Recurring Findings

Transportation: Recurring Material Internal Control Deficiencies
Federal Program Issue First Year Reported
Department's Assertion Page Number
High-Speed Rail Corridors and Intercity Passenger Rail Service - Capital Assistance Grants (High Speed Rail) During our audit for fiscal year 2012-13, we reported that Caltrans did not have procedures in place to comply with federal Davis-Bacon Act requirements because it did not obtain certified weekly payrolls from contractors for the High Speed Rail program. In fiscal year 2013-14, Caltrans had not yet implemented procedures to obtain the weekly certified payrolls. Failure to obtain the required weekly certified payrolls increases the risk of noncompliance with Davis-Bacon Act requirements. 2012-13
Caltrans currently has approved Davis-Bacon compliance language. For future contracts, Caltrans Legal will determine Davis-Bacon applicability and this determination will be documented in the project file. For future contracts under which Davis-Bacon does apply, Caltrans will ensure that the appropriate language is included in the contract and weekly certified payrolls will be required to be submitted by the contractor with their invoice reimbursement requests. Caltrans Legal is in the process of reviewing all existing contracts to determine the applicability of Davis Bacon provisions and whether the proper language was included in the contracts if Davis-Bacon does apply. Once it is determined which contracts require Davis-Bacon, and that the proper language was included in the contract, contract managers will notify the contractor to submit weekly certified payrolls. Caltrans Legal has completed its review of the contract funded by Grant number FR HSR 0022 11-01-00. Legal determined that Davis-Bacon does apply but that the contract did not contain Davis-Bacon compliance language. Caltrans will seek to amend this contract to add the Davis-Bacon requirement. If the contractor does not agree to amend, Caltrans will not be able to require submission of certified weekly payrolls. Regarding the status of the remaining two grants, the contract for Grant number FR-HSR-0058-11-01-01 was completed as of August 31, 2014 and is in the process of closeout with FRA. Further, Caltrans Legal is still in the process of reviewing the contract for Grant number FR-HSR-0021-11-01-01. 42
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