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Audit: Departments don’t follow rules for buying, awarding contracts

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RICHMOND, Va. (WTVR) - According to the City Auditor, the  Richmond Procurement Department has made significant improvements this year compared its last audit in 2008. However, the latest audit finds there is room for more improvement.

In the 20-page report, Richmond City Auditor Umesh Dalal said city departments have failed to follow the requirements for buying goods, services and construction contracts.

Contracts like the one to build the brand new Justice Center. That project has come under harsh criticism by the NAACP in recent months over the way the city handled the process.

The report found that of the 97 transactions reviewed by the Auditor, 63 payments or more than half totalling $3,500 went to the same vendor.

"We welcome audit. And we welcome any findings that will allow us to improve. And we hope as we go through future audits, we'll have a better opportunity to make any comments relative to the recommendations," said Sharon Judkins, Chief Administrative Officer for Finance and Administration.

City departments are required to get three quotes for purchases over $5,000 -- and that must include a quote from a minority-owned business.

However, when it comes to awarding minority-owned business contracts, Dalal said those firms are not getting a fair share of the pie. In fact, the auditor's findings show only 20 percent of minority owned businesses awarded contracts. And of those, the same ones keep getting hired over and over.

Thursday, the director of the Office of Minority and Business Development defended the city's position.

"Please, ladies and gentlemen understand that a staff of 7 servicing the entire city is actually out there doing what we are suppose to be doing," said Vickie Rivers, the director of the Office of Minority and Business Development. "We will be answering those policies and procedures to include more information relative to our process."

Both department heads within those city agencies rejected all of the auditor’s recommendations, but are now working with Dalal to make the needed improvements in those departments.

Stay with CBS 6 News and for continuing coverage of this developing story.