PARKERSBURG - A legislative audit report on West Virginia University at Parkersburg details nearly $60,000 in vendor donations to the college as well as the college's official response.
The 33-page Annual Purchasing Performance Audit report, presented this week to the state Legislature's Joint Committees on Government Operations and Government Organization, can be found online at www.legis.state.wv.us/Joint/PERD/reports.cfm.
The report said the school violated the West Virginia Constitution with a 2009 contract for food services that it failed to submit to the state's attorney general. This contract wrongly commits the school to a $177,000 loan to vendor AVI Foodsystems. It will end up costing WVU-P nearly $236,000, according to the report.
The audit also found WVU-P accepted nearly $60,000 worth of donations from vendors, including one such gift that apparently resulted from a vendor cutting a bid in half to win a flooring contract.
Officials with WVU-P said not reporting the contract with AVI was an oversight, but denied any wrongdoing in accepting donations from area businesses.
Officials with the college Tuesday did not list the nearly $60,000 in donations, but said only they were "products and services."
A Closer Look
According to an audit report given to the state Legislature this week, West Virginia University at Parkersburg received nearly $60,000 in donations from five area vendors who had done about $1.6 million in business with the college since 2009. The donations were:
$25,000 multipurpose room floor by Architectural Interior Products.
A 42-inch LCD HDTV and installation materials valued at $2,935 from Davis Pickering & Co. and Pro Comm Technologies.
$28,096 in chairs, tables, a bookcase, a podium and cabinets from Parkersburg Office Supply.
$2,012.47 in lighting fixtures and materials from State Electric Supply.
According to the audit report, the four donations made by five vendors were:
The report also lists the total transaction amounts between WVU-P and the five listed companies, about $1.6 million worth of business since 2009.
The audit report states there is no law prohibiting the college from taking donations, and there is no evidence of governing board member or employees at WVU-P having a financial interest in the companies donating materials. In most cases there was no evidence a donation resulted in additional contracts or work for companies.
However, the audit report points to the transaction between WVU-P and Architectural Interior Products as being a violation of state law
"AIP quoted WVU-P a $50,000 price to replace the community college's multipurpose room floor. WVU-P told AIP that it was required to competitively bid purchases costing more than $25,000. AIP then offered to sell the floor to WVU-P for $25,000 and 'donate' the other $25,000," according to the report. "WVU-P accepted AIP's offer and paid AIP $25,000 for flooring material in July 2008. It is clear to the Legislative Auditor that the purpose in accepting the lowered price on flooring was to facilitate a non-competitive sale of flooring."
The report quotes state code 5A-3-31, which says it is unlawful for a public entity to take steps to limit competition or show favoritism to a vendor at the cost of competition.
The report also states "WVU-P chose to eliminate any other vendor from consideration for the flooring. The community college does not know if the price it paid for the flooring was competitive, high, or low because it did not consider other vendors."
The report concludes "WVU-P has shown susceptibility to restricting competition."
In an emailed statement, WVU-P President Marie Foster Gnage said the move was not intended to restrict competition.
"A staff person noticed the flooring at another nonprofit organization facility and thought it would be a long-lasting flooring solution for the multipurpose room. So, the vendor was approached for an estimate," she said. "Wanting to support the college, he offered to sell the flooring at the reduced cost. The intent was never to eliminate competition: It was an effort to leverage dollars so we could do more with college funds."
The audit report included two recommendations concerning the donations.
The report also includes a letter of response from Sam Nagraj, procurement director for WVU-P, sent to state officials on Oct. 26. In the letter Nagraj addresses several items in the report, but includes only one response concerning the vendor donations.
"WVU at Parkersburg will encourage potential donors to make donations to its foundation," he wrote.
The WVU-P Foundation "raises private funds and oversees their investment and management for the benefit of WVU Parkersburg, its students, faculty, staff and community," according to the group's web page.