Paragon Management, Inc. dba Paradise SchoolsNon-Profit

Finding Number: 2022-001 Repeat Finding: No Program Name/Assistance Listing Title: Education Stabilization Fund Assistance Listing Numbers: 84.425U Federal Agency: U.S. Department of Education Federal Award Number: S425U210038 Pass-Through Agency: N/A Questioned Costs: Unknown Type of Finding: Noncompliance, Significant Deficiency Compliance Requirement: Special Tests and Provisions CRITERIA All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141-3144, 3146, and 3147). CONDITION It could not be determined whether laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by federal assistance funds were paid equal to or in excess of the prevailing wage rate for the locality. The sample was not intended to be, and was not, a statistically valid sample. CAUSE The School was unaware that grant monies expended on construction and minor remodeling were subject to wage rate requirements. EFFECT The School did not comply with the special tests and provisions requirements of the grant. CONTEXT The School did not notify contractors and subcontractors of the requirements to comply with the wage rate requirements and did not obtain copies of certified payrolls for construction projects funded with grant monies. RECOMMENDATION The School should expand existing procedures for wage rate requirements to include construction and minor remodeling expenditures. VIEWS OF RESPONSIBLE OFFICIALS See Corrective Action Plan.

Finding Number: 2019-001 Repeat Finding: No Program Name/CFDA Title: Special Education Cluster CFDA Number: 84.027 Federal Agency: U.S. Department of Education Federal Award Number: H027A180007 Pass-Through Agency: Arizona Department of Education Questioned Costs: N/A Type of Finding: Noncompliance, Significant Deficiency Compliance Requirement: Procurement, Suspension and Debarment CRITERIA Non-Federal entities are prohibited from contracting with or making sub awards under covered transactions to parties that are suspended or debarred. ?Covered transactions? include those procurement contracts for goods and services awarded under a non-procurement transaction that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. Additionally, the Uniform Guidance 2 CFR 200.318 and 320 outline required procurement standards and methods of procurement to be followed. CONDITION Verification of suspension and debarment was not performed for all vendors with whom the School spent at least $25,000 using federal grant monies and the School did not obtain price quotations from an adequate number of sources. CAUSE The School has not established procedures to ensure suspension and debarment checks were done. Additionally, School policies for procurement were not always followed. EFFECT The School was not in compliance with the requirements set forth by the federal government. However, it was determined that the vendors in questions were not suspended or debarred. CONTEXT The School did not ensure that two vendors were not suspended or debarred. For one vendor, the School did not obtain price quotations from an adequate number of sources; the School obtained two price quotations, however, School policy requires three. RECOMMENDATION The School should establish procedures to ensure suspension and debarment checks are done and should develop a process to ensure the checks are performed. In addition, the School should develop a process to ensure the policies regarding price quotations are performed. VIEWS OF RESPONSIBLE OFFICIALS See Corrective Action Plan.