Report No. 2009-37
Complete Audit Report
The following findings were included in our audit report on the City of St. Louis, Information Technology Services Agency.
The City of St. Louis Information Technology Services Agency (ITSA) is responsible for the City Wide Area Network (WAN) and provides IT functions to 109 city of St. Louis departments and city-related agencies.
Significant concerns were noted regarding the city's contractual relationship with a consultant that provided network systems services to the ITSA. The city awarded a contract in 2005 to United Forensics, a network services consulting company, to provide various maintenance and upkeep services for the city's computer network. The city paid United Forensics approximately $1 million from 2005 to 2008. The ITSA did not retain adequate documentation regarding the award of the United Forensics consulting contract in 2005 as required by city rules and regulations. In addition, the exact value of the approved contract amount was not clear.
The ITSA and the city approved annual contract extensions with United Forensics that significantly increased the total value of the contract and the hourly rates to be paid by the city; however, these contract extensions were approved without considering proposals from other vendors. The original value of the contract was not to exceed $194,000 for fiscal year 2006, increased to $450,000 for fiscal year 2007, and also set at $450,000 for fiscal year 2008. In addition, the hourly rates paid by the city for contractual services increased significantly in fiscal year 2008.
During the first quarter of 2008, one of the owners of United Forensics created a company called Access Forensics. The ITSA began utilizing the services of Access Forensics and discontinued utilizing the services of United Forensics. The ITSA did not adequately document the reasons for discontinuing the services of United Forensics, and it appears the city may have made payments to Access Forensics without a valid written contract.
The ITSA approved payments to United Forensics for services that appeared unreasonable or were not specifically allowed by the contract including administrative costs, holiday pay, unspecified and duplicate charges, and charges at unauthorized billing rates.
Also included in the audit are recommendations related to other contracts and software agreements.