Report 2018-131 Recommendation 2 Responses

Report 2018-131: Alum Rock Union Elementary School District: The District and Its Board Must Improve Governance and Operations to Effectively Serve the Community (Release Date: May 2019)

Recommendation #2 To: Alum Rock Union Elementary School District

To preclude a situation where a contractor oversees its own work, the board should enact a policy by August 2019 to prohibit contracting with the same entity for construction management and program management services.

Annual Follow-Up Agency Response From November 2021

Board policy BP 3312 has been updated to reflect the following language, "The District shall not enter into a contract for construction management services or program management services where compensation is based on a percentage of construction costs or bonds issued. Contracts for construction management services or program management services shall stipulate compensation on a not-to-exceed basis. The District shall not use the same firm for program and construction management services." Below is the link to the board policy. https://simbli.eboardsolutions.com/Policy/ViewPolicy.aspx?S=36030683&revid=RrkDbyvhxam3l5KvL8XJfw==&ptid=amIgTZiB9plushNjl6WXhfiOQ==&secid=y1ZW0qRGjEafuplusqEjNeK2Q==&PG=6&IRP=0

California State Auditor's Assessment of Annual Follow-Up Status: Fully Implemented

We have assessed this recommendation as fully implemented based on the district's response and the evidence it provided.

Annual Follow-Up Agency Response From November 2020

The district did not formally respond to this recommendation to address our annual follow-up inquiry. However, it provided a document containing revisions to its policy.

California State Auditor's Assessment of Annual Follow-Up Status: Partially Implemented

The document that the district provided includes a provision prohibiting the district from contracting with the same entity for construction management and program management services. However, the board's current policy as presented on the district's website does not include this prohibition.

1-Year Agency Response

On February 13, 2020, the Board adopted BP 3312, which states in part, the District shall not enter into a contract for construction management services or program management services where compensation is based on a percentage of construction costs or bonds issued. Contracts for construction management services or program management services shall stipulate compensation on a not-to-exceed basis. The District shall not use the same firm for program and construction management services.

California State Auditor's Assessment of 1-Year Status: Partially Implemented

The board policy referenced does not specifically prohibit contracting with the same entity for construction management and program management services. The district did provide a recent request for proposals for program management services for construction projects that included a provision prohibiting the awarded firm from also being awarded a contract for construction management services. However, this provision does not fully address our recommendation.

6-Month Agency Response

Agency did not submit a six month response for this recommendation.

California State Auditor's Assessment of 6-Month Status: Pending

The district did not submit a six-month response to this recommendation. We continue to assess the status of this recommendation as pending.

60-Day Agency Response

1.Update Board Policies (3000 series (Business Operations) and 7000 series (Facilities), and Board Bylaws (9000 series);

2.Board Governance Training re: contracting requirements and processes; and

3.Staff training re: contracting requirements and processes.

Note: 9000 Series will be completed by end of September 2019.

California State Auditor's Assessment of 60-Day Status: Pending

All Recommendations in 2018-131

Agency responses received are posted verbatim.