Comptroller: Village Did Not Seek Bids for Contracts

State Comptroller Thomas DiNapoli has found that the Village of Port Jefferson spent more than $1.5 million on projects and municipal goods without a competitive bidding process, according to an audit released Thursday.

According to DiNapoli, the village spent $691,584 with 13 vendors and $811,496 with 10 professional service providers without taking bids. The village also failed to create written contracts in some cases, according to the audit.

"For example, the Village did not solicit competition when selecting a vendor to operate the Village’s Golf Pro Shop, or enter into a signed agreement with that vendor. As a result, the Village may not be obtaining goods and/or services at the lowest possible price," the comptroller wrote.

The Comptroller's office reviewed the village's finances for the period between June 1, 2009 through Aug. 31, 2010. In a statement, the New York State Comptroller's office said it had completed a total of five town and village audits, including Port Jefferson.

"We use a risk assessment process to help us identify audits," said Vanessa Lockel, who works for the Comptroller's office, on why Port Jefferson village was chosen to be audited.

That risk assessment takes into account a host of factors including financial data, media reports, complaints from taxpayers, information provided by local officials and the time since the last audit was done among others, according to Lockel.

Mayor Margot Garant said that State law does not require municipalities to bid for many of the professional services that the village has contracted.

One example is hiring an attorney when a case involves potential litigation, as was the case when the village hired lawyers to take up issues against the National Grid-owned power plant and the Long Island Power Authority's tax grievence.

She also said that the village usues a list of approved contractors and suppliers provided by the Town and County who have already put out bids.

The village recently set up a new purchasing policy that mandates competitive bidding. If the purchasing department wants to spend over $500 they need now to get at least three bids, according to Garant.

But DiNapoli's audit found several other areas of concern.

For starters, the comptroller took issue with the past Village Assessor role, which he said was more akin to an independent contractor than a public official and therefore difficult to make sure they are following regulations.

Also, DiNapoli said the village's lack of written policies around payroll, specifically about sick time and leaves of absence, led to the village overstating the value of sick time and leaves by $192,000.

"For example, one employee would have received $29,252 for unauthorized vacation leave upon separation from service," DiNapoli wrote.

Garant wasn't sure at the time of the writing of this article which employee that vacation leave refered to but said she would look into it.

She explained that previously, some village employees had the ability to accumulate vacation time virtually unlimited.

"We just instituted a policy of 'use it or lose it,'" Garant said, maxing out any employee at 60 days of accumulated carryover vacation time.

DiNapoli also said the village's information technology services exposed the municipality to possible loss or misuse because the village does not set up rigid permissions or back up its data.

Garant said that auditors worked with the village for almost six months starting last Spring. An exit interview to review the findings occured on Dec. 27. She said that in that time the village has mostly brought things into compliance with the audit's reccomendations.

"Sixty-five percent of the things in the report we corrected," she said.

In a letter attached to the audit, in which she claimed to be in agreement with the comptroller's findings, Garant said the village board has appointed an official assessor, standardized its payroll methods for sick time and leaves and has updated its IT systems.

The Comptroller's office said that the issues in the audit report are fairly typical findings for a village like Port Jefferson. While the Comptroller does not have authority to force local governments to address any of their recommendations, general municipal law says that they should prepare a corrective action plan that addresses the findings and recommendations within 90 days of the report being issued.

Following up on the audit is also based on the Comptroller's risk assessment process, according to Lockel.

"We generally would not schedule a follow-up audit for at least a year after the report is issued to give them sufficient time to implement changes," she said.

See the gallery for the PDF of the full audit.