Audit: State could have saved on temps

RALEIGH -- State Auditor Leslie Merritt said today that the state could have saved up to $3.5 million in administrative costs if it had used an open and competitive bidding process to control the administrative mark-up rate of vendors who provided temporary staffers.

Merritt's findings stemmed from a performance audit on State agencies' use of temporary staffing vendors.

The audit also charged that business and legal risks are not well managed, that written contracts are rarely used and that some state retirees who work for temporary staffing vendors do not comply with return-to-work laws.

The audit covered temporary staffing services purchased from eight commercial vendors between July 1, 2005, and Jan. 31, 2008, by the departments of health and human services and transportation, the Wildlife Resource Commission, the state treasurer and the Office of Information Technology Services. All five agencies agree with the findings and recommendations, Merritt said.

"Significant savings could be realized by using the state's buying power to control administrative expenses," Merritt said in news release. "Issuing a statewide convenience contract[s] through a competitive bidding process could save North Carolina taxpayers significant money and reduce legal risks."

The audit found that retirees returning to work for the state through temporary staffing vendors are sometimes out of compliance with the return-to-work laws, Merritt said. The Retirement Systems Division unknowingly made about $633,000 in retirement payments to 27 retirees who were out of compliance with the laws.

"Agency managers and retirees that think that return-to-work laws do not apply to temporary staffing assignments are simply ill informed," Merritt said.