sample of one (1) of two (2) construction projects begun during the fiscal year were unable to confirm that BABAA was followed. Recommendation: We recommend that the School inquire of vendors on their compliance with BABAA. Views of Responsible Officials: See attached Corrective Action Plan.
Criteria: According to 2CFR 184.l(b), funds are not to be made available for an infrastructure project unless all of the iron, steel, manufactured products, and construction materials incorporated into the project are produced in the United States. Condition: The school's construction vendor was unable to confirm that the stipulations of Build America Buy America Act (BABAA) were followed. Cause: The School did not obtain nor inquire on the vendor's policy on sourcing materials used for the infrastructure construction. Potential Effect: The materials may not have been sourced properly under the grant requirements. Recommendation: We recommend that the School inquire of vendors on their compliance with BABAA. Action Taken: As of the date of the exit conference, we will institute an inquiry of the potential vendor as their compliance with BABAA.
The School over-allocated health insurance benefits to the Child Nutrition Cluster Cause: The School was using an outdated allocation formula that did not reflect changes to personnel in the program. Effect: The School over-allocated health insurance benefits to the Child Nutrition Cluster. Questioned costs: $9,215 Context: Of the six employees in the program tested, one employee had health insurance benefits. The outdated allocation formula was used for all twelve months of the school year. Recommendation: We recommend that the School review fringe benefit allocations at the start of each school year, and then at least quarterly throughout the year to monitor for personnel changes that may impact allocations so that allocations may be adjusted timely. Views of Responsible Officials: See attached Corrective Action Plan.
Show full finding ▾Hide full finding ▴Finding 2025-003, Significant deficiency Identification of federal program: US DEPARTMENT OF AGRICULTURE passed through the Indiana Department of Education Child Nutrition Cluster 10.553 & 10.555, Criteria: According to 2CFR 200.431(c) The recipient or subrecipient must allocate fringe benefits to Federal awards and all other activities in a manner consistent with the pattern of benefits attributable to the individuals or group(s) of employees whose salaries and wages are chargeable to such Federal awards and other activities, and charged as direct or indirect costs following the recipient's or subrecipient's accounting practices. Condition: The School over-allocated health insurance benefits to the Child Nutrition Cluster Cause: The School was using an outdated allocation formula that did not reflect changes to personnel in the program. Effect: The School over-allocated health insurance benefits to the Child Nutrition Cluster. Questioned costs: $9,215 Context: Of the six employees in the program tested, one employee had health insurance benefits. The outdated allocation formula was used for all twelve months of the school year. Recommendation: We recommend that the School review fringe benefit allocations at the start of each school year, and then at least quarterly throughout the year to monitor for personnel changes that may impact allocations so that allocations may be adjusted timely. Views of Responsible Officials: See attached Corrective Action Plan.
Criteria: According to 2CFR 200.431(c) the recipient or subrecipient must allocate fringe benefits to Federal awards and all other activities in a manner consistent with the pattern of benefits attributable to the individuals or group(s) of employees whose salaries and wages are chargeable to such Federal awards and other activities, and charged as direct or indirect costs following the recipient's or subrecipient's accounting practices. Condition: The School over-allocated health insurance benefits to the Child Nutrition Cluster.Cause: The School was using an outdated allocation formula that did not reflect changes to personnel in the program. Effect: The School over-allocated health insurance benefits to the Child Nutrition Cluster. Recommendation: We recommend that the School review fringe benefit allocations at the start of each school year, and then at least quarterly throughout the year to monitor for personnel changes that may impact allocations so that allocations may be adjusted timely. Action: As of the date of this exit conference, we will adopt the recommendation. Health benefits will no longer be allocated to the Child Nutrition Cluster. All other fringe benefit costs will be directly allocated.
FAC accepted this audit on January 17, 2025 — management decision was due July 17, 2025.
