New Jersey State Telecom Audit Saves 3.5 Million

July 11th, 2010 by Telecommunications-editor

Audit finds $3.5 million in phone bill savings
By BETH DeFALCO (Associated Press) – July,2010
TRENTON, N.J. — New Jersey state government has wasted millions of dollars because of unused phone lines, a new state audit released Wednesday concluded.

The comptroller audit said more than 19,000 phone lines, or nearly one in every six in 2009, should be disconnected because they go unused or are no longer needed. In addition, some telecommunications contracts have been renewed without the competitive bidding process as required by law, the audit said.

“The state is paying hundreds of thousands of dollars every month for phone lines that are not even being used,” said state comptroller Matthew Boxer. “Examples of government waste don’t get much clearer than that.”

Responding to the findings, state departments disconnected or suspended each of the phone or data lines at an overall yearly savings of more than $3.5 million.

One example of waste found by auditors included the state continuing to pay for the wireless line of a former employee for almost six years after her resignation. They also found:

Over the course of one year, the state paid more than $250,000 in directory assistance fees when toll-free assistance was available.
The state is owed more than $43,000 for data lines that were disconnected in 2008 and 2009. The state continued to be billed for lines even after they were disconnected.
Many departments were not documenting the justification for paying for wireless devices for employees; about 19,000 devices — cell phones, Blackberrys and air cards — are currently assigned to executive branch employees.

Adel Ebeid, the state’s chief technology officer, said keeping track of unused lines is more difficult than it seems.

“Unfortunately we have no way of knowing which agency personnel are being hired, transferred, or terminated which is why the current policy places the notification responsibility with the individual designated by an agency to coordinate and manage their respective telecommunication services,” Ebeid wrote.

He said he has asked human resource managers to become involved with the issuance and termination of phone lines because they are familiar with the employment status of workers.

Ebeid also said memos have been sent in previous years, asking state employees to stop using the pay-per-use directory assistance service. He said he has contacted Verizon Wireless and asked them to block 411 directory assistance calls from all New Jersey state-issued phones.

The audit also found that the state renewed some of its major telecommunications contracts for more than a decade without opening the contracts up to competing bids as required by law.

Of four contracts reviewed, auditors found that each was extended at least seven times without going through the bidding process; one was extended 22 times without competitive bidding.

“The state has prevented fair vendor competition in its telecommunications contracts for more than a decade and essentially handed out a no-bid contract with each extension,” Boxer said. “As a result, the public cannot be sure that the state is getting a fair price.”

Ebeid said contract extensions were sought only after significant discounts were offered. As a result, he said, the state pays $12 million less than it did in 2007.

The comptroller’s report suggested that telephone coordinators in departments be required to periodically justify the need for all land lines not being used; review zero-usage reports and justify the need for those lines; and better monitor bills to make sure the state is not being billed for disconnected lines.

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