For Immediate Release
October 28, 2009
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Senate Committee to Hold Public Hearings on Procurement Procedures

Harrisburg – Senator Mike Folmer (R-48), Chair of the Senate Communications and Technology Committee, today announced plans to hold public hearings on Auditor General Jack Wagner's recent report on state procurement procedures and conflicts of interest, specifically in the area of information technology contracts. Specific dates and locations for the hearings will be announced soon.

"Citizens elect us to be good stewards of their money, and when tax dollars are wasted, we let the people down," said Folmer. "When economic times are good, taxes don't decrease; when economic times are bad, there's a push to increase taxes. By carefully reviewing the Auditor General's findings, we can better ensure taxpayers come first, and they are getting the most for their money."

The Auditor General's report, released last week, found a lack of competition, transparency and accountability in the state's awarding of $592 million in contracts to a single information technology vendor. Wagner's auditors found there was no competitive bidding on 34 of 59 contracts awarded by the Administration to the information technology vendor. It also found the original value of the contracts swelled by 55 percent because of administration-approved change orders, sole-source contracts and emergency contracts awarded to the vendor.

In a letter to Governor Ed Rendell, Wagner wrote the audit "found that a lack of true transparency within the procurement process created the potential for improprieties in the awarding of Commonwealth contracts, including the potential for vendor favoritism."

Wagner also wrote, "we learned that audited agencies destroyed documents that would have been instrumental to our audit during the audit period, including two contracts destroyed at least six months after our audit started."

In news reports, the Governor has said the no-bid contracts were rewards for good vendor performance.

The public hearings will focus on Wagner's recommendations to improve the Department of General Services' policies, controls, and oversight of the procurement process, and the Rendell Administration’s response and planned follow-up to the audit.

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