The client prepared Schedule of Expenditures of Federal Awards (SEFA) understated Child Nutrition Cluster 10.555/10.553 expenses by $19,651 and understated Education Stabilization Fund 84.425U expenditures by $81,428. Lastly, the client prepared SEFA overstated federal expenditures by $69,851 for a federal award that is not subject to single audit requirements. Cause: The School reported 2024 program revenue rather than expenditures for the Child Nutrition Cluster 10.555/10.553. The School's review procedures did not catch a federal award that was excluded from the SEFA, nor a federal award that was included in the SEFA that should not have been. Effect: Audit adjustments were made to increase the Child Nutrition Cluster 10.555/10.553 expenses by $19,651 and increase the Education Stabilization Fund 84.425U expenditures by $81,428. Lastly, and audit adjustment was made to reduce federal expenditures by $69,851 for a federal award that is not subject to single audit requirements. Questioned Costs: None Repeat Finding: Repeat of finding 2023-001. Recommendation: We recommend the School prepare the SEFA utilizing federal award expenditures, rather than revenue. In addition, we recommend that the School's SEFA review procedures include a comparison to the prior year audited SEFA for awards that may have been excluded. Lastly, we recommend that the School research each new federal award on SAM.GOV to determine whether single audit requirements apply. View of responsible officials: See attached corrective action plan.
Show full finding ▾Hide full finding ▴Finding 2024-001, Material Weakness, U.S. DEPARTMENT OF AGRICULTURE Child Nutrition Cluster 10.555 and 10.553, U.S. DEPARTMENT OF EDUCATION Education Stabilization Fund 84.425U Criteria: According to 2CFR 200.510(b), the auditee must prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the financial statements that includes all amounts spent on federal programs subject to single audit during the reporting period. Condition: The client prepared Schedule of Expenditures of Federal Awards (SEFA) understated Child Nutrition Cluster 10.555/10.553 expenses by $19,651 and understated Education Stabilization Fund 84.425U expenditures by $81,428. Lastly, the client prepared SEFA overstated federal expenditures by $69,851 for a federal award that is not subject to single audit requirements. Cause: The School reported 2024 program revenue rather than expenditures for the Child Nutrition Cluster 10.555/10.553. The School's review procedures did not catch a federal award that was excluded from the SEFA, nor a federal award that was included in the SEFA that should not have been. Effect: Audit adjustments were made to increase the Child Nutrition Cluster 10.555/10.553 expenses by $19,651 and increase the Education Stabilization Fund 84.425U expenditures by $81,428. Lastly, and audit adjustment was made to reduce federal expenditures by $69,851 for a federal award that is not subject to single audit requirements. Questioned Costs: None Repeat Finding: Repeat of finding 2023-001. Recommendation: We recommend the School prepare the SEFA utilizing federal award expenditures, rather than revenue. In addition, we recommend that the School's SEFA review procedures include a comparison to the prior year audited SEFA for awards that may have been excluded. Lastly, we recommend that the School research each new federal award on SAM.GOV to determine whether single audit requirements apply. View of responsible officials: See attached corrective action plan.
Criteria: According to 2CFR 200.510(b), the auditee must repare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the financial stat ments that includes all amounts spent on federal programs subject to single audit during the reporting period. Condition: The client prepared Schedule of Federal Expen itures of Federal Awards (SEFA) unde stated the Child Nutrition Cluster 10.555/10.553 expenses by $19,651 and understated Education Stabilization Fund 84.425U expenditures by $81,428. Lastly, the client prepared SEFA overstated federal expenditures by $69,851 for a federal award that is not subject to single audit requirements. Cause: The School reported 2024 program revenue rather than expenditures for the Child Nutrit on Cluster 10.555/10.553. The School's review procedures did not catch a federal award that was excluded from the SEFA, nor a federal award that was included in the SEFA that should not have been. Effect: Audit adjustments were made to increase the Child Nutrition Cluster 10.555/10.553 expenses by $19,651 and increase the Education Stabilization Fund 84.425U expenditures by $81,428. Lastly, an audit adjustment was made to reduce federal expenditures b $69,851 for a federal award that is nit subject to single audit requirements. Recommendation: We recommend the School prepare the SEFA utilizing federal award expenfitures, rather than revenue. In addition, we recommend that he school's SEFA review procedures in 1ude a comparison to the prior year audited SEFA for awards that may have been excluded. Lastly, we recommend that the school research each new federal award on SAM.gov to determine whetlher Single audit requirements apply. Action Taken: As of the date of the exit conference, we have adopted the above recommendations.
