Office of Information Technology Services
Procurement and Contracting Practices
Issued: February 28, 2012
Link to full audit report 2010-S-71
Purpose
To determine whether the Office for Technology’s (OFT) procurement and contracting practices resulted in the best value for taxpayers, consistent with applicable legal, regulatory and ethical requirements. The audit covers the period April 1, 2008 through December 2, 2011.
Background
OFT plays a highly significant strategic and technology procurement role in State government. The agency serves as one of the State’s principal technology procurement entities responsible for what should be competitive and efficient procurement of some of the State’s largest non-capital contracts. In October 2010, the State Comptroller rejected a contract submitted by OFT for staff augmentation valued at $7.5 billion. The Comptroller cited flawed cost evaluation methodologies in the rejection and determined the value of the contract appeared to overstate IT consultant spending in the State. As a result, the Comptroller ordered a full-scale independent audit of OFT’s contracting and procurement practices be conducted by his Division of State Government Accountability.
Key Findings
This report provides details surrounding several major problems and potential ethics violations, including how:
- OFT wasted $1.5 million in a contract with McAfee;
- Deputy CIO Rico Singleton used his official position in apparent violation of the Public Officers Law;
- Unfair bidding practices and inappropriate negotiations with vendors regarding contract terminations; and
- Discretionary purchases exhibit disregard for requirements.
Key Recommendations
The Comptroller has referred Mr. Singleton’s possible violations of the Public Officers Law to the Joint Commission on Public Ethics. In addition, OFT should take significant steps to change its organizational culture and control environment to ensure that proper contracting and purchasing practices are put in place and complied with. This includes complying with existing controls and safeguards to prevent fraud, waste and abuse of State resources, and monitoring their actual implementation to ensure that unethical practices will not occur in the future.
Other Related Audits/Reports of Interest
Office of Mental Retardation and Developmental Disabilities: Preservation Fund Procurement Practices at Springbrook NY, Inc. Report 2007-S-51
Office of Mental Retardation and Developmental Disabilities: Physical Plant Procurement Practices at Central New York Developmental Disabilities Services Office Report 2007-S-136
State Government Accountability Contact Information:
Audit Director: John Buyce
Phone:(518) 474-3271; Email: StateGovernmentAccountability@osc.state.ny.us
Address: Office of the State Comptroller; Division of State Government Accountability; 110 State Street, 11th Floor; Albany, NY 12236
