The information below is subject to change because it is updated periodically to incorporate the results from SAO reports with a significant focus on contracting activities as they are released. The reports included were released as of 1/15/2021.
Chapter 2-A - The Office Generally Planned, Procured, and Formed the YoungWilliams Contract in Compliance with Requirements; However, It Did Not Have All Supporting Documentation or Updated Policies and Procedures
The Office generally planned and procured the YoungWilliams Contract in accordance with applicable statutes, rules, and State of Texas Contract Management Guide requirements. The Office did not have all supporting documentation for the YoungWilliams contract related to planning and procurement requirements.
The Office’s current contracting policies and procedures allowed for deviations from those policies and procedures and did not always align with current practices.
Chapter 2-B - The Commission Procured and Formed Both Contracts Audited in Accordance with Most Applicable Requirements
The Commission complied with most applicable statutes and the State of Texas Contract Management Guide when it procured and formed the 9-1-1 Test Lab Services and Poison Control Network contracts.
- The Commission had proper justification for selecting the contractors and ensured that purchasing staff had the required certifications and completed conflict of interest forms.
- The Commission generally formed both contracts audited in accordance with applicable statutes and rules.
Chapter 2-A - The Agency Complied With Most Contract Procurement Requirements
The Agency had sufficient controls in place to help ensure compliance with most procurement requirements. Specifically, the Agency advertised the solicitations tested in accordance with Texas Government Code, Chapter 2155; it ensured that each proposal included all of the information as required by the solicitation before it accepted the proposal; and it implemented consistent evaluation procedures. The Agency also complied with the statutory requirements for vendor selection for three of four procurements tested. The Agency purchaser responsible for overseeing the procurements tested was a Certified Texas Procurement Manager as required by statute.
Chapter 2-B - The Agency Did Not Consistently Report Contract Information to the Electronic State Business Daily as Required
The Agency did not fully comply with all statutory requirements to report information to the Electronic State Business Daily for Cobb-Excavation A/E, Balfour-CMA, and contract amendment No. 5 for Cobb-Site Services. Not posting the award of services or reporting incomplete information about an award to the Electronic State Business Daily system reduces the transparency of the procurement process.
Chapter 2-C - The Agency Did Not Fully Comply With Conflict of Interest and Nondisclosure Requirements
The Agency did not ensure that Commission members, evaluation team members, and vendors consistently complied with applicable conflict of interest and nondisclosure requirements. It should strengthen its processes to ensure that (1) Commission members disclose potential conflicts of interests as required, (2) all evaluators sign the required forms in a timely manner, and (3) vendors complete all required Certificates of Interested Parties.
Chapter 1-A - The Commission Did Not Consistently Require Those Involved in the Evaluation and Procurement of the Contracts Audited to Sign Conflict of Interest Forms
The Commission ensured that all purchasing staff signed annual conflict of interest forms. However, for the two audited contracts, the Commission did not require any evaluation team members or members of its governing board to sign conflict of interest forms, as required by Texas Government Code, Sections 2262.004 and 2261.252. In addition, the Commission did not have a process in place to identify who should complete a conflict of interest form during the procurement process or throughout the term of the resulting contracts.
Chapter 1-C - The Commission Complied with Some Procurement Requirements for Both Contracts; However, It Should Strengthen Its Process to Ensure It Complies with All Applicable Requirements
The Commission complied with some contract procurement requirements for both audited contracts, such as posting both solicitations to the Electronic State Business Daily and using the evaluation criteria that was included in the solicitations. For both contracts audited, the Commission had weaknesses in its procurement processes related to opening solicitation bids, providing guidance to evaluation team members, and ensure that its board members obtain required contract training.
Chapter 2 - While the Commission Planned and Formed the Selected Contracts in Accordance With Most Applicable Requirements, It Should Strengthen Its Processes
For both contracts audited, the Commission complied with most contract planning and formation requirements. However, the Commission should (1) strengthen the development of its contracts to ensure that it includes all significant specifications in the executed contract and (2) require contractors to submit a Certificate of Interested Parties to the Texas Ethics Commission prior to signing a contract.