2023-001
Finding 2024-004, Significant deficiency Identification of federal program: US DEPARTMENT OF AGRICULTURE passed through the Indiana Department of Education Child Nutrition Cluster 10.553 & 10.555 Criteria : According to 2CFR 200.318(i) the recipient or subrecipient must maintain records sufficient to detail the history of each procurement transaction. These records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price. Condition : The School did not maintain records for a food vendor that met the simplified acquisition threshold for the year. Cause : The Schools procurement policies do not address the frequency of which vendors should be evaluated. In addition, the policies also do not address records retention. Potential effect: The procurement may not have been proper under the grant requirements. Questioned costs: None. Context: A total sample of four (4) of ten (10) purchases related to a certain food provider were selected as a part of procurement and suspension and debarment compliance requirement testing for the Child Nutrition Cluster. Recommendation : We recommend that the School follow federal procurement guidelines for each of the different purchase thresholds for each vendor. We further recommend that the School retain any documentation created related to the procurement selection and vetting process. Views of Responsible Officials: See attached Corrective Action Plan.
Show full finding ▾Hide full finding ▴Finding 2024-004, Significant deficiency Identification of federal program: US DEPARTMENT OF AGRICULTURE passed through the Indiana Department of Education Child Nutrition Cluster 10.553 & 10.555 Criteria : According to 2CFR 200.318(i) the recipient or subrecipient must maintain records sufficient to detail the history of each procurement transaction. These records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price. Condition : The School did not maintain records for a food vendor that met the simplified acquisition threshold for the year. Cause : The Schools procurement policies do not address the frequency of which vendors should be evaluated. In addition, the policies also do not address records retention. Potential effect: The procurement may not have been proper under the grant requirements. Questioned costs: None. Context: A total sample of four (4) of ten (10) purchases related to a certain food provider were selected as a part of procurement and suspension and debarment compliance requirement testing for the Child Nutrition Cluster. Recommendation : We recommend that the School follow federal procurement guidelines for each of the different purchase thresholds for each vendor. We further recommend that the School retain any documentation created related to the procurement selection and vetting process. Views of Responsible Officials: See attached Corrective Action Plan.
Criteria: According to 2CFR 200.318(i) the recipient or subrecipient must maintain records sufficient to detail the history of each procurement transaction. The records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price. Condition: The School did not maintain records for a food vendor that met the simplified acquisition threshold for the year. Cause: The School's procurement policies do not address the frequency of which vendors should be evaluated. In addition, the policies also do not address records retention. Potential Effect: The procurement may not have been proper under the grant requirements. Recommendation: We recommend that the School follow federal procurement guidelines for each of the different purchase thresholds for each vendor. We further recommend that the School retain any documentation created related to the procurement selection and vetting process. Action: As of the date of this exit conference, we will adopt the above recommendations, securing and retaining the appropriate documentation of vendor selection and retention.
FAC accepted this audit on February 5, 2024 — management decision was due August 5, 2024.
Finding 2023-001 Criteria : According to 2 CFR Subpart F Section 200.510b, the auditee must prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period that includes all amounts spent on federal programs during the reporting period. Condition : The Schedule of Expenditures of Federal Awards (SEFA) was overstated by $42,585. Cause : The School included depreciation expense within amounts reported on the SEFA which is not an allowable cost under Uniform Guidance. Effect : An audit adjustment was made to reduce the reported amount on the SEFA for the Child Nutrition Cluster (10.553, 10.555) by $5,988, the Title I, Part A grant (84.010A) by $378, the Student Support and Academic Enrichment Program - Title IV (84.424) by $581, Charter Schools Grant (84.282D) by $95, COVID-19 Elementary and Secondary School Emergency Relief (ESSER II) Fund (84.425D) by $29,896, and the COVID -19 ARP Elementary and Secondary School Emergency Relief (ARP ESSER) Fund (84.425U) by $5,647. Recommendation : We recommend that the School's accountant review and become familiar with Uniform Guidance and CFR 200 requirements to assist with including the accurate expenditure information in the Schedule. In addition, we recommend that the accountant reconcile federal award expenditures to the claims that were filed for the year. View of responsible officials : See attached corrective action plan.
