An Audit Report on Selected Contracts at the Department of Criminal Justice
Report Number 14-019
The Department of Criminal Justice (Department) sufficiently complied with applicable criteria in its planning, procurement, and formation of two contracts audited related to the operation of two private facilities. Those facilities are:
- East Texas Treatment Facility (East Texas Facility).
- Lockhart Work Program (Lockhart Program).
Those two private facility contracts audited were awarded in fiscal years 2008 and 2009; renewed during their option periods; and totaled $161,145,898 and $49,328,510, respectively, through fiscal year 2013.
For the two contracts audited, the Department generally monitored vendor performance and properly processed payments for those facilities. In addition, the Department developed tools, such as on-site review checklists and monthly desk reviews, to monitor compliance with the facility operational requirements and treatment program requirements. However, it should strengthen those processes to ensure that (1) its monitoring reviews adequately address all contract requirements, including those from contract modifications; (2) it performs scheduled reviews; and (3) it reports all identified noncompliance to ensure that contractors meet the operational and performance requirements of the contracts. Specifically:
- The Department should align its monitoring tools for operational compliance reviews, such as on-site compliance checklists, with the contract requirements for the East Texas Facility and the Lockhart Program and use the results of those compliance reviews to hold contractors accountable for meeting contract terms. The Department's on-site contract monitors also should verify self-reported information from the contractors during their compliance reviews.
- The Department should review all treatment program requirements, report all instances of noncompliance to the contractor, periodically verify self-reported performance measure information from the contractors, and enforce payment sanctions when applicable.
Auditors also reviewed the Department's oversight of the statewide fuel contract totaling $13.4 million in fiscal year 2012 and $13.0 million in fiscal year 2013. The Department sufficiently coordinated efforts with the Office of the Comptroller of Public Accounts' Texas Procurement and Support Services (TPASS) division to issue blanket purchase orders for that contract. In addition, it conducted oversight of the contract in accordance with applicable statutes and rules and its policies and procedures.
Auditors communicated a less significant issue related to contract procurement to the Department separately in writing.
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