Objective

To determine the extent of implementation, as of April 2022, of the six recommendations included in our initial audit report, Efficiency of Warehouse Space (Report 2019-S-1).

About the Program

The Spending and Government Efficiency (SAGE) Commission was formed to streamline State government operations by eliminating redundancies and implementing cost-savings measures. As part of these efforts, the Warehouse Consolidation Initiative (Initiative) was implemented to achieve cost savings through the consolidation of warehouse space used by State agencies. At the start of the Initiative, a survey was issued to all State agencies inquiring about warehouse and storage space and the associated costs because there was no central source for this information.

Our initial report, covering the period January 1, 2014 through March 29, 2019, was issued on January 3, 2020. The objective was to determine if the Office of General Services (OGS) had reviewed the warehouse space used by State agencies for cost-savings opportunities. The audit found that OGS had reduced leased warehouse space by 434,266 square feet and realized a cost savings of $1,699,020; however, OGS had not yet reduced any State-owned warehouse space. We could not determine the Initiative’s overall success, as an inventory of all State warehouses – leased and State owned – did not exist.

In response to the onset of the COVID-19 pandemic in March 2020, OGS shifted its priorities, requiring it to pivot and perform a variety of different services outside of its mission. These responsibilities included the purchase, receipt, and storage of millions of pieces of personal protective equipment (PPE) as well as entering into additional warehouse leases to receive and store this equipment.

Key Findings

Based on the shift in priorities during the pandemic, OGS has been limited in its efforts to consolidate warehouse space for cost-saving opportunities. Despite this, OGS was able to implement our six recommendations.