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State could have saved $3.5 million on temps

January 06 2009

The state auditor for North Carolina issued a report today saying five state agencies could have saved up to $3.5 million in the use of temporary workers if they had used an open and competitive bidding process.

Auditor Leslie Merritt's report covers approximately $28 million in staffing services purchased from eight companies between July 1, 2005, and Jan. 31, 2008.

"Significant savings could be realized by using the State's buying power to control administrative expenses," Merritt said. "Issuing a statewide convenience contract(s) through a competitive bidding process could save North Carolina taxpayers significant money and reduce legal risks."

The report also found that business and legal risks are not well managed and written contracts are rarely used.

"The lack of written contracts between state agencies and temporary staffing vendors and the nature of some working arrangements increase the risk of dispute, litigation and liability to the state," the report said.

In addition, the report found some state retirees returning to work through staffing firms do not comply with the state's return-to-work laws. The state's Retirement Systems Division paid $633,000 to 27 retirees who were out of compliance with the return-to-work laws, according to the report.

For the report, click here.

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