State auditor says Dept. of Ed mishandled bidding process using federal funds, something MDE disputes
Mississippi State Auditor Shad White announced his office’s annual report on the state’s federal spending Tuesday, with a special focus on the Mississippi Department of Education’s bidding process to secure computers for school children.
White said the department mishandled choosing a vendor, ultimately giving special treatment to the winning company. That critique, along with other missteps the report details, is something MDE has denied in a letter to the auditor’s office.
White called the 388-page report the most “important report in the state of Mississippi” on whether “federal money actually helped people.”
“From a small county to a big state agency, folks around the state need to know we’re watching these processes,” White said during a Tuesday phone call with reporters.
The annual audit spanned the largest amount of federal funds the office has ever examined in a fiscal year since the 2008 financial crisis. It covers the fiscal year ending June 30, 2021, including the $1.25 billion of Coronavirus Aid, Relief and Economic Security (CARES) Act money allocated by the Legislature.
In 2020, the Legislature allocated $150 million of COVID relief money to purchase computers for remote learning at the beginning of the pandemic. The Department of Education was responsible for managing this process; school districts were required to contribute 20% of their own federal money for their computers, and the remaining 80% would be covered by the federal funds disbursed by the Legislature. The law also gave MDE the ability to select a vendor and make a bulk purchase for participating districts across the state.
The report says the Department of Education let the winning vendor — an Illinois company called CDW — have influence over the criteria for proposals before they were released, and gave the company multiple weeks advance notice of what the criteria would be.
“All vendors selected by MDE were allowed to provide input on the specifications,” MDE wrote in its response letter to the auditor’s office. “The scheduling of these meeting dates … were not solely driven by MDE but were set based on vendor availability. All meetings were scheduled as quickly and as often as practicable under the circumstances.”
MDE dubbed the plan Mississippi Connects. White chastised the agency in 2020 because he said the department required schools to purchase computers from a preferred vendor list to receive the 80/20 match, something MDE also disputed.
In his latest report, White also pointed out that CDW scored better on one section despite being more expensive than other bids. MDE said in its response letter, which was dated in October of this year, the company received more points because of CDW’s promise to deliver the computers by a Nov. 20, 2020 deadline.
White, however, says that all vendors had committed to delivering the devices by the deadline in their cost estimates.
The report also pointed out the Department of Education failed to properly monitor federal funds given to nonprofits that provides meals to hungry children and adults to ensure the money was, in fact, fulfilling that purpose. In their October letter, MDE also disputed this claim.
Separately, the report highlighted $453 million that was improperly administered through unemployment, and up to $69 million that may have gone to fraudulent Medicaid recipients.
The federal government will examine the state’s report — as it does every state’s annual audit report — to determine if any clawbacks for misspent funds are necessary.