audit_findings: 15

This data as json

rowid	source	report_number	finding_number	muni_id	state	entity_name	entity_type	entity_ext_id	place_geoid	match_method	auditor	report_title	audit_type	fiscal_year	period_start	period_end	published_date	finding_category	severity	questioned_cost	cost_basis	finding_title	finding_text	report_url	fetched_at
15	wa-sao	1020366	2016-002		WA	City of Chehalis	City/Town	0487	5311475	no_match	Washington State Auditor's Office	Financial and Federal audit — City of Chehalis	Financial and Federal	2016	2016-01-01	2016-12-31	2019-03-28	federal_award_compliance	material_weakness	0.0	Questioned Cost Amount: $0	The City did not have adequate internal controls to ensure compliance with federal Davis -Bacon Act (prevailing wage) requirements. CFDA Number and Title: 20.106 Airport Improvement Grant Federal Grantor Name: Federal Aviation Administration, U.S. Department of Transportation Federal Award/Contract Number: 3-53-0012-017-2016 Pass-through Entity Name: NA Pass-through Award/Contract Number: NA Quest	Background During fiscal year 2016, the City of Chehalis spent $692,210 through the Airport Improvement Grant. The Davis-Bacon Act (Act) requires that all laborers and mechanics employed by contractors or subcontractors to work on construction contracts of more than $2,000 financed with federal funds must be p aid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor. The A ct includes a requirement for the contractor or subcontractor to submit to the City weekly, for each week in which any contract work is performed, a copy of its payroll and a statement of compliance (weekly certified payroll). Description of Condition The City did not have an adequate process in place to ensure contractors and subcontractors working on federal grant -funded projects filed week ly certified payrolls. Washington State Auditor’s Office Page 10 We consider this internal control deficiency to be a material weakness, which led to material noncompliance. This issue was not reported as a finding in the prior audit. Cause of Condition The City did not dedicate the necessary resources to develop an adequate system of monitoring and review to ensure weekly certified payrolls were submitted by all contractors and subcontractors. The City did not know it could assess sanctions for contractor noncompliance with this requirement. Effect of Condition and Questioned Costs The City did not obtain all weekly certified payrolls for the Chehalis -Centralia Airport Apron Rehabilitation project. Our audit found that 28 of the 104 required weekly certified payroll reports were not obtained d uring 2016. The missing weekly certified payroll reports were all from subcontractors. Without adequate internal controls, the City cannot demonstrate workers were paid prevailing wages as required by the Act. The City could be liable for paying additional wages if prevailing wages were not paid. Recommendation We recommend the City implement internal controls to ensure compliance with the Act’s requirements, including implementing an effective process to ensure all weekly certified payrolls are collected. This could include actions such as assessing sanctions on noncompliant contractors in accordance with Standard Specifications until certified payroll reports are received for all hours worked during each pay period. City ’s Response The City would like to thank the State Auditor’s Office for their recommendations and assistance throughout the audit. The City hired an engineering firm to oversee the program, including obtaining weekly certified payrolls from the contractors and subcontractors. It was verifi ed, after the initial auditor’s requests for records, that the required weekly certified payrolls from the contractors and subcontractors had been obtained by the engineering firm with some exceptions and were available at the engineering firm. However, the City staff was unaware of the federal requirements during the audit, Washington State Auditor’s Office Page 11 and the City did not have controls in place to ensure and monitor that the engineering firm was complying with the grant requirements. The City had staff turnover at the Airport during the grant period. The City’s former Airport Director resigned in August 2017. The City’s new Airport Operations Coordinator has taken over the grant project but was unaware of the federal grant requirements of Davis-Bacon Act. For future Airport grants, t he City will create a checklist and monitor the engineering firm to ensure all grant requirements are met. In addition, the Airport staff will attend a federal grant training to gain knowledge of federal grant requirements. Auditor’s Remarks We appreciate the City’s commitment to resolve this finding. We will review the corrective action taken during our next regular audit. We th ank the City for its cooperation and assistance during the audit. Applicable Laws and Regulations The American Institute of Certified Public A ccountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, paragraph 11. Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 200.303 Internal controls, establishes internal control requirements for management of Federal awards to non-Federal entities. Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 200.516 Audit findings, establishes reporting requirements for audit findings. Title 29, U.S. Code of Federal Regulations (CFR), Section 5.5 – Contract provisions and related matters, establishes required contract provisions with regard to prevailing wages. Title 29, U.S. Code of Federal Regulations (CFR), Section 3.3 – Weekly statement with respect to payment of wages establishes weekly certified payroll requirements. Washington State Auditor’s Office Page 12	https://portal.sao.wa.gov/ReportSearch/Home/ViewReportFile?arn=1020366&isFinding=false&sp=false	2026-07-30 13:24:54