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December 13, 2010

 

DiNapoli: School Districts Missed Out on $574,000 in Taxpayer Savings

Long Island, Hudson Valley & CNY Districts Could Have Awarded Lower Cost Contracts



Nine school districts missed out on $574,000 in potential taxpayer savings because they did not award professional service contracts to the lowest cost provider or failed to use a competitive process when awarding the contracts, according to an audit by State Comptroller Thomas P. DiNapoli.

“Competition for contracts saves taxpayers money.” DiNapoli said. “These are tough fiscal times.  School districts have to protect tax dollars and look for cost savings in every corner. Contracts with professional service providers should not be awarded without some form of competition.”

DiNapoli’s audit, covering July 2008 through August 2009, found nine school districts did not obtain special education professional services at the most economical cost, which caused the districts to miss out on $574,000 in potential cost savings. The districts are located in Nassau, Onondaga, Rockland and Westchester counties.

Auditors found $3.2 million, or 85 percent, of the money the districts paid to special education service providers went to providers who were not selected through a competitive process or who did not propose the lowest rates.  None of the districts documented the reasons for their selections.

While General Municipal Law does not require competitive bidding for some types of professional services, it does require districts to develop policies and procedures governing the procurement of professional services.  These procedures should include justification and documentation for awards that are made to providers who did not submit the lowest cost proposal.

The audit found:
  • while the three districts in Nassau County – Farmingdale, Jericho and Oyster Bay – used requests for proposals (RFP), they did not always award the contracts to the lowest bidders and did not document the reasons for their decisions;
  • White Plains City School District used RFPs for two out five contracts examined but did not always award the contract to the bidders with the lowest rates or explain why this was done;
  • the Ardsley, East Ramapo, Solvay, Skaneateles and West Genesee school districts did not use RFPs at all; and
  • rates paid for both occupational and physical therapy services in the Onondaga County districts alone ranged widely from $52 to $95 per hour.

DiNapoli’s audit recommends district officials:
  • request proposals when awarding all contracts for special education professional services;
  • develop policies and procedures that adequately address the procurement of special education professional services; and
  • ensure compliance with procurement policies, including requiring documentation of actions taken.

A summary of the districts’ responses are included in the audit.

To view the audit, visit here.



Potential Cost Savings in 2008-09 Professional Service Contracts by School District
School District
Potential Cost Savings
Farmingdale Union Free School District
$208,000
Jericho UFSD
$154,000
Oyster Bay-East Norwich Central School District
$26,000
Ardsley UFSD
$49,000
East Ramapo CSD
$13,000
While Plains City SD
$30,000
Skaneateles CSD
$60,000
Solvay UFSD
Less than $1,000
West Genesee CSD
$34,000
Total
$574,000





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