GOWANDA - The village of Gowanda was recently audited by the Of-fice of the State Comptroller for its procurement policy and procedures.
In the audit recently released, a period from June 1, 2011 to April 26, 2013 was audited.
The village has a procurement policy and was adopted as a general municipal law. Under the law, any purchase over $10,000 or public works purchase over $20,000 is required to go to bid.
For purchases between $3,000 and $9,999, the village is required to get two written quotes and three telephone quotes are required for public works purchases between $5,001 and $9,999.
Anything over $10,000 for public works contracts require at least two formal written proposals. Purchases made on county and state bid do not require bids. Once solicited, bids shall be opened and reviewed with the lowest bid being awarded, the law reads.
The audit formally looked at 16 purchases from the fiscal years 2011-2012 and 2012-2013 totaling $408,028, all of which required bids, quotes or were purchased on state and county contracts.
"... We found that purchases were not formally bid or awarded by the Board, quotes were not always obtained, and Village officials did not determine if they received the correct State or County contract pricing," the audit states.
Under competitive bidding, the audit found three purchases totalling $138,163, which were subject to bidding requirements. Village officials did not publicly solicit bids for two of those three purchases and the final purchase, there was no evidence the village obtained any bids for sludge removal which cost $30,828. The village also purchased a new police vehicle at a cost of $21,575 without soliciting bids since it was an "emergency." Instead, three proposals were obtained and the lowest cost was awarded the contract.
"According to the Board minutes, two police vehicles had over 120,000 miles and were in need of repair. We question whether the need to replace a police vehicle was unforeseen by Village officials to the extent that it precluded them from formally soliciting bids for the purchase," the audit reads.
Another purchase which required competitive bids was a purchase for sewer plant chemicals. The chemicals were purchased for $48,947 and for $36,813 from a vendor that submitted a bid with a higher price. The audit states the village said the public works superintendent "deemed the less expensive product inferior." The OSC could not find any documentation to support this claim, however. There was no indication in the board minutes the chemical bid was awarded to that particular vendor, just that the public works superintendent was testing both products from the vendors.
Under state and county contracts, the village made six purchases totaling $210,095 but for four of those purchases no supporting evidence was found that the village verified the state or county bid. Purchases for asphalt for $63,296, diesel fuel for $51,334, unleaded gasoline for $48,070 and police car radios and chargers for $10,835 had no such evidence. Since the police car radios purchase price was not verified, the village spent $2,439 more than the state contract price.
The audit also found the village did not "properly obtain written quotes" for five of seven purchases totaling $44,449. The purchases included water main repairs ($5,495), water treatment chemicals ($3,064 and $3,040), air tanks ($4,275), a gas detection system ($14,540) and tree and stump removal (($14,085).
"The Board's failure to ensure that Village officials obtained bids and quotes in accordance with the Village's procurement policy, and to verify that they were receiving the correct State and County contract pricing, resulted in the Village incurring higher costs than necessary for goods and services purchased," the audit said.
The OSC recommends the village comply with the adopted procurement policy and approve purchases and contracts through competitive bidding processes, attach obtained quotes to vendors' claims and village officials should determine they are receiving appropriate state and county contract pricing. All information regarding bids should also be attached to vendors' claims for review and approval.
Mayor Heather McKeever responded to the audit by saying the village appreciated the audit and see the process as a "helpful reminder of areas that need more attention."
"Firstly, we would like to say that the village takes its responsibility to adhering to state guidelines very seriously," she said. "Although we make every effort to comply, we acknowledge that there may be times when we fail to do so however unintended."
McKeever said the sludge removal work was not competitively bid since it was emergency work following the 2009 flood. She also said the water main repair work was done on a weekend in an emergency situation which is why there were no competitive bids. She also addressed the chemicals being purchased on the higher bid.
"As mentioned in the findings, our Public Works Superintendent felt that the vendor with the lower bid was offering a product that did not meet the specifications for the use intended. We agree with this finding and realize that documentation of his concerns should have been put in writing and noted in the board minutes," McKeever added.
The village agreed with some recommendations made by the OSC. The village officials agreed with the state and county contract recommendation, noting the village now checks contract pricing online. They also agreed the police vehicle should have been addressed sooner preventing an emergency situation and the village should obtain written bids for all purchases requiring to do so. To see the complete audit report, visit www.osc.state.ny.us/localgov/audits/villages/2013/gowanda.pdf.
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