Bradford County District School BoardLocal Government

FINDING - District controls did not always ensure compliance with the Davis-Bacon Act for construction projects exceeding $2,000 and financed by the Federal Education Stabilization Fund, resulting in questioned costs totaling $234,614. CRITERIA -The Federal Education Stabilization Fund provides funding for school facility repairs and improvements. Title 29, Section 5.5, Code of Federal Regulations (Davis-Bacon Act), requires the District to include prevailing wage rate clauses in any construction contract exceeding $2,000 that is financed either wholly or in part by Federal funds and ensure that contractors pay workers the prevailing wage rates established by the United States Department of Labor. This includes a requirement for the contractor to submit to the District weekly, for each week in which any contract work in performed a copy of the payroll and a statement of compliance (certified payrolls). The United States Department of Labor established "prevailing wages" by geographic area and interprets the Davis-Bacon Act to apply to construction, alteration, or repair of a public building or public work. CONDITION - For the 2024-25 fiscal year, the District expended Federal Education Stabilization Fund funds totaling $1.6 million, including $499,130 based on a contract for roofing, heating, ventilation, and air conditioning (HVAC); and building automation upgrade services; and $46,373 based on a contract for flooring services. While the contract for roofing, HVAC, and building automation upgrade services included a general requirement to comply with the Davis-Bacon Act provisions, neither that contract nor the flooring services contract explicitly required submittals of weekly certified payrolls demonstrating that prevailing wage rates were paid. Subsequent to our inquiry, in October 2025 the District obtained certified payrolls from the contractor for the HVAC work completed; however, certified payrolls were not obtained for expenditures totaling $234,614 for roofing, building automation upgrade, and flooring services. CAUSE - District contracts did not specifically require contractors to submit weekly certified payrolls to the District and District procedures had not been established to require District personnel to verify that payrolls were received. EFFECT - Absent the required contract clauses and weekly certified payrolls, there is an increased risk that construction contractors paid with Federal moneys will not pay workers the prevailing wage rates established by the United States Department of Labor. Although we requested, the District did not obtain certified payrolls from the contractors demonstrating that the prevailing wage rates were paid for certain services, resulting in questioned costs totaling $234,614. RECOMMENDATION - The District should enhance procedures to ensure compliance with all Davis-Bacon Act requirements. Such enhancements should include provisions in applicable contracts requiring weekly submittals of certified payrolls and District procedures documenting verifications that the payrolls were received. In addition, the District should document to the FDOE allowability of the questioned costs or contact the FDOE regarding necessary corrective action. DISTRICT RESPONSE - District procedures have been put in place to ensure that the Davis-Bacon Act requirements to submit weekly payroll certifications will be included in all contract language for federally funded projects as well as on our purchase orders. The finance department will continue to follow up with vendors to ensure payroll certifications are collected before invoice payments are made.

Finding - District controls did not always ensure compliance with the Davis-Bacon Act for Federally funded construction projects exceeding $2,000, resulting in questioned costs totaling $131,819. Criteria - The ES Fund provides Federal funds for school facility repairs and improvements to reduce the risk of virus transmission and exposure to environmental health hazards and to support student health needs. According to the FDOE-approved grant document, the District received this funding, in part, to repair or replace gymnasium flooring so students can safely participate in physical education classes and to provide additional spacing options for social distancing and seating should the need arise. Title 29, Section 5.5, Code of Federal Regulations (Davis-Bacon Act), requires the District to include prevailing wage rate clauses in any construction contract exceeding $2,000 that is financed either wholly or in part by Federal funds and ensure that contractors pay workers the prevailing wage rates established by the United States Department of Labor. This includes a requirement for the contractor to submit to the District weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). The United States Department of Labor established “prevailing wages” by geographic area and interprets the Davis-Bacon Act to apply to construction, alteration, or repair of a public building or public work. Condition - During the 2022-23 fiscal year, the District expended ES Fund moneys totaling $4,575,438. The expenditures included $131,819 related to a construction contract for removal, disposal, and installation of gymnasium flooring. We noted that the purchase orders, request for proposal, bid specifications, and contract did not include clauses that required compliance with the Davis-Bacon Act provisions and the contractors did not submit weekly certified payrolls to the District. Cause - District personnel were not aware that the Davis-Bacon Act applied to this Federally funded project and, therefore, did not include the appropriate wage rate clauses in the applicable procurement documents nor require District personnel to verify that certified payrolls were received. Effect - Absent required contract clauses and weekly certified payrolls, there is an increased risk that construction contractors paid with Federal moneys will not pay workers the prevailing wage rates established by the United States Department of Labor. Although we requested, the District did not provide the certified payrolls from the contractor demonstrating that the prevailing wage rates were paid for the project. Consequently, the District incurred questioned costs totaling $131,819. Recommendation - The District should enhance procedures to ensure compliance with all Davis-Bacon Act requirements. Such procedures should ensure that applicable Federally funded construction contracts require submittal of weekly certified payrolls and that District personnel verify the payrolls are received and demonstrate that prevailing wage rates are paid. In addition, the District should document to the FDOE the allowability of the questioned costs or contact the FDOE regarding necessary corrective action.

