Chief Deputy State Controller Dan Goicoechea told lawmakers on an interim committee examining state purchasing procedures that the state’s recent major contracting problems came not because of flaws in the state law, but because of failures in management oversight. “Contracts are much like employees,” Goicoechea said. “You avoid having employment problems by not hiring them. You avoid contract problems by doing your spade work up front. The Department of Purchasing does a very good job for the agencies (for which) they do that.”
Without naming the state Department of Administration, which issued the $60 million Idaho Education Network contract that a court ruled was issued illegally, Goicoechea referred to a “department that recently changed leadership.” “It was determined that the entity did not follow the law, not that the law was broken,” he said. “You have to look at management oversight. There needs to be accountability in the person,” who functions as the “center fielder” in issuing a major contract.
Goicoechea said while constitutional elected officials like the controller aren’t required to go through the state Purchasing Division for contracts, they are all subject to state purchasing laws. “We are not exempt from the law,” he said flatly. He said the controller works with the Purchasing Division to take advantage of its expertise, “while still maintaining the autonomy of the elected official.”
He suggested lawmakers reconsider the way state agencies are charged for using the services of the Department of Administration. “Controller Woolf would like you to entertain” that idea, he said. “A few years ago, the funding model for the Department of Administration was changed. Purchasing … assesses a fee … on all contracts. … Please analyze, is that an incentive or a disincentive to use purchasing?”
Now, state Purchasing Division Administrator Bill Burns is addressing the panel, which is meeting much of the day at the Capitol today; you can watch live here. At 2:45 p.m., the committee is scheduled to take public testimony. It’s meeting in Room EW42 on the lower level of the state Capitol.
Burns told the panel, a joint committee that includes five senators and five representatives, “In Idaho in 2002, Idaho … took much of the model procurement code and engaged that into our rules.” In examining the laws and rules now, he said, “My opinion, in looking at the code and looking at Idaho law, our laws generally follow the model procurement code of 2000. I saw no major deviations, and I saw no sections that create gaps in the Idaho code.” One exception, he noted, is that Idaho lacks an ethics commission, which the model code recommends.
“As we look at our state purchasing laws, the thing we have discovered is that they work pretty darn well,” Burns said. However, the code is complicated and is mingled with other statutes; he said it’d be an improvement to have a single chapter for the purchasing code. “We should consolidate those,” he said. “We’re asking for the reorganization and the usability for the benefit of our agencies and our vendors.”
He said in addition, Idaho laws could be more specific on who is responsible for what in terms of contract administration, monitoring and management; and he called for more training on procurement procedures for state employees. If agency employees were required to be trained and certified, the Purchasing Division could delegate more contract-related duties to them, with oversight, he said.