Show full finding ▾Hide full finding ▴Finding 2023-001 Criteria : According to 2 CFR Subpart F Section 200.510b, the auditee must prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period that includes all amounts spent on federal programs during the reporting period. Condition : The Schedule of Expenditures of Federal Awards (SEFA) was overstated by $42,585. Cause : The School included depreciation expense within amounts reported on the SEFA which is not an allowable cost under Uniform Guidance. Effect : An audit adjustment was made to reduce the reported amount on the SEFA for the Child Nutrition Cluster (10.553, 10.555) by $5,988, the Title I, Part A grant (84.010A) by $378, the Student Support and Academic Enrichment Program - Title IV (84.424) by $581, Charter Schools Grant (84.282D) by $95, COVID-19 Elementary and Secondary School Emergency Relief (ESSER II) Fund (84.425D) by $29,896, and the COVID -19 ARP Elementary and Secondary School Emergency Relief (ARP ESSER) Fund (84.425U) by $5,647. Recommendation : We recommend that the School's accountant review and become familiar with Uniform Guidance and CFR 200 requirements to assist with including the accurate expenditure information in the Schedule. In addition, we recommend that the accountant reconcile federal award expenditures to the claims that were filed for the year. View of responsible officials : See attached corrective action plan.
Identification of federal program: U.S. DEPARTMENT OF AGRICULTURE passed through the Indiana Department of Education Child Nutrition Cluster 10.553 & 10.555, U.S. DEPARTMENT OF EDUCATION passed through the Indiana Department of Education Title I, Part A 84.010A, Student Support and Academic Enrichment Program (Title IV) 84.424, Charter Schools Program 84.282D, Education Stabilization Fund 84.425D& 84.425U. Criteria: According to 2 CFR Subpart F Section 200.510b, the auditee must prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period that includes all amounts spent on federal programs during the reporting period. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was overstated by $42,585.Cause: The School included depreciation expense within amounts reported on the SEFA which is not an allowable cost under Uniform Guidance. Effect: An audit adjustment was made to reduce the reported amount on the SEFA for the Child Nutrition Cluster (10.553, 10.555) by $5,988, the Title I, Part A grant (84.010A) by $378, the Student Support and Academic Enrichment Program - Title IV (84.424) by $581, Charter Schools Grant (84.282D) by $95, COVID-19 Elementary and Secondary School Emergency Relief (ESSER II) Fund (84.425D) by $29,896, and the COVID -19 ARP Elementary and Secondary School Emergency Relief (ARP ESSER) Fund (84.425U) by $5,647. Recommendation: We recommend that the School's accountant review and become familiar with Uniform Guidance and CFR 200 requirements to assist with including the accurate expenditure information in the Schedule. In addition, we recommend that the accountant reconcile federal award expenditures to the claims that were filed for the year. Action Taken: Dugger Union Community Schools plans to follow the recommendation given and work with our accountant to do our best to avoid further discrepancies.
FAC accepted this audit on February 22, 2023 — management decision was due August 22, 2023.
