Compliance Plan Fiscal Year 2021
30 ILCS 5/2-16
Statutory Requirement
Public Act 100-0801 amended the Illinois State Auditing Act to provide the following new section:
(30 ILCS 5/2-16 new)
Sec. 2-16. Contract aspirational goals. The Auditor General shall establish aspirational goals for contract awards substantially in accordance [with] the Business Enterprise for Minorities, Women, and persons with Disabilities Act, unless otherwise governed by other law. The Auditor General shall not be subject to the jurisdiction of the Business Enterprise Council established under the Business Enterprise for Minorities, Women, and Persons with Disabilities Act with regard to steps taken to achieve aspirational goals. The Auditor General shall annually post the Office’s utilization of businesses owned by minorities, women, and persons with disabilities during the preceding fiscal year on the Office’s Internet websites.
The purpose of this report is to set contracting goals, a plan for achieving those goals, and the results of our efforts as required by P.A. 100-0801.
Policy Statement
The Auditor General’s Office adopts the public policies set forth in the Business Enterprise for Minorities, Women, and Persons with Disabilities Act [30 ILCS 575/1]. Specifically, it is the public policy of the Auditor General’s Office to promote and encourage the continuing economic development of minority-owned (MBE) and women-owned and operated businesses (WBE, WMBE) and that minority-owned and women-owned and operated businesses participate in our procurement process as both prime and subcontractors. It is also the public policy of the Auditor General’s Office to promote and encourage the continuous economic development of businesses owned by persons with disabilities (PBE). Further, although no specific aspirational goals are established in the Act, it is the policy of the Auditor General’s Office to promote and encourage the economic development of service disabled veteran owned small businesses (SDVOSB) and veteran owned small businesses (VOSB).
Legal Basis
The Business Enterprise for Minorities, Women, and Persons with Disabilities Act [30 ILCS 575/] sets specific dollar value aspirational goals for State contracts/subcontracts with MBE, WBE and PBE businesses. In 2015 the Department of Central Management Services commissioned a disparity study that concluded “[i]n our judgment, the state has a strong basis in evidence to continue its M/FBE program and to employ narrowly tailored remedies to ameliorate discrimination.” [State of Illinois Department of Central Management Services Disparity Study 2015, Colette Holt & Associates, page 3] The Auditor General’s Procurement Rules permit the OAG’s Chief Procurement Officer to “establish goals and other such preferences for contracting or subcontracting with businesses owned and controlled by minorities, women and persons with disabilities.” [44 ILAC 500.1190]
Aspirational Goals
The Auditor General’s Office adopts the aspirational goals set forth in the Business Enterprise for Minorities, Women, and Persons with Disabilities Act [30 ILCS 575/]. Specifically, “not less than 20% of the total dollar amount of State contracts. . .shall be established as an aspirational goal to be awarded to businesses owned by minorities, women, and persons with disabilities. . .contracts representing at least 11% shall be awarded to businesses owned by minorities, contracts representing at least 7% shall be awarded to women-owned businesses, and contracts representing at least 2% shall be awarded to businesses owned by persons with disabilities.” [30 ILCS 575/4]
Aspirational Goals Expressed in FY21 Dollar Amounts
All terms are as defined in the Business Enterprise for Minorities, Women, and Persons with Disabilities Act [30 ILCS 575/]. In classifying contractors and subcontractors, we relied upon certifications from the Department of Central Management Services as shown on its website at https://cms.diversitycompliance.com/.
Beginning of Year - Projected FY21 Contract Dollar Amounts:
FY21 appropriations total $38,999,370 [P.A. 101-637]. Estimated payroll, fringe and travel costs (which are not subject to contracting) are $8 million. The appropriation balance of $30,999,370 (rounded to $31,000,000) represents the approximate dollar value of contracts subject to the aspirational goals during FY21. Twenty-percent of $31,000,000 results in an overall aspirational goal for FY21 of $6,200,000, broken down by category as follows:
|
11% minority-owned (MBE) |
$3,410,000 |
|
7% women-owned (WBE) |
$2,170,000 |
|
2% persons with disabilities (PBE) |
$620,000 |
|
Total FY21 Goal |
$6,200,000 |
FY21 Action Plan
Quantitative Results: The OAG fulfilled its MBE and WBE aspirational goals during FY20. However, at the beginning of FY21, a large MBE-certified firm doing business with our Office was acquired by a non-MBE firm. The same minority employees continue to staff the engagements with our Office but the contracts are now held by the non-MBE firm. As a result, while our contracting aspirational goals were negatively affected, the diversity of staffing on our engagements remained the same.
Qualitative Results: We are mindful of barriers to contracting/subcontracting with the OAG that may impede participation in our audit program by MBE, WBE, WMBE, PBE, SDVOSB and VOSB businesses. As a consequence, we took the following actions during FY21:
i) Accessed CMS’ vendor portal at https://cms.diversitycompliance.com/.
ii) Input NIGP (National Institute of Government Purchasing) codes to identify vendors who are certified in codes that may contain skill sets relevant to our audit program:
91804: Accounting, Auditing, Budget Consulting
94620: Audit Services
94631: Certified Public Accountant (CPA) Services
96403: Accounting, Auditing, Bookkeeping Personnel
2. Developed list of new possible MBE, WBE, WMBE, PBE, SDVOSB and VOSB audit firms (eliminated firms already in our program and firms that have already been contacted during the preceding two years).
3. These efforts identified more than ten additional firms to which we sent letters providing information about our Office and identifying a liaison with our Office to whom those firms can direct specific questions about our audit program, procurement opportunities, and prequalification requirements.
4. Unfortunately, outreach efforts from the prior year did not result in any new MBE/WBE firms becoming prequalified with our Office during fiscal year 2021.
5. As predicted, our percentage of MBE contracting did go down, but the contractors working with our Office are the same minority employees we worked with before, they are just now working for a larger non-MBE firm.
End of Year - Actual FY21 Contract Dollar Amounts:
Quantitative Results: Total expenditures in FY21 were $33,372,546. Of that amount, total expenditures subject to contracting were $26,097,009 (rounded to $26.1 million), after excluding detail objects codes that are not competitively procured, such as personal services and fringe benefits, travel reimbursements, employee reimbursements, postage, and internal service fund charges.
|
% Goal by Category |
FY21 Goal based on $26,100,000 in actual expenditures |
$ Amount expended in FY21 toward goals (prime & sub) |
% Amount expended in FY21 toward goals (prime & sub) |
|
11% minority-owned |
$2,871,000 |
$278,690 |
1.07% |
|
7% women-owned |
$1,827,000 |
$2,712,756* |
10.39% |
|
2% persons with disabilities |
$522,000 |
$0 |
0% |
|
Total 20% |
$5,220,000 |
$2,991,446 |
11.46% |
*The women-owned firm is also a certified minority-owned firm. The amounts shown in each category are unduplicated (i.e., not reflected in both categories).
End of Year Summary: The OAG did not meet the statutory aspirational goals for contracting with minority-owned firms but far exceeded its aspirational goals for contracting with women-owned firms. During FY21, there were no PBE firms currently certified by CMS in purchasing codes relevant to our audit program that advertise government auditing services. Although we met our aspirational goals for women-owned contractors in FY21, and the contracting firm is also a minority women-owned firm, our program continues to rely heavily upon a few minority-owned and women-owned firms. During FY22, we will continue our efforts to identify and solicit participation in our audit program by additional minority-owned and women-owned firms.