Finding: The District did not always comply with the Federal requirements for quarterly reporting information for the ESF - HEERF Student Aid Portion. Criteria: Title 2, Section 200.303, Code of Federal Regulations, requires the District to establish and maintain effective internal controls over Federal awards that provide reasonable assurance that the District is managing Federal awards in compliance with the Federal Statutes, regulations, and the terms and conditions. In addition, recipients of funding from the ESF ? HEERF Student Aid Portion are required to report no later than 10 days following the end of each calendar quarter in a format and location that is easily accessible to the public: - The total amount of Emergency Financial Aid (EFA) Grants distributed to students as of the date of the report. - The estimated total number of students at the District that are eligible to receive EFA Grants. - The total number of students who have received an EFA Grant. - The method(s) used by the District to determine which students receive the EFA Grants and how much they would receive. Condition: During the 2021-22 fiscal year, the District had ESF expenditures totaling $3.2 million, including $220,623 expended for the ESF ? HEERF Student Aid Portion. The ESF ? HEERF Student Aid Portion provided students with EFA Grants to help cover expenses related to the disruption of campus operations due to the COVID-19 pandemic. As of part of our audit, we requested for examination District records to demonstrate whether the required quarterly reports contained the required information and were made accessible to the public. In response to our inquiry, District personnel directed us to the District Web site, which included ESF ? HEERF Student Aid Portion quarterly reports for the periods ended September 2021 and December 2021. However, the reports only included the total amounts of EFA Grants distributed to students for the periods of those reports and no information was reported for the periods ended March 2022 and June 2022. Cause: District personnel indicated that the deficient reporting occurred due to staff turnover and the lack of training and supervisory review and approval procedures. Effect: Absent all required information in quarterly reports, the District did not comply with Federal program reporting requirements and the public?s ability to analyze, monitor, and evaluate the District?s administration of the ESF ? HEERF Student Aid Portion was limited. Recommendation: The District should establish procedures to ensure that the quarterly reports for the ESF ? HEERF Student Aid Portion contain all required information and are made accessible to the public. Such procedures should include appropriate training for District personnel and supervisory review and approval to verify the timeliness and accuracy of the information reported. District Response: The District agrees with the finding. The District will ensure that staff is trained on procedures to ensure compliance in the future with Federal quarterly reporting guidelines.

