Contracting procurement problems identified by the Auditors of Public Accounts (APA) in 2021 and 2022 have persisted, according to a forthcoming audit by the State Contracting Standards Board (SCSB) that was discussed during the board’s latest meeting.
In August of 2024, state auditors released a report showing DEEP had not provided written support for purchase orders, did not provide contracts for nearly $26 million in purchase orders, and did not have ethics affidavits for a six-figure contract. The auditors wrote that a lack of competitive quotes “decreased assurances the DEEP paid the lowest price,” and the department could not “verify it is adhering to the contractual terms” without the contracts on file.
In their response, DEEP blamed the pandemic but three years later the problems apparently persist, leading SCSB board members to debate how forcefully to reprimand the agency to ensure the point gets across. The SCSB recently completed audits of five state agencies, which have been published online, but DEEP’s audit is not yet available as the SCSB is awaiting DEEP’s comments on their findings.
Head of the audit subcommittee Alfred Bertoline said there was debate among subcommittee members over how forceful their language should be in addressing the fact that DEEP has failed to correct their procurement practices.
“The issue is the Auditor of Public Accounts went into DEEP two years ago, did an audit, and their audit covered a number of things, but part of it was procurement practices and found some noncompliance issues,” Bertoline said. “We come in two years later with our audit, selected a sample, and came up with the same issues. This is two years. If you get audited and you have problems, you should correct them, right? We come in two years later and they’re still doing the same thing.”
Unlike the APA, the SCSB has enforcement powers, including the ability to remove an agency’s authority to contract out for services, which board member Sal Luciano referred to as “the atomic option.”
“This is the crux of why we exist. We have an agency clearly not following procurement policies,” Luciano said. “This is exact situation with DEEP is the reason we exist, and we have the most important enforcement power that there is, which is [state statute] 4e-7. We have the hammer. We can stop them from having any purse strings at all. That’s the atomic option and that’s not one we prefer, but clearly, we need to make that clear to DEEP. We’re not screwing around.”
This is not the first time the SCSB has mulled using their authority to take away DEEP’s ability to issue contracts. The environmental and energy agency delayed complying the SCSB’s audit requests for ten months, repeatedly ignoring emails and requests for information by the board, which also contributed to the late completion of the SCSB’s audit.
The SCSB has also been rankled over the past year with ongoing disagreements between board members and staff, including Executive Director Greg Daniels. The board’s meetings were suspended for several months waiting for Gov. Ned Lamont to appoint a new board chairperson. Lamont named labor leader Rochelle N. Palache as board chair in May and filled another board vacancy with former Westport First Selectman James Marpe.
The board is also facing some budget challenges that were discussed during the meeting, particularly in light of the board’s Chief Procurement Officer Jonathan Longman being out on extended leave, which has left them short-staffed in the face of having to complete more state agency audits next year.
While the SCSB was slated to perform eleven audits this year, they will only have completed six when the DEEP audit is completed, which will require the board to roll over the remaining audits to next year, increasing their workload.
Thus far, the board staff has published audits of the Office of Higher Education, the Department of Public Health, the Department of Emergency Services and Public Protection, the Office of the Chief Medical Examiner, and Charter Oak State College. The audits mostly found missing ethics agreements or written evaluations of contractor performance.
The audit of DEEP involves five contracts totaling nearly $13 million, some of which were not competitively bid, according to a report by the Office of Policy and Management. Bertoline read from the yet-unpublished audit,that criticized the on-going procurement issues, saying, “this condition is unacceptable for the expenditure of state funds and must be addressed by DEEP management as a priority.”
“We can’t let this go,” Bertoline said to fellow board members. “The fact that they continue is unacceptable and we have to say that.”
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This is a really difficult story for the public to wrap their heads around because no one quite understands what it is the State Contracting Standards Board does or is supposed to be doing. The Board is an Advisory Council that is designed to oversee and guide the Staff, and it is comprised of members appointed or designated by both sides of the House and Senate as well as the Governor. To put it in perspective, 8 out of 14 Board Members have been Governor appointed, including the Board Chair who was appointed by Lamont in May of this year. Board Members are not state/government employees, but the staff are employees, there are 7 who are full-time with full-time salaries paid for by the taxpayers of Connecticut. Several of these staff salaries exceed six figures annually, although it is very difficult to determine what, if anything, these staff are doing. They attend a lot of trainings and they research things with results that always seem pending or forthcoming. The audits which the staff have been hired to conduct and execute in a timely manner are not being done and there is no plausible explanation as to why. The Auditor or Accounts Examiner reportedly holds an MBA. Each one of these audits should take that person a single work day to complete–that is how narrowly focused these SCSB audits are. If the Accounts Examiner took leave for a month, a 3rd grader could step in and complete 6 of these audits in that month. The SCBC Audits are a footnote in comparison the Audits conducted and completed on time (every time) by The Auditor of Public Accounts. In fact, the APA did the job of the SCSB in August of this year when the SCSB allowed DEEP to ignore all their data requests for 8 consecutive months. Lamont does not want DEEP audited. His appointees, in particular James Marpe, Daniel Rovero, Chairperson Palache, Executive Director Daniels and Staff Attorney Aaron Felman, seem to share in this same sentiment. It is also curious that Lamont appointed an 11 member Contracting Standards Advisory Council this May or June comprised almost entirely of all major CT Government Agency Heads yet he did not appoint a single representative from DEEP. That’s strange. But not nearly as strange as the Council’s one and only meeting. The Chief Procurement Officer is statutorily mandating to be both member and Chairperson of the Council comprised of Agency Heads that his taxpayer-funded job requires him to investigate, audit, and report on. Watch the YouTube of that meeting. Jonathan disappeared on leave shortly after that meeting but the taxpayers still cover his salary, almost 4 months later. It is my opinion that Executive Director Daniels is accountable to no one other than the Governor, which might also be said for Staff Attorney Felman. I do not see this staff as serving the taxpayers, and I do not see Lamont’s cherry-picked and placed appointee’s as being anything other than obstacles on the road to actual government accountability. The APA produces unbiased, professional audits that are highly sophisticated and data-driven. The SCBC cannot seem to separate the facts from their own emotional insecurities. And that’s why no one takes them seriously.