Chapter 1 - The Department Planned, Procured, and Formed the Atos Contract in Accordance with Applicable Requirements, But It Should Improve Certain Aspects of Contract Oversight
The Department of Information Resources (Department) planned, procured, and formed the data center services contract with Atos Governmental IT Outsourcing Services LLC (Atos) in accordance with applicable requirements. However, the Department should improve certain aspects of its contract oversight. The Department had not updated its contract management plan or its risk assessment for the Atos contract since the contract was assigned to Atos in May 2015.
In addition, the Department’s contract monitoring system, Salesforce, did not have adequate controls for the approval and authorization for the payment of invoices for the Atos contract.
The Department also did not adequately control access to a network location where it maintained key invoice review spreadsheets.
Chapter 2-A - The Department Planned and Formed the C&T Contract in Accordance with Applicable Requirements, But It Should Improve Certain Aspects of Contract Procurement
The Department planned the procurement through which it awarded the C&T contract in accordance with the requirements in the State of Texas Contract Management Guide.
The Department adequately performed certain contract formation activities for the C&T contract.
The Department adequately performed certain procurement activities for the C&T contract, such as conducting contract negotiations. However, the Department should improve certain aspects of its procurement process.
The Department should improve controls related to its receipt of proposals. The Department properly documented its receipt of C&T’s proposal in accordance with Department procedures and as the State of Texas Procurement Manual requires. However, it scored two other vendors’ proposals without maintaining evidence that it had received them by or on the due date.
The Department should score proposals using the methodology specified in its solicitation.
Of the 17 Department employees who were involved in planning the procurement, preparing the solicitation, performing preliminary reviews of proposals, and evaluating proposals, 7 (41 percent) did not sign required nondisclosure statements and 9 (53 percent) did not sign required disclosure statements as required.
Chapter 1-A - The Commission Did Not Screen All Vendor Proposals Accurately or Adequately Perform Required Vendor Compliance Verifications, and Did Not Properly Plan to Re-Procure One of Its Contracts
The Commission did not consistently follow its processes and guidance for certain planning, procurement, and vendor selection functions. Specifically, the Commission did not screen all vendor proposals accurately or adequately perform required vendor compliance verifications. The Commission also made an emergency procurement that it could have avoided if it had properly planned to re-procure one of its contracts.
Chapter 1-B - The Commission Did Not Consistently Obtain Required Certifications and Disclosures
Similar to the findings in a November 2018 audit of selected Commission contracts, the Commission did not consistently obtain statutorily required certifications and disclosures from its employees for the contracts audited. The Commission did, however, improve its compliance with the requirement to obtain disclosures from vendors for applicable contracts tested.
Chapter 2 - The Commission Had Processes and Controls in Place to Ensure That Vendor Proposals Were Evaluated Accurately
Since a July 2018 audit report on the Commission’s scoring and evaluation of selected procurements, the Commission made significant improvements to its processes for evaluating vendor proposals and the Commission’s final scores and rankings supported its award decisions.
Chapter 1-A - The Commission Did Not Comply with Requirements for Emergency Purchases
The Commission's procurement process did not comply with certain requirements that help to ensure the reasonableness and necessity for the three emergency purchases tested. The Commission (1) did not ensure that one of the procurements qualified as an emergency purchase because it was not the result of unforeseeable circumstances, and (2) it did not document the reasons for selecting a vendor for the other two emergency purchases.
Chapter 1-B - The Commission Did Not Ensure That Its Single Response Awards Complied with All Applicable Procurement Requirements
The Commission did not comply with certain requirements for single response awards. For the three procurements tested that received only one response, the Commission did not consistently (1) document that the single response award met solicitation requirements or (2) ensure that it notified vendors on the Centralized Master Bidders List of the opportunity to submit proposals. In addition, in some cases, the Commission accepted vendor proposals after the established due date.
Chapter 2-A - The Commission’s Award Decisions for the Competitive Procurements Tested Were Reasonable
For the three competitive procurements tested, the Commission based its award decisions on the recommendations made by its staff. In making those recommendations, staff from the Commission's purchasing, procurement, and legal departments developed and submitted to the executive commissioner a memorandum for each procurement that described the evaluation process followed including a summary of the scoring and evaluation results. Auditors determined that the memorandums provided a reasonable justification for the recommendation made to the executive commissioner.
