House Launches Contracting Inquiry at 11 State Agencies

State Rep. John Kuempel, chairman of the House General Investigating and Ethics Committee, launched an official inquiry Monday into contracting practices at 11 state agencies.

Kuempel requested information on contracts at the Health and Human Services Commission, where questions surrounding a $20 million, no-bid contract to Austin tech firm 21CT has prompted a string of resignations and multiple investigations.

He also asked 10 other agencies for contract information: the Texas Department of Transportation, the Texas Education Agency, the Department of Public Safety, the Department of Information Resources, the Employees Retirement System, the Teacher Retirement System, the Texas Facilities Commission, the Department of Agriculture, the General Land Office and the Department of Housing and Community Affairs.

“The House is going to find out how pervasive these irregularities are,” Kuempel, a Seguin Republican, said in a statement. “We cannot just sit here and hope that HHSC is the only agency with contracting problems.”

Kuempel gave the agencies a one-week deadline to provide information on certain contracts issued since Sept. 1, 2012, that sidestepped the traditional competitive bid process. For example, he is interested in so-called emergency contracts, as well as contracts in which the agency claimed there was only one available vendor. He also requested information on any contract from that period that involved a single vendor being paid at least $1 million and was issued under one of the state’s cooperative contracting systems, in which a single agency coordinates purchasing of certain products for multiple agencies.

The Health and Human Services Commission signed its controversial contract with 21CT through a cooperative contracts program administered by the Department of Information Resources. That program is intended to streamline repetitive technology purchases like computers and laser printers, but critics charge it has been exploited by vendors like 21CT to sidestep competitive bidding rules.

Department of Information Resources interim executive director Todd Kimbriel told a Senate committee in February that the agency followed the rules written by the Legislature and the state comptroller’s office regarding its cooperative contracts program, including with 21CT’s contracts.

At the start of the current legislative session, the House approved a rule change requested by House Speaker Joe Straus expanding the jurisdiction of the Government Operations and Ethics Committee to allow it to investigate a wide range of state agencies and practices.

“The House is serious about reforming the contracting process,” Straus said in a statement Monday. “The first thing we need to do is identify the extent of the problem.”