TUBA CITY UNIFIED SCHOOL DISTRICT NO.15

2025-002 Title I Payroll Federal Assistance Listing Number: 84.010 Program Title: Title I LEA Federal Agency: U.S. Department of Education Passthrough Entity: Arizona Department of Education Passthrough Number: 25FT1TTI-511183-01A Compliance Requirement: B. Allowable Cost/Cost Principles Award Period: July 1, 2024 – June 30, 2025 Finding Type: Noncompliance, Significant Deficiency in Internal Control Questioned Costs: N/A Repeat Finding: No. Condition/Context: The District does not have a system in internal control to properly track the time worked in federal projects. For four out of 25 Title I payroll transactions tested, the employees were completely paid using Title I monies, however the hours reported on the timecard for grant activities did not agree with the total hours worked. Criteria: Payroll made with federal project fund should be supported by documentation showing the hours worked with the activities approved as for the federal project. Effect: Without proper internal controls over time tracking and approval for federal programs, the District could overpay or underpay the portion of payroll for the federal program without detecting the error. Cause: Management oversight. Recommendation: We recommend the District have a second employee verify and approve time sheets for works related to federal projects. Views of Responsible Officials: There is no disagreement with this finding.

2023-001 Davis-Bacon Act Compliance CFDA Number 84.041 Program Title Impact Aid Federal Agency U.S. Department of Education Compliance Requirement N. Special Tests and Provisions Finding Type Noncompliance, Significant Deficiency Questioned Costs N/A Repeat Finding: Yes, Similar to 2022-001. Condition/Context: The District did not retain documentation sufficient to determine the Davis-Bacon compliance clause was included in advertised specifications for one construction project paid with federal Impact Aid funds. Criteria: Department of Labor (DOL) 29 CFR part 5, Labor Standards Provisions Applicable to Contracts Governing Federally Financed and Assisted Construction. Non-federal entities shall include in their federally funded construction contracts in excess of $2,000, that are subject to the Wage Rate Requirements of the Davis-Bacon Act, a provision that the contractor or subcontractor comply with those requirements and the DOL regulations. This includes a requirement for the contractor or subcontractor to submit to the U.S. Department of Labor weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). This reporting is often done using Optional Form WH-347, which includes the required statement of compliance. Effect: The District was not in compliance with the notification requirements of the Davis-Bacon Act. As a result, the contractor could be subject to penalties and fines, and possible debarment from federal contracting if prevailing wages were not paid. Cause: The District did not have the adequate review procedures in place to ensure bid documents included notification that federal Impact Aid monies were to be used for payment of the construction projects and the contractors needed to be in compliance with the Davis-Bacon Act. Recommendation: We recommend that the District establish proper review procedures of bid documents to ensure that any federally funded construction projects in excess of $2,000 the contractors are notified the projects are being funded with federal Impact Aid funds and the contractors are required to be in compliance with the Davis Bacon Act.