Give state contracts an expert once-over

Editorial

Being fast should not be confused with being efficient, particularly when it comes to spending the public's money. So lawmakers should see the state's chief financial officer, Jeff Atwater, is right that empowering his agency to review state contracts and stop faulty ones could save the state millions of dollars.

Another set of eyes on state deals means another layer of bureaucracy between the time a plan is made and when it actually gets done. His proposal may run into ideological opposition from people who instinctively think smaller is better.

But Atwater has strong evidence on his side. Florida has no uniform standards for contracts. State employees spending state money have no clear guidelines, he says, so oversight is fragmented and difficult.

The state's CFO can't be sure that taxpayers' money is being spent with care. But he has good reason to suspect that loosely worded contracts are costing the state lots of money.

His misgiving is based on a review of 364 contracts and grant agreements, each worth at least $1 million, for the 2010-2011 fiscal year. After putting the fine print in each contract under his magnifying glass, Atwater reports that 26 percent had problems that were potentially costly.

A good, tight contract, Atwater says, will clearly define the scope of work. It will say exactly what product or service is to be delivered. It will set standards for quality and impose deadlines. It will make clear what financial consequences will be triggered by unacceptable performance.

These are not radical concepts. They're the kind of things a smart homeowner would get in writing before hiring a contractor to make a major repair.

"Are we getting what we think we're paying for?" Atwater asks. In order to have the information he needs to answer that question, he is asking for the power to evaluate all contracts of $50,000 or more and to recommend changes. If he finds holes in a contract, Atwater would reject it and send it back to the submitting agency to be rewritten. He would not take the contract-writing power away from other agencies.

He estimates the state is writing about $13 billion a year in questionable contracts but is unsure exactly how much could be saved. He thinks it would be a big number.

"There are tremendous savings to be had," he tells us.

He also wants state agencies to be able to explain to losing bidders why someone else won and what they could do to be more competitive next time. That could encourage more and better bids and save taxpayers even more money.

A large part of the state budget is spent on goods and services. It's more than the state spends on salaries. There are contracts for janitorial service, printing, fuel, communications, medical care, rent, roads, consulting, food and repairs. The list goes on and on.

Initially the requirement might slow the process a bit, but it shouldn't take state bureaucrats long to learn how to write contracts right. Atwater proposes training sessions that lead to certifying contract managers. Someone who refuses to follow the guidelines would lose certification and, along with it, the authorization to spend state money.

Once the sloppy contracts are being caught and rejected, fewer will be written, and Atwater's review will speed up as the cost of running the state goes down. Lawmakers should approve the change to bring more accountability and oversight to state spending.