Finding 2022-002 U.S. DEPARTMENT OF EDUCATION 84.358A RURAL EDUCATION GRANT Criteria : According to 2 CFR Subpart F Section 200.510b, the auditee must prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period that includes all amounts spent on federal programs during the reporting period. Finding 2022-002 Condition : The Schedule of Expenditures of Federal Awards (SEFA) was materially understated by $33,592. Cause : This was the School's first single audit and the first time for the School's accountant to prepare the SEFA. The School does not have a process in place for School Administrative personnel who are familiar with the School's grants to review the SEFA for accuracy and completeness. Effect : An audit adjustment was made to increase the reported amount on the SEFA for the Rural Education Grant (84.358A) by $38,256 and reduce the reported amount on the SEFA for the Special Education Grants (84.027) by $8,288. The increase in expenditures resulted in the need to select a second federal award for testing. Recommendation : We recommend that the School's accountant work with administrative personnel to identify all awards from federal sources and implement a process whereby School administrative personnel review the SEFA prepared by the accountant. In addition, we recommend that the accountant reconcile federal award expenditures to the claims that were filed for the year. View of responsible officials : See attached corrective action plan.
Show full finding ▾Hide full finding ▴Finding 2022-002 U.S. DEPARTMENT OF EDUCATION 84.358A RURAL EDUCATION GRANT Criteria : According to 2 CFR Subpart F Section 200.510b, the auditee must prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period that includes all amounts spent on federal programs during the reporting period. Finding 2022-002 Condition : The Schedule of Expenditures of Federal Awards (SEFA) was materially understated by $33,592. Cause : This was the School's first single audit and the first time for the School's accountant to prepare the SEFA. The School does not have a process in place for School Administrative personnel who are familiar with the School's grants to review the SEFA for accuracy and completeness. Effect : An audit adjustment was made to increase the reported amount on the SEFA for the Rural Education Grant (84.358A) by $38,256 and reduce the reported amount on the SEFA for the Special Education Grants (84.027) by $8,288. The increase in expenditures resulted in the need to select a second federal award for testing. Recommendation : We recommend that the School's accountant work with administrative personnel to identify all awards from federal sources and implement a process whereby School administrative personnel review the SEFA prepared by the accountant. In addition, we recommend that the accountant reconcile federal award expenditures to the claims that were filed for the year. View of responsible officials : See attached corrective action plan.
Finding 2022-0002 Criteria: According to 2 CFR Subpart F Section 200.Sl0b, the auditee must prepare a Schedule of Expenditures of Federal Awards {SEFA) for the period that includes all amounts spent on federal programs during the reporting period. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was materially understated by $33,592. Cause: This was the School's first single audit and the first time for the School's accountant to prepare the SEFA. The School does not have a process in place for School Administrative personnel who are familiar with the School's grants to review the SEFA for accuracy and completeness. Effect: An audit adjustment was made to increase the reported amount on the SEFA for the Rural Education Grant (84.358A) by $38,256 and reduce the reported amount on the SEFA for the Special Education Grants (84.027) by $8,288. The increase in expenditures resulted in the need to select a second federal award for testing. Recommendation: We recommend that the School's accountant work with administrative personnel to identify all awards from federal sources and implement a process whereby School administrative personnel review the SEFA prepared by the accountant. In addition, we recommend that the accountant reconcile federal award expenditures to the claims that were filed for the year. Action Taken: As of the date of the exit conference, we will institute an in-person quarterly review of each award with the responsible party to ensure costs are appropriately allocated and reimbursements requested. As part of this quarterly review, we will identify the source of the award, year-to-date expenses, grant budget and year-to-date reimbursement claims submitted. The accountant will reconcile federal award expenditures to the claims filed for the year. Furthermore, at year-end, the SEFA will be prepared by the accountant and reviewed by the appropriate administrative personnel for completeness and accuracy.
An LEA must use ESF funds for minor remodeling, renovation or construction contracts that are over $2,000 and use laborers and mechanics that must meet Davis-Bacon prevailing wage requirements. Cause: The School failed to timely notify a certain contractor about the Davis-Bacon Act contract clause requirements related to the prevailing wage rate for contractors and subcontractors. As a result, the contractor did not provide the certified payrolls or statement of compliance. Potential effect: The contractor may not have complied with the wage requirements. Questioned costs: $214,716.62. Context: A total sample of one (1) item related to a certain contractors HVAC project was selected as a part of allowable cost testing for the Education Stabilization Fund. Recommendation: We recommend that the School provide timely communication related to the prevailing wage rate requirements for contracts with future contractors and subcontractors. The School should also ensure that the proper prevailing wage rate clauses are included in future contracts. We further recommend that the School ensure the contractors and subcontractors compliance with the required federal compliance requirements. Views of Responsible Officials: See attached Corrective Action Plan.
