Montana’s Office Public Instruction temporarily lost its authority to enter into high-price contracts for goods and services Tuesday after the Department of Administration discovered deficiencies in the agency’s practices.
In a memo sent to state Superintendent Elsie Arntzen, the department notified OPI that it had received a score of 57% in a recent review of its contracting procedures — a score DOA characterized as “failing.” According to the memo and other documents obtained by Montana Free Press, DOA’s review found that OPI failed to retain adequate records about its solicitation and execution of contracts for third-party services.
The review also determined that OPI had not adequately trained its staff on the policies governing the solicitation of bids and awarding of agency contracts, and that OPI failed to show that it had verified the eligibility of vendors prior to awarding contracts.
“Effective immediately, OPI must submit all procurement activity over the small purchase threshold (with a total contract value of $10,000 or more) to [the State Procurement Bureau], and SPB will complete the procurement action on behalf of OPI,” State Financial Services Division Administrator Cheryl Grey wrote in the memo.
OPI is charged with overseeing Montana’s K-12 public education system and is one of four agencies headed by an independently elected statewide official. The State Procurement Bureau is a branch of DOA, which falls under the oversight of the governor’s office.
According to DOA spokesperson Megan Grotzke, the authority to procure goods and services through contracts is delegated to individual Montana agencies, and DOA monitors that activity to ensure compliance with state law. Grotzke added the review that resulted in OPI’s suspension was instituted as the result of a legislative audit in 2018, and that no other agencies have had their procurement authority suspended in the recent past.
DOA’s memo directed the Office of Public Instruction to submit a corrective action report by April 28, detailing how the agency plans to address the deficiencies. Grotzke confirmed that OPI’s suspension will hold “until they correct the deficiencies.”
In response to a list of questions from MTFP, OPI spokesperson Brian O’Leary emailed the following statement Friday on behalf of Arntzen:
“The DOA is and always has been ultimately responsible for state contracting. OPI staff looks forward to working with DOA staff to ensure their expectations are met about that process.”
O’Leary also noted that no existing contracts or legal obligations will be impaired by OPI’s suspension.
The Montana Legislature has debated several bills this year seeking to revise Montana’s procurement and spending practices. Among those is House Bill 367, sponsored by Rep. Bill Mercer, R-Billings, which would apply additional restrictions to how OPI uses federal COVID-19 relief funds to modernize its educational data systems. During a House Appropriations Committee hearing in early February, Mercer pointed to a portion of HB 367 that would allow DOA to review and approve OPI’s methods in contracting for the work and give DOA oversight in approving those contracts.
“An $8 million expenditure is something where we would want to make sure that there was viable competition between potential vendors,” Mercer told the committee, “and it’s important to have the Department of Administration serving a role to facilitate that process.”
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