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August 10, 2007

DiNapoli: Nyack Schools Issued $1.2 Million in
Contracts Without Complying with Bidding Laws

Nyack Union Free School District officials did not comply with competitive bidding laws when they awarded nearly $1.2 million in security and cleaning contracts for the 2005-06 fiscal year, according to an audit by State Comptroller Thomas P. DiNapoli. Additionally, the audit found that contrary to school board policy, district officials did not seek out lower fees for legal services before spending $165,545 for that work.

“There are rules for a reason,” DiNapoli said. “These are tax dollars, and taxpayers have the right to expect that tax dollars will be spent wisely. School districts should find the lowest responsible bidder for goods and services. If school districts pay too much for services that leaves too little to be spent in the classroom.”

The audit reviewed payments made to vendors during the 2005-06 fiscal year. It found that the district paid $522,309 for security services and $663,596 for cleaning services without going through the competitive bidding process.

The audit also found that – contrary to district policy – district officials did not use a request-for-proposals (RFP) process, or obtain written and verbal quotations, when they paid a total of $165,545 for legal services during the 2005-06 fiscal year.

DiNapoli noted that in 2006, the school board entertained 21 security service bids on three occasions but rejected all of them. The board’s reasons are not documented.

For the 2006-07 fiscal year, the board hired employees of the security company whose services the district had used since 2000. Although the district paid $169,119 less than the previous year under this new arrangement, the district still paid nearly $60,000 more than the lowest bid that was submitted to the district.

State law requires school districts to advertise for competitive bids on purchases over $10,000 and public work contracts greater than $20,000. Purchases below these thresholds do not have to be competitively bid. However, districts are legally required to follow board-adopted procurement policies and procedures. The Nyack Board requires that purchases be based on district officials’ review of RFPs.
Comptroller DiNapoli recommended that board members make sure district employees consistently implement the procurement policy; district officials prepare and maintain written documentation detailing the reasons why bids are rejected; and district officials use RFPs to obtain professional services.

District officials generally agreed with the audit’s findings. The district’s full response is included in the audit.

Click here to view the audit.

School District Accountability
State Comptroller Thomas P. DiNapoli requested and received an additional $2.7 million in 2007 to hire more staff to audit schools. In order to improve accountability of the state’s schools, the State Comptroller’s office will audit all of New York’s 832 school districts, Board of Cooperative Educational Services (BOCES) and charters schools by 2010. The State Comptroller’s office has completed more than 225 school audits with approximately 200 audits currently underway.


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