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NYS Comptroller

THOMAS P. DiNAPOLI

City University of New York (CUNY)
Communications Audio Visual (CAV)
(Issued: 3/21/2013)


Purpose

The objectives of our examination were to determine whether (i) the payments complied with the terms and conditions of the Award and Contract, (ii) Communications Audio Visual (CAV) paid its employees prevailing wage rates, and (iii) CAV provided Workers’ Compensation coverage to all its employees.

Background

CAV is an authorized reseller of audio visual equipment and accessories under multiple contracts awarded by the Office of General Services (OGS) under Award 21273-E.  The Award is limited to the sale of audio visual equipment and accessories and does not include installation.  Authorized users of the Award must procure installation separately. CAV also provides audio visual equipment and installation to Brooklyn College under Contract N901601.  According to the Contract’s terms and conditions, CAV is paid for audio visual equipment on a per item basis and for installation on a per hour basis.  There are no provisions in the Contract for Brooklyn College to procure audio visual equipment and installation at a combined price that includes both the equipment and installation.

Key Findings

  • The Colleges procured installation services from CAV using the Award; despite College officials’ acknowledging installation was not allowed.  The Colleges simply awarded the services totaling $58,567 ($56,367 for Hunter College and $2,200 for Brooklyn College) to CAV without competition and charged the services to the OGS contracts under the Award. 
  • Brooklyn College also procured audio visual equipment and installation services totaling $137,495 from CAV at a combined price that included equipment and installation on a per room basis.  According to the contract, there were no provisions for procuring equipment and installation on a per room basis.
  • The Colleges did not monitor the number of hours worked by CAV employees providing installation services, and CAV could not provide valid documentation to support its employees actually worked hours billed.  Consequently, the Colleges cannot demonstrate they paid a competitive price for the installation services under the Award, and Brooklyn College cannot demonstrate it was cheaper to procure audio visual equipment and installation services on a combined, per room basis.
  • CAV’s owner admitted he did not pay his employees prevailing wage rates.  He also admitted to owing his employees more than $82,000 ($49,907 for Brooklyn College and $32,200 for Hunter College) for the difference between the actual wages paid to the employees who worked at the Colleges in 2011 and the amount owed for prevailing wage rates and supplemental benefits.  We referred this finding to the New York State Department of Labor for further investigation. 
  • CAV submitted proof of Workers’ Compensation insurance to Brooklyn College as part of the bid process for the Contract.  Our review showed that this policy covered three employees.  However, payroll records CAV provided to us indicate CAV may have at least 14 full-time and/or part-time employees.  We referred this finding to the New York State Workers’ Compensation Board for further investigation. 

Key Recommendations

To Brooklyn and Hunter Colleges

  1. Establish a process to monitor and evaluate vendors’ compliance with contract terms and conditions.
  2. Ensure invoices only for work within the scope of existing contracts are charged against those contracts.
  3. Ensure all contractors and subcontractors with Public Works contracts submit certified payroll records, as required by law. 
  4. Periodically review certified payroll records to ensure contractors and subcontractors are paid only for hours worked and are paying prevailing wage rates.
  5. Ensure all contractors and subcontractors provide Workers’ Compensation insurance to all employees.

To Brooklyn College

  1. Ensure staff complies with Chapter XI, Section 2.H of OSC’s Guide to Financial Operations.

For a complete copy of Report 2011-0046, click here.


Division of Contracts and Expenditures
Bernard J. McHugh, Director of State Expenditures

Phone: (518) 474-4868 Email: stexpend@osc.state.ny.us
Address: Office of the State Comptroller, Division of Contracts and Expenditures
110 State Street, 10th Floor; Albany, NY 12236