Panel: CT Could Reap Big Savings with More Competitive Bidding
By Keith M. Phaneuf | January 29, 2018 | CT Mirror
“A new report asserts state government could save as much as $260 million per year — and potentially more in the future — by ensuring all service contracts are subjected to competitive bidding.
But that approach, recommended by a subcommittee of the State Contracting Standards Board, also could drain major funding from the network of private, nonprofit agencies that provide the bulk of state-sponsored social services. This network has argued for more than a decade that it’s been under-funded while trying to serve increasing needs.
After reviewing all open contracts from the 2015-16 fiscal year, the contracting board’s Data Analysis Work Group found that 55 percent were not subject to competitive bidding.
And among those contracts, 73 percent of personal service agreements were not competitively bid.
“We believe a robust competitive procurement process will lower costs to the state,” the working group wrote in a report that the full contracting board will consider in February.
The data analysis group specifically projected that applying competitive bidding to all open contracts would reduce the overall cost between 8 and 12 percent. Applying that savings to all open contracts from 2015-16 creates the projected range of annual savings of $174 million to $260 million.”
“Both public- and private-sector reports have recommended that the state privatize even more social services to cut state costs.
“Nonprofits are operating on slim margins; many have closed or reduced programs and laid off staff,” Casa said, adding that the average annual cost-of-living adjustment to nonprofits’ contracts with the state over the last 25 years is less than one-half of 1 percent. “Further, many contracts that go to nonprofits require that unspent funds are returned to the state.
“Nonprofits are the way by which the state can deliver quality services, with maximum efficiency. They’re part of the solution to state budget problems.”