While the Commission's award decisions were reasonable based on the recommendations that it received, auditors identified in a prior audit significant weaknesses with the Commission's evaluation scoring process for 2 (67 percent) of the 3 competitive procurements tested. Those two procurements were for (1) business process redesign services and (2) the Provider Management and Enrollment System. For additional information about the evaluation scoring process for those two procurements, see An Audit Report on Scoring and Evaluation of Selected Procurements at the Health and Human Services Commission (State Auditor's Office Report No. 18-038, July 2018).
Chapter 3-B - The Commission Did Not Consistently Comply with All Reporting Requirements for Contracts
The Commission did not consistently comply with certain reporting requirements for the applicable contracts tested. Specifically, the Commission:
-Did not consistently report its contracts and amendments to the Legislative Budget Board as required.
-Did not consistently obtain required disclosures of interested parties from awarded vendors prior to executing contracts.
Chapter 3-C - The Commission Did Not Ensure That Its Employees Complied with Disclosure Requirements for Its Procurements, and It Did Not Consistently Develop Reasonable Cost Estimates
The Commission had weaknesses in its processes for (1) ensuring compliance with statutory disclosure requirements related to potential conflicts of interest and (2) developing reasonable cost estimates for one of the competitive procurements tested.
Chapter 2 - LAC Attachment
Auditors identified errors in the Health and Human Services Commission’s (Commission) calculations of evaluation scores and weaknesses in its management of the evaluation processes used to review and score vendor proposals for 28 major contract and grant procurements.
Auditors tested 28 procurements the Commission awarded and considered for award from January 1, 2015, through March 31, 2018, that totaled $4.6 billion. Table 1 summarizes the errors, weaknesses, and recommendations related to the Commission’s scoring and evaluation of the 28 selected procurements.
Chapter 1-A - The Department Based Its Award Decision on Inaccurate Evaluation Scores and Unverified Information Described in Vendor Proposals
The Commission’s award recommendation was based on an erroneous compilation and calculation of evaluation scores. The evaluation tool that the Commission used to combine and calculate the evaluation teams’ final evaluation scores of each vendor’s proposal were based on inconsistent mathematical formulas, inaccurate information, and it transposed and omitted certain scores as the result of data entry errors. The Commission used those final evaluation scores to support its award recommendation to the Department.
The Commission did not verify the qualifications and experience of the five bidding vendors. The Commission did not use additional methods described in the solicitation that would have allowed the evaluation teams to better evaluate and score a vendor’s qualifications, including the software products offered. Texas Government Code, Section 2157.125, requires an agency to consider prices, past vendor performance, vendor experience or demonstrated capability, and the evaluation factors for award decisions involving automated information systems. While the solicitation specified that the Commission and the Department would be conducting reference checks upon receipt of vendors’ proposals that could result in a vendor’s disqualification if the references did not confirm that a vendor met the minimum qualifications or were inconsistent with a vendor’s representations, the Commission decided not to conduct reference checks.
Chapter 2-A - The Department Executed the Original Contract Without Obtaining a Required Exemption, Which Resulted in a Contract Amendment That Increased Costs and Caused Project Delays
The Department’s contract with Genesis Systems Inc., executed June 1, 2016, required the vendor to host TxEVER outside the Statewide Data Center Services Program. However, the Department did not obtain the required exemption from the Governor and the Department of Information Resources that would allow TxEVER to be hosted outside the Statewide Data Center Services Program.
On September 1, 2016, the Department of Information Resources sent a written notification to the Department that the contract was non-compliant with state requirements concerning the Statewide Data Center Services Program. On June 22, 2017, the Department executed Amendment No. 1 to its contract with Genesis Systems Inc. Amendment No. 1 changed the contract’s scope of work to require TxEVER to be hosted by the Statewide Data Center Services Program, which led to additional costs and delays for the TxEVER project.
Chapter 3 - The Commission Generally Procured and Formed the Contract with Morris & Dickson Company in Accordance with Requirements; However, It Should Strengthen Its Proposal Evaluation Process
The Commission generally procured and formed the Morris & Dickson Company contract in accordance with applicable statutes, rules, Comptroller’s Office requirements (requirements), and Commission policies and procedures. However, the Commission should ensure that vendor proposals include all required documentation, appropriate personnel complete required disclosure and non-disclosure forms, and proposal evaluations are accurate and complete.
