THE PODIUM: Denver deserves transparency for marijuana money

Denver Auditor Timothy O'Brien.

Denver City Auditor Timothy O’Brien has released a report that found city purchasing practices are too susceptible to political influence and contracting errors.

The report, released Thursday, zeroed in on a city's practice of not requiring vendors seeking to do business with the city to submit political contribution reports when bidding for competitive contracts. The city requires competitive bidding on contracts for more than $10,000 with a few exceptions.

Vendors currently are required to submit campaign contribution disclosure forms for non-competitive contracts.

But the city council removed the requirement in 2012 for disclosure forms on competitive bids to simplify the contracting process.

That streamlining came at the cost of removing transparency from the process, the audit found.

“While I recognize the desire to make doing business with the city simpler and more accessible, the easy answer isn’t always the right one,” O’Brien said. “Accountability is of the utmost importance when it comes to fairly and efficiently using taxpayer dollars.”

The audit also found that sometimes the disclosure forms submitted for non-competitive bids were not filed with the City Clerk and Recorder’s office.

The city recommended that the mayor’s office sponsor an ordinance requiring that campaign disclosure forms be filed for both competitive and non-competitive contracts.

It also recommended that all the paperwork be filed with the City Clerk’s office.

In response to the audit, a spokeswoman for Mayor Michael Hancock said the recommendations are being adopted.

“We take the responsibility of awarding contracts and spending taxpayer dollars very seriously,” spokeswoman Theresa Marchetta said in an email.

“We strive for a process that is fair, open and competitive, and we believe we have that,” she added. “There is always room for improvement and we appreciate the findings and recommendations in the audit report and are already taking steps to implement them as quickly as possible.”

The 93-page audit looked at contract bidding practices in three city agencies: Parks and Recreation, Public Health and Environment and Public Works.

It examined contracts and agreements executed by the city between Jan. 1, 2017 through Oct. 1, 2018.

The auditors originally wanted to look at citywide bidding practices, said Tayler Overschmidt, spokeswoman for the auditor’s office.

“But that was just too much to do. It would have taken us years,” Overschmidt said.

Instead, the audit team decided to focus on a sample group of three agencies that typically do a high volume of contracts, she said.

Among the report’s other findings:

• The audit found that employees and selection committee members in all three agencies were not required to file conflict of interest forms. Instead, they were asked to fill out standard annual gift reporting forms for items worth more than $50.

Parks officials responded that they have conversations with employees about conflict of interests. But without a formal disclosure of conflicts – accidental or deliberate – the audit found greater risk for abuse.

For example, an employee with a relative whose company is seeking a city contract could provide confidential information and thus influence the bidding process. Such a conflict would not be revealed by a gift disclosure form, the audit states.

The audit recommended requiring conflict-of-interest disclosure forms across all city departments for employees involved in the procurement process.

It suggested a form already being used by the city’s General Services Purchasing Department as an example that could be used citywide.

• The audit found one instance in which a non-competitive Public Works contract was awarded to a company which had made a campaign contribution to a ballot initiative campaign.

The contract described the contributions as one of the justifications for awarding that vendor the contract.

“This demonstrates apparent favoritism to that vendor,” the auditor’s office stated.

The audit states that the three agencies agreed with the recommended actions.

“This audit is an opportunity for city leaders to improve how they do business and show the people that they are, indeed, making decisions in the public’s interest, instead of their own,” O’Brien said.

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