CFDA Numbers 10.553, 10.555, 10.559; 84.425D; 84.010; and 84.027 and 84.173 Program Title Major Program: Child Nutrition Cluster (CNC) and Education Stabilization Fund (ESF) Nonmajor Programs: Title I Grants to Local Educational Agencies (Title I), and Special Education Cluster (SEC) Compliance Requirement Allowable Costs/Cost Principles Pass-Through Entity Florida Department of Agriculture and Consumer Services (FDACS) and Florida Department of Education (FDOE) Federal Grant/Contract Number and Grant Year FDACS/CNC: 215FL915N1099 ? 2021, 215FL915N1199 ? 2021 FDOE/ESF: S425D200052 ? 2021 FDOE/Title I: S010A190009 ? 2021 FDOE/SEC: H173A190027 ? 2021, H027A190024 ? 2021 Statistically Valid Sample Not Applicable Finding Type CNC and ESF: Noncompliance and Questioned Costs Greater than $25,000 Title I and SEC: Questioned Costs Greater than $25,000 Questioned Costs CNC: $42,115.75 ESF: $25,917.44 Title I: $35,846.60 SEC: $63,583.77 Prior Year Finding 2020-001, Report No. 2021-161 Finding The District charged Federal programs for health insurance premiums for certain employees who did not participate in the District health insurance program, resulting in Federal program questioned costs totaling $167,463.56. Criteria Title 2, Section 200.403, Code of Federal Regulations (CFR), provides that, for an expenditure to be allowable under Federal awards, costs must be necessary and reasonable for the performance of the Federal award and must be adequately documented. Title 2, Section 200.431, CFR, provides that fringe benefits, including employee insurance, are allowable costs of Federal awards if they are reasonable and are required by law, non-Federal entity-employee agreement, or an established policy of the non-Federal entity. Condition For the 2020-21 fiscal year, the District provided employee health insurance as an employee fringe benefit and the Board authorized District contributions for individual and family coverage, including contributions for Federally funded employees. The District recorded health insurance expenditures for each employee per pay period, although some Federally funded employees did not participate in the District health insurance program. Based on our discussions with District personnel and examination of District records, we determined that the District charged Federal programs for health insurance premiums totaling $167,463.56 for certain employees who did not participate in the District health insurance program. Cause According to District personnel, District personnel did not monitor the health insurance program participants and related expenditures to ensure that the premium costs were only recorded for health insurance program participants. District personnel also agreed with the questioned costs calculations totaling $167,463.56. Effect The District did not comply with Federal regulations that require all Federal expenditures to represent reasonable and necessary charges. Consequently, the District incurred questioned costs totaling $42,115.75 for the CNC; $25,917.44 for the ESF; $35,846.60 for the Title I Program; and $63,583.77 for the SEC. Recommendation The District should establish procedures to monitor the health insurance program participants and related expenditures to ensure that premium costs are only recorded for program participants. Also, the District should document to the respective grantors the allowability of questioned costs of $167,463.56 or restore these moneys to the appropriate Federal programs. District Response The District is in the process of reviewing the payroll deduction codes to ensure that the health insurance premiums are being accurately applied. The District will evaluate overpayments as necessary and make the necessary corrections.

CFDA Numbers 84.425E; 84.425F; and 84.425N Program Title Major Program: Education Stabilization Fund Grant Program (ESF Program): Higher Education Emergency Relief Fund (HEERF) Student Aid Portion HEERF Institutional Portion HEERF Fund for the Improvement of Postsecondary Education (FIPSE) Formula Grant Compliance Requirement Cash Management Pass-Through Entity Not Applicable Federal Grant/Contract Number and Grant Year P425E205222; P425F203441; P425N200636 Statistically Valid Sample Not Applicable Finding Type Noncompliance and Significant Deficiency Questioned Costs Not Applicable Prior Year Finding Not Applicable Finding The District did not always comply with Federal cash management requirements to minimize the time elapsing between the receipt and disbursement of ESF Program ? HEERF award funds. As a result, the District retained unexpended Program funds totaling $994,795 at June 30, 2021, which represent Program questioned costs. Criteria Title 2, Section 200.305, CFR, requires the District to minimize the time elapsing between the transfer of funds from the United States Treasury and the disbursement by the District. In addition, the Terms and Conditions in the ESF Program ? HEERF award notifications require the District to liquidate funds drawn down from the Federal grants management system within 15 days of receipt. Condition The District administered the ESF Program ? HEERF awards at the North Florida Technical College and during the 2020 21 fiscal year drew down award receipts totaling $1,190,911. However, as of June 30, 2021, the District had expended only $196,116 of the awarded funds and had held amounts beyond the required liquidation dates (15 days after receipt) as shown below. Federal HEERF Funds Drawn and Expended 2020-21 Fiscal Year Draw Down Date Amount Drawn Down Amount Expended Amount Remaining as of 6/30/21 As of 6/30/21, Number of Days Beyond Required Liquidation Date 8/14/20 $ 134,851 $128,691 $ 6,160 305 1/29/21 $ 614,815 $ 67,425 $547,390 137 5/14/21 $ 441,245 $ - $441,245 32 Total Drawn, Expended, and Remaining $1,190,911 $196,116 $994,795 Cause The District had not established controls to effectively monitor the Federal cash management requirements because of personnel turnover and staff were not aware of the requirements. Effect Absent effective procedures to require prompt disbursements of cash draws, there is an increased risk that the District will not comply with Federal cash management requirements. As of June 30, 2021, the District retained, beyond the required liquidation dates, unexpended ESF Program ? HEERF award funds totaling $994,795, which represent questioned costs of that Program. Recommendation The District should establish effective procedures to minimize the time elapsing between the transfer of funds from the United States Treasury and the disbursement of those funds. In addition, the District should demonstrate to the Federal grantor that the District expended eligible ESF Program ? HEERF award funds totaling $994,795 during the grant period or restore that amount to the grantor. District Response The District will enhance procedures to the Federal cash management requirements to ensure that the disbursement of Federal program monies stay in compliance of the time requirement of allowable expenditure reimbursement.

