Figure 1
Figure 1 is an organization chart that describes the multiple units within General Services that approve contracts that are exempt from competition. Within the Department of General Services, there are two divisions that approve contracts. The Office of Legal Services Reviews and approves all non-IT service contracts over $50,000 or $150,000, depending on the contracting agency. The second division, the Procurement Division, includes several branches, but the two that are involved in processing contracts exempt from competition are the Strategic Sourcing and Acquisitions Branch and the Policy, Training, and Customer Services Branch. The Strategic Sourcing and Acquisitions Branch is over the One-Time Acquisitions Unit, which is responsible for conducting procurements of non-IT goods and IT goods and services on behalf of agencies if those procurements exceed the agency’s purchasing authority and are not related to reportable IT projects. The Policy, Training, and Customer Services Branch is broken down further into the Dispute Resolution Unit, which facilitates resolution of contract disputes and approves or denies noncompetitive requests for all types of contracts, and the Purchasing Authority Unit, which establishes dollar thresholds under which agencies have the authority to procure non-IT goods and IT goods and services. These units have other roles; however we only include detail as it pertains to contracts exempt from competition.
Figure 2
Figure 2 is a flowchart that outlines the review process of acquisitions for goods and services that are exempt from competition and valued over $1 million. If an agency wishes to acquire a good or service within General Services’ purview either competitively or noncompetitively, the agency must first determine whether the purchase falls within its delegated purchasing authority. If it does, the agency can conduct the procurement itself. However, if the cost of the acquisition exceeds the agency’s purchasing authority and the procurement is within General Services’ purview, the agency must submit a contract or noncompetitive request to General Services for review. If the procurement is exempt from competitive bidding by statute or policy but does not involve a noncompetitive request, it moves directly to Legal Services or the Procurement Division for final review. If the agency asserts that a unique circumstance exists, it completes a noncompetitive request and submits it to the Dispute Resolution Unit for review. Once the Dispute Resolution unit has approved the noncompetitive request, the agency must submit the contract to either Legal Services or one of the other units in General Services’ Procurement Division for review. Legal Services must approve all such procurements of non-IT services, while the Purchasing Authority unit is responsible for one-time authorizations for agencies to execute their own contracts for non-IT goods or IT goods and services. Finally, if called for, General Services’ One-Time Acquisitions Unit executes one-time acquisitions on behalf of the agencies. If at any step in this process approval is denied, the acquisition is cancelled, bid competitively, or processed again using another exemption.
Figure 3
Figure 3 shows two types of errors we found in the SCPRS data and how they misrepresent noncompetitive procurements. The first example contains noncompetitive amendments misrepresented as competitive. The contract was originally competitively bid for $3 million and had 9 noncompetitive amendments for $31 million. However, SCPRS incorrectly showed $34 million as competitive. The second example displays when a contract is missing from the database. When this occurs, the entire contract amount goes undocumented in SCPRS, which would misrepresent the State’s contracting.
Figure 4
Figure 4 describes why General Services’ and Technology’s databases are inadequate for accurately identifying contracts over $1 million for fiscal years 2011-12 through 2015-16. It shows the four logs or databases from General Services and the list of contracts and noncompetitive requests Technology provided. For General Services, of the four data sources, two, the Purchasing Authority log and the One-Time Acquisitions log do not clearly distinguish between competitive and noncompetitive contracts and contain inconsistent dollar amounts. Therefore, the number of items and dollar amounts from these two data sources are unknown. The third and fourth data sources, the Limited Competition database and the Office of Legal Services contracts database, contain inaccuracies related to dollar amounts and procurement method (competitive or noncompetitive), respectively. Finally, we found that contracts and justification requests were missing from the list Technology provided. Because of our data concerns, the precise totals are unknown. Despite our concerns with the integrity of the data, we estimate that General Services and Technology procured $44.7 billion through 2,682 items through noncompetitive procurements, $16.6 billion through 1,415 items through competitive procurements, and $6.8 billion through 529 items through an unknown procurement method.
Figure 5
Figure 5 is a comparison that outlines the differences between data input in SCPRS and FI$Cal when procurement for goods and services are made. From 2003 to 2015, state agencies engaged in two steps: procuring goods and services and then manually reporting that procurement in SCPRS. Starting in January 2016, any agencies that are not yet using FI$Cal for their procurements—because they are scheduled to use the system in the future, they have deferred transitioning to the new system, or they are not required to use it—generally must continue to manually report contract information into the system. For agencies using FI$Cal for their procurements, it automatically records the contract information into FI$Cal. According to FI$Cal’s sixth special project report, the final state agencies are scheduled to begin using FI$Cal in July 2018. However, our office’s January 2017 report on the implementation of FI$Cal indicates that FI$Cal may need to extend the July 2018 deadline due to scheduling issues. In addition, deferred state agencies are intended to use FI$Cal when their own business management systems become obsolete. Exempt agencies have a statutory provision allowing them not to use FI$Cal.