Purpose

To determine whether the Dormitory Authority of the State of New York (Authority) monitors the contractors and sub-contractors on its projects to ensure they pay employees at the prevailing wage rate. The audit covered the period January 1, 2014 through June 17, 2016.

Background

The Authority’s purpose is to finance and construct buildings for a variety of public and not-forprofit entities, including universities, health care facilities, and State agencies. Most Authority construction contracts require the contractors to pay prevailing wages. The Department of Labor (Labor) assists the Authority by enforcing compliance with Article 8, Section 220 of the State Labor Law on Public Work (Article 8) that requires payment of prevailing wages. Labor requires agencies and authorities such as the Authority to advertise a project as a Public Work, provide contractors with the appropriate prevailing wage rate schedule for the project, and perform a review of certified payrolls submitted by contractors to demonstrate they paid prevailing wages.

Key Findings

• The Authority has implemented appropriate controls to meet its specific Article 8 responsibilities, which are to: properly advertise prevailing wage construction projects; ensure contractors file an original payroll; and review whether the payrolls include all required information. However, although Authority project managers and field representatives site visited construction projects, they did not routinely inspect the sites to ensure that prevailing wage rates were posted, as required.
• In addition to the aforementioned activities, the Authority has an agreement with Labor (Agreement) to fund an Investigator dedicated to enforcement of the prevailing wage law on Authority projects in the New York City area. The Authority could improve its controls by obtaining documentation that detailed the Investigator’s work and helped officials to determine if the services provided, and the results achieved, adequately fulfilled the requirements of the Agreement.

Key Recommendations

• Ensure Authority project managers and/or field representatives periodically verify prevailing wage postings on job sites. Require verifications of wage postings to be documented.
• Require Labor to provide the Authority with periodic reports that sufficiently detail the nature and results of the Investigator’s monitoring efforts regarding Authority construction projects.

Other Related Audits/Reports of Interest

Dormitory Authority of the State of New York: Contract Participation of Minority- and Women-Owned Business Enterprises (2014-S-7)
Office of Mental Health: OMH Contract With Shorefront Mental Health Board - Compliance With Prevailing Wage Law (2013-S-62)