County contract system broken


Multnomah County taxpayers can expect millions of their hard-earned dollars to continue to be wasted unless Chairman Ted Wheeler has a greater ability than his predecessors to force changes in the county's management culture and oversight procedures.

Taxpayers also should anticipate plenty more human-services scandals - such as the one that has engulfed Cascadia Behavioral Healthcare. Those two conclusions are inescapable after reading a July 7 audit released by county Auditor LaVonne Griffin-Valade. Griffin-Valade and her staff amply demonstrate that oversight of county contracts with outside vendors is weak, that procurement requirements are routinely circumvented and that past efforts to improve monitoring of contracts have been utter failures.

The contracting issue is hot now because of the implosion of Cascadia, which held about $18 million in contracts with Multnomah County to provide mental-health services. Cascadia is being forced to reorganize and downsize due to financial problems.

The state and the county already have stepped in with a $2.5 million bailout, and the county is scrambling to find other mental-health providers to take over some of Cascadia's contracts.

Cascadia just one example

The Cascadia situation would be a serious sign of the county's past incompetence in managing contracts even if it were an isolated case. But it is not. As Griffin-Valade's audit makes clear, county officials have known for years that contracts were being awarded with inadequate process upfront and unsatisfactory monitoring afterward.

This poor system for overseeing contracts invites financial abuse and also leaves the county clueless that a major service provider such as Cascadia is about to hit the rocks. And let's not forget, the people who suffer when a human-services vendor cannot fulfill its obligations aren't the bureaucrats who awarded the contract, but the county residents who are in dire need of services.

The county's lousy management of its contracts is a testament to bureaucratic inertia and poor decision-making. Past efforts to improve contract monitoring have collided with the stronger wills of elected officials or managers who maintain cozy relationships with contractors. And in a misguided move to save money earlier this decade, the county decimated the ranks of its contract administrators - the watchdogs for the pubic interest.

Stronger oversight required

Restoring those administrative positions will be difficult at a time when county revenues are tight. But Wheeler and other county commissioners also must consider that the county could be wasting huge amounts of money on contracts that are going unsupervised by a central authority. Bringing back the contract police could save the county millions more dollars than it would cost.

Those contract administrators also need stronger authority to ensure that private contractors are meeting agreed-upon benchmarks. Such oversight cannot be left to managers of county departments that work directly with contractors. The rationale for using contractors is a sound one. The county can deliver more services to more people if it pays private companies and nonprofits to do what more highly compensated county employees otherwise would have to do.

But that rationale works in the real world only if someone is keeping the contractors honest. Warnings about inadequate contract oversight have been sounded for 16 years. Among all the other unpleasant jobs that Wheeler has tackled since coming into office just 18 months ago, he now has a new one - forcing a cultural change in county government to allow full monitoring of contacts and better protection of taxpayers' interests.