Show full finding ▾Hide full finding ▴Finding 2022-003 Identification of federal program: US DEPARTMENT OF EDUCATION 84.425C, 84.425D, and 84.425U Education Stabilization Fund Criteria: Nonfederal entities shall include in their construction contracts subject to the Wage Rate Requirements (which still may be referenced as the Davis-Bacon Act) a provision that the contractor or subcontractor comply with those requirements and the DOL regulations (29 CFR Part 5, Labor Standards Provisions Applicable to Contacts Governing Federally Financed and Assisted Construction) (2 CFR section 200.327; Appendix II.D. to 2 CFR Part 200). This 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) (29 CFR sections 5.5 and 5.6; the A-102 Common Rule (section 36(i)(5)); OMB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.327). Condition: An LEA must use ESF funds for minor remodeling, renovation or construction contracts that are over $2,000 and use laborers and mechanics that must meet Davis-Bacon prevailing wage requirements. Cause: The School failed to timely notify a certain contractor about the Davis-Bacon Act contract clause requirements related to the prevailing wage rate for contractors and subcontractors. As a result, the contractor did not provide the certified payrolls or statement of compliance. Potential effect: The contractor may not have complied with the wage requirements. Questioned costs: $214,716.62. Context: A total sample of one (1) item related to a certain contractors HVAC project was selected as a part of allowable cost testing for the Education Stabilization Fund. Recommendation: We recommend that the School provide timely communication related to the prevailing wage rate requirements for contracts with future contractors and subcontractors. The School should also ensure that the proper prevailing wage rate clauses are included in future contracts. We further recommend that the School ensure the contractors and subcontractors compliance with the required federal compliance requirements. Views of Responsible Officials: See attached Corrective Action Plan.
Finding 2022-0003 Identification of federal program: US Department of Education 84.425C, 84.425D and 84.425U Education Stabilization Fund Criteria: Nonfederal entities shall include in their construction contracts subject to the Wage Rate Requirements (which still may be referenced as the Davis-Bacon Act) a provision that the contractor or subcontractor comply with those requirements and the DOL regulations (29 CFR Part 5, Labor Standards Provisions Applicable to Contracts Governing Federally Financed and Assisted Construction) (2CFR section 200.327; Appendix II D to 2 CFR Part 200). This 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 payroll) (29 CFR section 5.5 and 5.6; the A-102 Common Rule(section 36(i)(S)): 0MB Circular A-110 (2 CFR Part 215, Appendix A, Contract Provisions); 2 CFR Part 176, Subpart C; and 2 CFR section 200.327). Condition: A LEA must use ESF funds for minor remodeling, renovation or construction contracts that are over $2,000 and use laborers and mechanics that must meet Davis-Bacon prevailing wage requirements. Cause: The School failed to timely notify a certain contractor about the Davis-Bacon Act contract clause requirements related to the prevailing wage rate for contractors and subcontractors. As a result, the contractor did not provide the certified payrolls or statement of compliance. Potential Effect: The contractor may not have complied with the wage requirements. Questioned costs: $214,716.62. Context: A total sample of one (1) item related to a certain contractors HVAC project was selected as part of allowable cost testing for the Education Stabilization Fund. Recommendation: We recommend that the School provide timely communication related to the prevailing wage rate requirements for contracts with future contractors and subcontractors. The School should also ensure that the proper prevailing wage rate clauses are included in future contracts. We further recommend that the School ensure the contractors and subcontractors compliance with the required federal compliance requirements. Action: We concur with the recommendation and will implement the appropriate language identifying the prevailing wage rate requirements in future contracts with both contractors and subcontractors. Furthermore, certified payrolls and statements of compliance with be required and tracked for each project.
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