Chapter 1-A - The Department Based Its Award Decision on Inaccurate Evaluation Scores and Unverified Information Described in Vendor Proposals
The Commission’s award recommendation was based on an erroneous compilation and calculation of evaluation scores. The evaluation tool that the Commission used to combine and calculate the evaluation teams’ final evaluation scores of each vendor’s proposal were based on inconsistent mathematical formulas, inaccurate information, and it transposed and omitted certain scores as the result of data entry errors. The Commission used those final evaluation scores to support its award recommendation to the Department.
The Commission did not verify the qualifications and experience of the five bidding vendors. The Commission did not use additional methods described in the solicitation that would have allowed the evaluation teams to better evaluate and score a vendor’s qualifications, including the software products offered. Texas Government Code, Section 2157.125, requires an agency to consider prices, past vendor performance, vendor experience or demonstrated capability, and the evaluation factors for award decisions involving automated information systems. While the solicitation specified that the Commission and the Department would be conducting reference checks upon receipt of vendors’ proposals that could result in a vendor’s disqualification if the references did not confirm that a vendor met the minimum qualifications or were inconsistent with a vendor’s representations, the Commission decided not to conduct reference checks.
Chapter 1-B - The Commission and Department Complied with Requirements for Developing a Solicitation, Including Having the Proper Segregation of Duties and Ensuring That Management and Staff Disclosed Conflicts of Interest as Required
The Commission and Department complied with requirements for developing a solicitation for the procurement of a major information resources project, including ensuring that the appropriate management and staff were involved in the procurement and that those individuals met requirements for protecting the objectivity of the procurement process.
Chapter 1 - DSHS’s Use of DIR’s Information Technology Staffing Services Contracts Generally Complied with State Laws, Rules, Policies, and Procedures; However, DSHS Should Improve Certain Aspects of Its Contract Management Processes Related to Those Contracts
The Department of State Health Services’ (DSHS) Use of Department of Information Resources’ (DIR) information technology staffing services contracts generally complied with state laws, rules, policies, and procedures. Auditors tested five DSHS purchase orders for information technology staffing services that totaled $2,695,670. The results of that testing identified opportunities to improve certain aspects of its contract management processes related to these contracts.
Chapter 3-A - The Coordinating Board’s Contract for a New Loan Management System Complied with Most Requirements
The Coordinating Board administered the audited contract in accordance with applicable statutes and the State of Texas Contract Management Guide. Specifically, the Coordinating Board (1) performed contract planning activities necessary for determining the contract objectives; (2) identified the appropriate procurement method; (3) formed the contract with all key contract provisions required by the State of Texas Contract Management Guide; and (4) monitored key contract deliverables.
Chapter 3-B - The Coordinating Board Should Verify That Required Disclosure Forms Are Consistently Completed
The Coordinating Board did not ensure that all members of the bid evaluation team and contract management personnel involved in the audited contract completed the required disclosure forms.
Chapter 1-A - The Agency’s Management Override of Controls Affected the Tembo Contract Award Outcome
On multiple occasions, Agency management overrode contracting controls in order to award the contract to its preferred vendor when it:
•Inappropriately requalified Tembo’s proposal,
•Incorrectly advanced Tembo’s proposal to the final round over a higher scoring proposal, and
•Awarded Tembo the contract over another vendor with the same final score without an explanation for that decision.
Chapter 1-B - While the Agency Followed Its Contract Formation Processes, It Should Strengthen Those Processes to Ensure That It Complies With All Requirements
The Agency generally followed its contract formation process for the contract that it awarded to Tembo. It also ensured that its contract effective date coincided with the execution of the contract. However, the Agency should ensure that it complies with applicable statutes and other requirements.
Chapter 2 - The Agency Did Not Have an Adequate Control Environment to Protect the Integrity of the SPEDx Procurement
Significant weaknesses in the Agency’s control environment resulted in the Agency awarding the contract to SPEDx without following steps designed to safeguard the procurement process. When taken together, the following factors adversely affected the integrity of the procurement: (1) the Agency’s failure to complete critical planning and procurement steps, including the selection of SPEDx prior to fully identifying the Agency’s needs; (2) the use of a non-competitive sole source procurement to award the contract to SPEDx without completing sole source processes; and (3) the Agency’s primary decision maker’s preexisting professional relationship with a SPEDx subcontractor.
