NEWS RELEASE
For Immediate Release
Contact: Steve Halvonik 717 787-1381

Auditor General Jack Wagner says PLCB Contract Review Will Focus on Bidding Process, Conflicts of Interest

HARRISBURG, March 20, 2009 – Auditor General Jack Wagner said today that his review of a $173,000 contract that the Pennsylvania Liquor Control Board awarded to a Pittsburgh firm owned by the husband of the PLCB’s regional manager for Western Pennsylvania would focus on the bidding process used for procuring professional services.

Specifically, Department of the Auditor General agents would look at whether the PLCB awarded the contract according to state code and PLCB policy, and would determine whether any conflict of interest existed between PLCB officials and Solutions 21, the Pittsburgh firm that received the contract to provide customer service training to nearly 4,000 PLCB employees.

“Additional objectives may be added as deemed necessary during the course of our work,” Wagner said in a letter, hand-delivered Thursday, to PLCB Chairman Patrick J. Stapleton III.

Wagner said that work would begin immediately and that he expected to issue a report next month.

“We believe this letter accurately summarizes the significant terms of our engagement,” Wagner said.

The Department of the Auditor General announced March 13 that it would accept Stapleton’s request and conduct a review of the contract. Competing bidders charged that the PLCB rushed its decision to award the training contract to Solutions 21, whose president, Buddy Hobart, is the husband of Susanne Hobart, regional manager in Western Pennsylvania.

“State agencies must go the extra mile, especially during difficult financial times, to assure taxpayers that there is no favoritism or conflict of interest occurring in the awarding of contracts to private vendors,” Wagner said.

“The Department of the Auditor General strives to maintain the highest level of independence and professionalism in its dealings with auditees,” Wagner’s letter said.

The Department of the Auditor General’s Bureau of Federal Audits is required by law to conduct an annual financial audit of the Liquor Control Board. The last audit was issued for the fiscal year ending June 30, 2007. In addition, the department’s Bureau of Liquor Audits completes annual performance audits of the individual state liquor stores.

Auditor General Jack Wagner is responsible for ensuring that all state money is spent legally and properly. He is the Commonwealth’s elected independent fiscal watchdog, conducting financial audits, performance audits and special investigations. The Department of the Auditor General conducts more than 5,000 audits per year. To learn more about the Department of the Auditor General, taxpayers are encouraged to visit the department’s Web site at www.auditorgen.state.pa.us.

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