Purpose

To determine the extent of implementation of the five recommendations included in our initial audit report, Administration of Non-Competitive and Limited-Competition Contracts (Report 2013-N-2).

Background

Our initial audit, which was issued on June 17, 2015 determined whether the New York City Administration for Children’s Services (ACS) properly awarded, extended, and renewed non-competitive and limited-competition contracts with vendors. We also determined if ACS sufficiently monitored contractor performance before either renewing or extending there contracts. The audit covered the three fiscal years ended June 30, 2013. We found that ACS officials did not provide sufficient oversight of contractor performance. Officials renewed or extended contracts with some vendors that had poor performance. In fact, 12 sampled contract vendors received less-than-satisfactory performance ratings. The vendors’ contracts totaled $114.1 million. For 9 of the 12 vendors, children in their care were abused by employees or foster parents. Consequently, in some cases, the health and safety of children were placed at risk. We also found that ACS officials did not always comply with the Procurement Rules and document their justification for awarding certain non-competitive and limited-competition contracts. For 13 contracts (totaling about $20 million), there was inadequate documentation to justify the non-competitive methods used to award the contracts.

Key Finding

ACS has not made progress in addressing the issues identified in our initial report. Of the five prior recommendations, none were implemented.  

Key Recommendation

Officials are given 30 days after the issuance of the follow-up report to provide information on any actions that are planned to address the unresolved issues discussed in this report.

Other Related Audit/Report of Interest

New York City Administration for Children's Services: Administration of Non-Competitive and Limited-Competition Contracts (2013-N-2)