State Auditor: More Procurement Contracting Issues that Can Kill Your Contract

In Audit Report 15-030, the State Auditor lays out a laundry list of what to do & what not to do when negotiating a state contract. Failing to complete all the flagged items below led to the cancellation of the $30M contract.

What to do, the good things:

• Have the solicitation reviewed by the State’s Contract Advisory Team
• Publicly post the solicitation
• Screen vendor proposals for completeness
• Evaluating the only vendor proposal that it determined was complete​

The auditor flagged these items:

• Make certain the agency, in this case HHSC, complies with its policies to complete a needs assessment and cost-benefit analysis to support outsourcing those operations
• Ensure there is documentation to support the contract amount
• Make certain the AG looks at big contracts, especially if it falls in nor near the thresholds of Government Code Section 531.018 
• If the solicitiation removed price as part of the best value analysis flags will fly. 
• If you’re bidding on a solicitiation and it references appendices and the agency doesn’t have appendices for the solicitation drafted. Heed this warning:
  • The State Auditor will notice abnd it will impact your contract
  • Your attorneys should be crying foul. Appendices and words matter in contracts.
• After 2015, agencies will do a better job of verifying information provided by vendors. None of the information provided byt he vendor was verified by the agency in this contract.
• If your contract requires the Executive Director’s approval, and after 2015 many more contracts will, make sure you get it.
• If your bidding, make sure your legal entity is qualified to do business in Texas. A quick informal check is by searching the Comptroller’s tax records. 

SAO 15-030  Statesman