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State developing rules on contract oversight

Post by Jordan Schrader / The News Tribune on Nov. 23, 2012 at 10:00 am with No Comments »
November 21, 2012 6:17 pm

I wrote last winter about a law the Legislature passed to consolidate state-government contracting, with many changes including more oversight of no-bid contracts. It gave the new Department of Enterprise Services authority to oversee contracts and discipline contractors.

Now the agency is filling in the details of that law. The public has a chance to weigh in on what DES is proposing. Go here to read the proposals and comment.

DES’s Roselyn Marcus said one of the biggest changes is how the agency delegates its contracting authority. In the past, agencies have been allowed to manage their own contracts up to a certain cost, at which point DES and its predecessors would step in. Soon the authority will depend not on price but on how risky DES believes the agency’s practices have been.

“We think our time would be better spent with agencies that actually have a high risk and need some help,” Marcus said.

DES is setting up a pilot program to do “risk assessments” of agencies, eventually expanding statewide. Symptoms of high risk might be lack of training or lack of a standardized process for contracts, or mismanagement of a particular contract. Agencies’ risk levels will be publicized and DES will try to improve them.

When agencies violated rules before, “there wasn’t really a lot of teeth,” Marcus said. The new process could make them more responsive, she said.

Unlike competitive contracts, sole-source or no-bid contracts will need Enterprise Services sign-off. But there are several exceptions being proposed, including for smaller purchases. For example, an agency would be able to go buy a hammer, or even a laptop computer, without going through a competitive bidding process.

The question DES must answer is where to draw that line between an ordinary purchase and a no-bid contract. The agency has proposed a rule setting the limit at $10,000. (See “topic 4.”)

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