The State of Utah overpaid a janitorial contractor by $677,669 after one of its own employees falsified procurement documents and made improper contract changes.
The Division of Facilities Construction and Management recovered some of the money, but $291,650 is gone, according to a September state audit.
Key facts: The problems involved janitorial services at the Taylorsville State Office Building, a 415,000-square-foot complex housing more than a dozen government agencies.
Auditors said the employee responsible for the contract worked mostly in isolation. Reviewers failed to catch inappropriate contract amendments before invoices were paid. The employee was eventually placed on leave for falsifying procurement documents and later terminated.
“This situation demonstrates a failure by prior leadership to establish monitoring and oversight mechanisms sufficient to detect errors,” the auditors wrote.
It’s unclear why the former employee decided to send extra taxpayer money to the janitors. The state referred the matter to law enforcement, but the facilities division couldn’t provide enough documentation to determine whether the former employee personally profited from the scheme.
The janitorial payments were part of a much larger oversight problem.
Auditors reviewed 18 state construction projects and found that 17, worth at least $17 million, proceeded without required oversight from the facilities division. Six were examined for building code compliance, and all six had violations. Some created potential fire-safety or structural risks, auditors found.
The division also failed for decades to comply with a state law requiring them to report the cost of completed projects to lawmakers. The agency told auditors it did not know about the requirement.
The agency agreed with all 10 recommendations in the audit, including new management reviews designed to catch improper invoices and contract amendments.
Background: The Division of Facilities Construction and Management oversees 3,785 state buildings worth more than $12 billion. Director Andy Marr made nearly $194,000 last year.
Its workload expanded again in July, when Utah put the agency in charge of overseeing public school construction.
Summary: The agency responsible for catching costly mistakes in Utah construction projects missed one inside its own office. Taxpayers are still cleaning up the mess.
The #WasteOfTheDay is brought to you by the forensic auditors at OpenTheBooks.com.