Chapter 2 - The Agency Generally Complied with Statutes and Requirements for Contract Planning; However, It Should Strengthen Controls Over Certain Contract and Grant Procurement and Oversight Processes
The Agency planned the audited contracts in accordance with applicable statutes, rules, Office of the Comptroller of Public Accounts (Comptroller’s Office) requirements, and Agency policies and procedures. The Agency ensured that the associated statements of work contained all of the elements that the Comptroller’s Office required and that the bids were completed correctly. The Agency also completed a formal preliminary risk assessment for both contracts audited to determine the level, type, and amount of management, oversight, and resources required to plan and implement the contracts.
However, the Agency should improve certain contract and grant administration procedures related to procurement and oversight. Specifically, the Agency should improve its contract procurement process by ensuring that its purchasing staff are free of conflicts of interest and by reviewing solicitations when the Agency receives only one bid to determine whether the solicitations were overly restrictive. The Agency also should strengthen its contract and grant oversight processes by making sure it reviews documentation related to contract and grant deliverables.
Chapter 2 - The Agency Generally Complied with Statutes and Requirements for Contract Planning and Procurement; However, It Should Strengthen Controls Over Certain Planning, Procurement, and Formation Processes
The Agency established and generally followed entitywide contracting policies and procedures that were consistent with the State of Texas Contract Management Guide to award the fiscal year 2016 TxVSN contract. However, the Agency did not post certain contracting procedures to its Web site or provide a link to those procedures for inclusion on the Comptroller’s Web site, as required. While Agency contract managers met training and certification requirements and applicable personnel completed nondisclosure and conflict of interest statements, the Agency did not ensure that all purchasing personnel completed required disclosure statements prior to awarding the fiscal year 2016 TxVSN contract. The Agency also did not fully define the contract deliverables in its solicitation, which would have helped facilitate the Agency’s monitoring of those deliverables.
Chapter 2 - The University Complied with Most Requirements for Contract Planning and Procurement for the Two Contracts Audited
The University planned and procured the two contracts audited in accordance with most applicable statutes and University policies and procedures. However, it should ensure that it includes all applicable required terms in its solicitations. In addition, it should implement a procedure to assess the risk of fraud, abuse, or waste in the contractor selection process, contract provisions, and payment and reimbursement rates and methods.
Chapter 1-B - The System Did Not Consistently Ensure That Vendor Proposals Were Accurately Scored and That Required Conflict of Interest Forms Were Completed
The System did not have a process in place to ensure that vendor proposals were accurately scored and ranked. For example, evaluators did not consistently use the same scoring weight, and all evaluator scores were not always included in the final ranking. Additionally, the System did not always ensure that every employee involved in the contracting procurement process completed conflict of interest, non-disclosure agreement, and nepotism disclosure forms.
Chapter 1 - While the System Planned, Procured, and Formed the HSC Contract in Accordance with Most Applicable Requirements, It Should Strengthen Its Evaluation Scoring Process
The System complied with most applicable requirements to plan, procure, and form the HSC contract. However, the System should strengthen its process for evaluation scoring.
Chapter 1 - The System Planned, Procured, and Formed the Audited Contract in Accordance with Applicable Requirements
The University of North Texas System (System) complied with applicable statutes and its Contracting Handbook (May 2012) to plan, procure, and form the contract for the construction of its Interdisciplinary Research Building at the University of North Texas Health Science Center at Fort Worth.
Chapter 1 - The Department Complied with State Requirements for Contract Planning, Procurement, and Formation for the Contracts Audited
The Department of Criminal Justice (Department) complied with applicable statutes and the State of Texas Contract Management Guide for contract planning, procurement, and formation for (1) its four contracts with Corrections Corporation of America for the operation and management of the four state jail facilities (state jail contracts), awarded in January 2011, and (2) its contract with Sunrise IT Solutions Group for the installation of fiber optic network cabling at multiple Department units and facilities (UNIR contract), awarded in October 2016.
Chapter 1-A - The Department Did Not Use the Appropriate Procurement Method for the Texas Conference of Urban Counties Contract Due to Weaknesses in the Planning Process.
As a result of not properly planning the procurement for JCMS services, the Department did not use the appropriate procurement method for its contract with Urban Counties. Specifically:
The Department inappropriately procured those services in January 2017 as a proprietary purchase with Urban Counties. A proprietary purchase is for products or services that have distinctive characteristics for which only one vendor can provide.
The Department did not properly plan a subsequent competitive request for offer (RFO), which it canceled after scoring the five responses received, asserting that the scoring did not accurately reflect the technical requirements.
