Report 2011-120 Recommendation 34 Responses

Report 2011-120: California Department of Transportation: Its Poor Management of State Route 710 Extension Project Properties Costs the State Millions of Dollars Annually, Yet State Law Limits the Potential Income From Selling the Properties (Release Date: August 2012)

Recommendation #34 To: General Services, Department of

To ensure that the construction unit complies with the State's procurement laws and policies, General Services should require the construction unit to modify the procurement section of its manual to conform to the State's procurement laws and policies.

1-Year Agency Response

Subsequent to the audit, DGS has significantly changed its policies, procedures and responsibilities for procurement which alleviates the need for this recommendation. Specifically, effective July 1, 2013, DGS consolidated its purchasing and contracting functions in a new office within its Administration Division, the Office of Business and Acquisition Services (OBAS). Consequently, DCU is no longer responsible for those activities. Instead, the responsibility rests with OBAS' professional procurement staff.

The DCU's role in the new procurement system is primarily limited to requesting a purchase and certifying the receipt of the goods. OBAS is now responsible for ensuring that DGS procurement practices fully comply with state requirements. This responsibility includes complying with state requirements governing the rotation of suppliers, conduct and documenting of fair and reasonable pricing analyses and verification of the performance of a commercially useful function by certified small businesses and disabled veteran business enterprises. These areas were the primary areas of concern discussed in the audit report.

California State Auditor's Assessment of 1-Year Status: Resolved

6-Month Agency Response

General Services stated that the construction unit is updating the procurement section of its policy manual to conform to the State's procurement requirements and plans to issue its updated policies by April 30, 2013.

California State Auditor's Assessment of 6-Month Status: Partially Implemented

60-Day Agency Response

General Services stated that the construction unit is updating the procurement section of its policy manual to conform to the State's procurement requirements and plans to issue its updated policies by November 30, 2012. (See 2013-406, p. 176)

California State Auditor's Assessment of 60-Day Status: Partially Implemented

All Recommendations in 2011-120

Agency responses received after June 2013 are posted verbatim.