Finding Number 2020-001 CFDA Numbers 84.010; 10.553, 10.555, 10.559; 84.027 and 84.173 Program Title Major Program: Title I Grants to Local Educational Agencies (Title I) Nonmajor Programs: Special Education Cluster (SEC) and Child Nutrition Cluster (CNC) Compliance Requirement Allowable Costs/Cost Principles Pass-Through Entity Florida Department of Education (FDOE) and Florida Department of Agriculture and Consumer Services (FDACS) Federal Grant/Contract Number and Grant Year FDOE/Title I: S010A190009 - 2020 FDOE/SEC: H173A190027 ? 2020, H027A190024 - 2020 FDACS/CNC: 18075 ? 2020 Statistically Valid Sample Not Applicable Finding Type Title I: Noncompliance and Questioned Costs Greater than $25,000 CNC and SEC: Questioned Costs Greater than $25,000 Questioned Costs Title I: $48,504.28 SEC: $48,689.54 CNC: $35,830 Prior Year Finding Not Applicable Finding The District charged Federal programs for health insurance premiums for certain employees who did not participate in the District health insurance program, resulting in Federal program questioned costs totaling $133,023.82. Criteria Title 2, Section 200.403, Code of Federal Regulations (CFR), provides that, for an expenditure to be allowable under Federal awards, costs must be necessary and reasonable for the performance of the Federal award and must be adequately documented. Title 2, Section 200.431, CFR, provides that fringe benefits, including employee insurance, are allowable costs of Federal awards if they are reasonable and are required by law, non-Federal entity-employee agreement, or an established policy of the non-Federal entity. Condition For the 2019-20 fiscal year, the District provided employee health insurance as an employee fringe benefit and the Board authorized District contributions for individual and family coverage, including contributions for Federally funded employees. The District recorded health insurance expenditures for each employee per pay period, although some Federally funded employees did not participate in the District health insurance program. Based on our discussions with District personnel and examination of District records, we determined that the District charged Federal programs for health insurance premiums totaling $133,023.82 for certain employees who did not participate in the District health insurance program. Cause According to District personnel, District personnel did not monitor the health insurance program participants and related expenditures to ensure that the premium costs were only recorded for health insurance program participants. District personnel also agreed with the questioned costs calculations totaling $133,023.82. Effect The District did not comply with Federal regulations that require all Federal expenditures to represent reasonable and necessary charges. Consequently, the District incurred questioned costs totaling $48,504.28 for the Title I Program, $48,689.54 for the SEC, and $35,830 for the CNC. Recommendation The District should establish procedures to monitor the health insurance program participants and related expenditures to ensure that premium costs are only recorded for program participants. Also, the District should document to the respective grantors the allowability of questioned costs of $133,023.82 or restore these moneys to the appropriate Federal programs. District Response We recognize the importance of properly charging all programs (both Federal and Non-Federal) with only those costs attributable and allowable under the specific program. Specifically, to address the deficiency as it relates to the District health insurance program, for the 2020-21 fiscal year, the District will establish an Internal Service Fund to account for all of the employee health insurance activity. The Internal Service Fund will allow for better monitoring of employee participation in the program and charge specific programs for only those employee participants authorized and verified.