It then extended the proprietary contract with Urban Counties, which had submitted a proposal to that competitive RFO and did not receive the highest score. As of May 2019, the proprietary contract was still in effect, and a new contract based on a competitive solicitation has not been executed.
Chapter 2-A - The Department Planned, Procured, and Formed the FAST Contract in Accordance with Most Applicable Statutes and Rules
The Department complied with most applicable statutes and rules for planning, procuring, and forming its Fingerprint Applicant Services of Texas (FAST) contract.
However, auditors identified certain weaknesses in the Department’s contracting processes. Specifically, the Department did not verify that the contractor to which it awarded the contract had submitted audited financial statements with its proposal, as required by the solicitation.
In addition, the Department received only one proposal, and it did not document (1) that it had re-reviewed the solicitation for unduly restrictive requirements or (2) the feedback it had received from vendors about its proposed solicitation, as required by State of Texas Contract Management Guide.
Chapter 2 - While the Commission Appropriately Planned and Formed Both Contracts Audited, It Should Improve Its Processes Related to Conflicts of Interest and Non-Disclosure Forms
The Commission generally planned and formed the waste removal contract and the Superfund-related contracts in accordance with applicable statutes, rules, and its policies and procedures. However, the Commission should improve its process related to conflicts of interest and non-disclosure and develop procedures for assessing fraud, waste, or abuse and for reporting liquidated damages assessed or collected, when applicable.
Chapter 3-B - The Department Should Ensure That It Reviews Information from VPTS Prior to Selecting Vendors as Required
The Department could not provide documentation showing that it reviewed VPTS information prior to selecting vendors for any contracts and purchase orders that started between September 1, 2017, through December 31, 2018. Both the Texas Government Code and Department policy require vendor performance information in VPTS to be considered when determining whether to award a contract; and the Department asserted that it consistently complied with that policy.
Chapter 2 - The Division Procured and Formed the Contracts Tested in Accordance with Most of Its Processes, But It Should Consistently Document Its Evaluations, Require Staff to Complete Nondisclosure Agreements and Conflict of Interest Forms, and Include All Essential Clauses in Contracts
The Division had processes and related controls to help ensure that it procured 24 design contracts and 12 construction contracts associated with 23 capital construction projects tested in accordance with applicable requirements. However, the Division should ensure that it consistently (1) maintains its vendor evaluations, (2) requires staff to complete nondisclosure agreements and conflict of interest forms, (3) documents its contractor selection, and (4) includes all essential clauses in contracts.
Chapter 1 - The Commission Generally Planned, Procured, and Formed the Pollard and IGT Contracts According to Applicable Statutes, Rules, Office of the Comptroller of Public Accounts Requirements, and Commission Policies and Procedures
While Texas Government Code, Section 466.105, exempts the Texas Lottery Commission (Commission) from many statutory contracting requirements, the Commission has voluntarily adopted rules and policies to follow certain statewide requirements for contract planning and procurement.
For the Pollard Banknote Limited (Pollard) contract audited and IGT Solutions Corporation (IGT) contract audited, the Commission generally complied with applicable statutes, rules, Office of the Comptroller of Public Accounts requirements, State of Texas Contract Management Guide requirements, and Commission policies and procedures to ensure that it performed the activities discussed below. However, the Commission (1) did not require contracting personnel and evaluation team members to sign conflict of interest forms and (2) did not require contracting personnel to sign non-disclosure forms for the contracts audited, as required by Texas Government Code, Sections 2261.252 and 2262.004 (the Commission is not exempt from those requirements). The Commission has developed procedures that require contracting personnel to complete those forms for future contracts.
Chapter 2-A - The Department Adequately Performed Contract Planning, Procurement, Formation, and Oversight Activities for the Insight Contract
The Department complied with most applicable requirements to plan, procure, form, and monitor the Insight Public Sector (Insight) contract. However, it should ensure that all provisions in the contract are consistent with the solicitation documents and the vendor submits all Historically Underutilized Business (HUB) subcontracting plans and reports as required.
Chapter 1-A - The Department’s Facilities Section’s Processes Do Not Ensure That Its Contracts Are Administered in a Consistent Manner
The Department’s Facilities Section does not have a comprehensive set of approved policies and procedures for its administration of facilities-related contracts, including planning, procurement, formation, and oversight. Having detailed policies and procedures for all aspects of the Facilities Section’s planning, procurement, formation, and oversight processes would help ensure that facilities-related contracts are administered in a consistent and effective manner.
