Purpose

To determine if the Office of General Services (OGS) is properly tracking and reporting New York State food purchases in compliance with the State Finance Law. This audit covers the period of January 1, 2014 through May 30, 2017.

Background

Section 165, subsection 4 of the State Finance Law (Law) was amended in 2013 to promote the sustainability of local farms by tracking how State agency food dollars are spent and identifying opportunities for additional purchases of local foods. The intent of the Law is to assist State agencies with the procurement of New York food products in part by providing information to decision makers on the extent of the State’s success in supporting local farm and agricultural businesses through the purchase of New York State food products, defined as products that are grown, harvested, produced, or processed in the State. Food is considered a New York State product if it has been grown, harvested, produced, or processed in the State.

To assist agencies in increasing their New York State food purchases, the Law requires OGS and Department of Agriculture and Markets (Ag&Mkts) to develop regulations, establish guidelines, and provide training on New York State food purchasing to agency personnel involved in the acquisition process. OGS is also responsible for tracking data on State agencies’ food purchases – both from inside and outside the State – and for providing a Food Metrics Annual Report to the Governor and the Legislature by December 1st of each year detailing these purchases. The report should include information on OGS’ efforts to improve and increase the tracking of information relating to New York State foods procured by agencies, as well as data on the types and sources of food products purchased by agencies during the year.

Key Findings

• OGS’ Food Metrics Annual Reports contained calculation errors and lacked complete information on statewide food purchasing. For example, the 2015 Annual Report omitted two months (October and November) of purchase data from a contractor, resulting in an understatement of 66,369 transactions valued at more than $5 million, including 3,689 transactions worth $245,000 involving New York sources. The report also improperly included purchases made by entities that are not operated by the State, which we estimate total about $11 million.
• OGS and Ag&Mkts had neither developed guidelines to direct and assist State agencies in procuring New York State food products, nor provided training to agency personnel, as required by the Law.
• In response to our audit, in May 2017, OGS and Ag&Mkts finalized and published the required guidelines for State agencies. These guidelines now direct agencies to submit more complete reporting of food purchases to OGS, which should aid in issuing more accurate Food Metrics Annual Reports in the future and ultimately increase the purchase of New York food products.

Key Recommendations

• Develop and provide training to agencies and vendors on reporting and purchasing of New York State foods.
• Develop and implement adequate controls to detect and correct anomalies and inaccuracies in data used to create the Food Metrics Annual Report.

Other Related Audit/Report of Interest

Office of General Services: Business Services Center Shared Services (2016-S-16)