An Audit Report on Selected Contracts at the Texas Facilities Commission
Report Number 15-001
The Texas Facilities Commission (Commission) should improve its monitoring of the two contracts audited to help ensure that the contractors perform according to the contract terms. Additionally, the Commission did not always plan the property management services contract or form the construction manager-at-risk (CMR) contract in accordance with the State of Texas Contract Management Guide, the State of Texas Procurement Manual, and Commission policies and procedures. The Commission generally procured both contracts in accordance with applicable statutes, rules, Office of the Comptroller of Public Accounts (Comptroller's Office) requirements, and Commission policies and procedures.
For the property management services contract with Tarantino Properties, Inc. executed in August 2011, the Commission did not sufficiently monitor the contractor's performance related to the maintenance and repair of the four buildings the contractor manages outside of Austin. The Commission did not receive or approve required reports for the four buildings managed under the contract. Neither the Commission nor the contractor could provide evidence showing that the contractor had (1) performed the required maintenance on mechanical, electrical, and plumbing systems for 14 of 24 months tested and (2) performed required maintenance on the elevator systems for 13 of 24 months tested.
For the CMR contract with SpawGlass Contractors, Inc. executed in December 2011, the Commission conducted monitoring activities and had documentation showing that the contractor was meeting the contract terms that auditors selected for testing based on their significance to the contract requirements. However, the Commission did not ensure that all payment applications contained required documents.
The Commission and both contractors could not provide documentation showing that criminal background checks were performed as required. The Commission does not maintain lists of the contractor or subcontractor employees and the dates they began working on site for the Commission to ensure that all employees receive the required background checks.
The Commission procured both contracts audited in accordance with the State of Texas Contract Management Guide, the State of Texas Procurement Manual, and Commission policies and procedures. However, the Commission did not plan the property management services contract or form the CMR contract in accordance with the State of Texas Contract Management Guide. Specifically, for the property management services contract, the Commission did not formally document a cost estimate, needs assessment, and risk assessment during the planning process. The CMR contract did not include all required essential clauses. In addition, six of eight Commission contract managers did not attend required contract management training courses.
Auditors communicated other, less significant issues related to contract documentation and management to the Commission in writing.