Chapter 3-A - The Department’s Facilities Section Planned, Procured, and Formed the Audited Contract in Accordance with Applicable Requirements
The Department’s Facilities Section planned, procured, and formed the audited contract in accordance with applicable requirements.
Chapter 3-B - The Department Should Strengthen Its Controls Over Required Disclosures
The Department did not ensure that the seven employees involved in the procurement of the audited contract with Vincent Roofing Inc. completed a Nepotism Disclosure Form, as required by Texas Government Code, Section 2262.004. The Nepotism Disclosure Form is required to be completed even in the absence of potential or actual nepotism. While auditors did not identify any instance of nepotism, ensuring that the required disclosure forms are completed by all applicable parties could help the Department ensure that the procurement process is fair and objective. In addition, the individuals involved in the procurement and management of the audited contract did not complete a conflict of interest statement. This included the seven Facilities Section employees who procured (recommended for award) the contract and the three Facilities Section employees who managed the contract. The Department asserted that Title 34, Texas Administrative Code, Section 20.158, requires conflict of interest disclosures be documented only when a potential or actual conflict exists. Therefore, the Department did not require its employees involved in the procurement or management of a contract to document their asserted absence of a conflict of interest.
Chapter 1-A - The Department Procured the Contracts for the Design-build Projects Audited in Accordance with Most Applicable Requirements
The Department procured the contracts for the design-build projects audited in accordance with most applicable requirements (one of the projects audited was still in the procurement stage).
Chapter 1-B - The Department Lacks a Fully Established Framework for the Design-build Procurement Process to Ensure Consistency and Accuracy Across All Design-build Projects
The Department lacks policies and procedures to ensure that contracts for design-build projects are procured in a consistent manner.
Auditors identified inconsistencies and weaknesses in the Department’s procurement for the four projects audited.
• The Department did not document its determination to use the design-build method for the Energy Sector Road Repair project; the IH35-E (Managed Lanes) project; the US 181 Harbor Bridge Replacement project; or the SH 99 (Grand Parkway) Segments H, I-1, and I-2 project.
• The Department did not ensure that the addenda to the requests for qualifications and requests for proposals were approved by the Department’s authorized representatives identified for each project.
• The Department did not ensure that all personnel who evaluated the qualifications statements and proposals completed an individual scoring worksheet, as required.
• The Department did not have evidence that it considered a contractor’s past performance during the evaluation process.
• The Department did not consistently retain all required contract procurement records.
Chapter 1-D - The Department Should Consider Certain Opportunities for Improving the Effectiveness and Efficiency of Its Use of the Design-build Method
Auditors identified areas in which the Department could improve the effectiveness and efficiency of its procurement process for design-build projects. The Department should consider the following opportunities to improve the effectiveness and efficiency of its use of the design-build method.
• The Department should consider establishing an approved template that specifies the form, substance, and standard provisions for design-build contracts.
• The Department should consider documenting a policy or procedure to ensure that descriptive information related to the alternative technical concepts is redacted before the price proposals are evaluated.
• The Department should consider reviewing the membership of its evaluation committees and subcommittees to ensure adequate segregation in the membership.
• The Department should consider documenting policies and procedures to establish a process for performing a postmortem review during the close-out of a design-build project.
Chapter 2-B - The Commission Should Ensure That It Reviews Information from VPTS Prior to Selecting Vendors as Required
For 21 (78 percent) of 27 contracts and purchase orders tested that started between September 1, 2017, through December 31, 2018, the Commission did not have documentation showing that it reviewed VPTS information prior to vendor selection as required.
Chapter 2 - TWC’s Use of DIR’s Information Technology Staffing Services Contracts Generally Complied with State Laws, Rules, Policies, and Procedures; However, TWC Should Improve Certain Aspects of Its Contract Management Processes Related to Those Contracts
The Texas Workforce Commission’s (TWC) use of DIR information technology staffing services contracts generally complied with state laws, rules, policies, and procedures. Auditors tested five TWC purchase orders for information technology staffing services that totaled $768,310. The results of that testing identified opportunities to improve certain aspects of its contract management processes related to those contracts.