Auditors Find Difficulties in Figuring Out Total Number of State Contracts

A performance audit conducted by Legislative Auditor Daryl Purpera’s staff has found that the state does not require information about all of its contracts to be collected and compiled in a centralized database. That makes it difficult for legislators and other stakeholders to know exactly how many contracts the state has entered into and what the dollar amount of those contracts is.

By law, the state Office of Contractual Review (OCR) is responsible for reviewing and approving all professional, personal, consulting, and social services contracts agreed to by state agencies. OCR uses a contract management system—the Contract Financial Management System (CFMS)—to track and monitor contract information. As of November 2014, CFMS showed that Louisiana had at least 14,693 contracts totaling approximately $21.3 billion.

However, OCR only is required to approve seven of the 20 different contract types entered into by state agencies—Agency Contracts, Consulting Contracts, Cooperative Agreements, Governmental Contracts, Personal Contracts, Professional Contracts, and Social Services Contracts. The other 13 contract types totaled 8,068, or 55%, of all contracts and accounted for approximately $6.2 billion, or 29%, of the November 2014 contract amounts.

In addition, the state auditor’s report said OCR is allowed to delegate the approval process for contracts under $20,000 to executive branch agencies and to grant special delegated authority to any state agency for routine contracts in any amount. In fiscal year 2014, 72 agencies approved 4,599 contracts totaling approximately $278.6 million.

Nothing in state law requires that all entities with state contracts enter the information into CFMS. Nor does OCR have a process in place to ensure that contracts approved under delegated authority are entered into CFMS. As a result, the number and dollar amount of existing state contracts could be much higher than the November 2014 numbers indicate.