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An Audit Report on Contracting at the Texas Workforce Commission

October 2021

Summary Analysis

The Texas Workforce Commission (Commission) oversees and determines eligibility for the State's unemployment benefits program, which provides temporary income to workers who have lost their jobs through no fault of their own. As a result of the COVID-19 pandemic, the Commission experienced an unprecedented increase in claims for unemployment insurance benefits, and it contracted for expanded call center and identity verification services.

While the Commission was allowed to waive certain procurement and contracting requirements, it did not document its decision-making process for the requirements waived in contracting for the expanded call center and identity verification services. Being able to evaluate the decisions it made in executing and monitoring those contracts and developing documented processes could help the Commission respond to future events that create sudden and/or significant increases in unemployment claims.

 Jump to Overall Conclusion

To prevent a disruption in services due to increased unemployment insurance claims, the Commission contracted with certain providers to expand call center and identity verification services. Those contracts were executed pursuant to the Governor’s disaster declaration; therefore, they were not required to comply with all state statutes or administrative rules for contracting and procurement.

However, the Commission did not have a process to document its decision-making process or rationale for waiving certain statutes or rules. For example, the Commission did not include certain clauses designed to safeguard its data, such as the prohibition against accessing the network from outside the United States. In addition, the Commission did not enforce contract provisions requiring background checks for vendors' key personnel. While those actions were allowed by the disaster declaration, they did increase risk to the Commission’s data and operations. In addition, not documenting its reasons for waiving certain requirements limits the Commission’s ability to evaluate the effectiveness of those decisions.

Jump to Chapter 1 

The Commission's formation of the call center contracts complied with most applicable requirements. However, it should strengthen its disaster contract formation processes to include sufficient terms for monitoring and communication.

In waiving the procurement process for the four call center contracts procured in response to the COVID-19 pandemic, the Commission did not develop a solicitation. The Commission instead developed each contract separately, and the terms were inconsistent between those contracts. Specifically, the contracts did not include adequate terms related to monitoring and communication with the vendors.

Jump to Chapter 2-A 

The Commission performed some monitoring of the call center contracts and complied with vendor payment requirements. However, it should strengthen its disaster contract monitoring processes to include developing a comprehensive monitoring plan and ensuring adequate documentation of its monitoring activities.

The Commission waived the performance of a risk assessment under the disaster declaration and, as a result, it did not develop a comprehensive monitoring plan for the call center contracts. Without a set monitoring plan to guide it, the Commission did not ensure that its monitoring was consistent across the contracts, or that it consistently documented its monitoring activities.

Jump to Chapter 2-B 

The Commission formed the contract with, Inc. in accordance with most applicable requirements.

Jump to Chapter 3 

Graphics, Media, Supporting documents

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