The Office of the Comptroller of Puerto Rico issued a qualified opinion of the fiscal operations of the Bayamón Regional Education Office of the Department of Education. A qualified opinion is issued when the noncompliances, individually or in the aggregate, are significant but not pervasive.
The Report reveals that from 2018 to 2019, the Bayamón Regional Education Office (OREB) did not carry out formal auctions to provide the essential school transportation service, but rather awarded emergency contracts under the pretext that it did not have a defined budget due to Act 3-2017, to Address the Economic, Fiscal and Budgetary Crisis. For this period, 453 emergency school transportation contracts were awarded for $77,722,322.
However, the Department had a budget to enter into emergency contracts every six months, and the Audit Report 2019-01 issued by the Internal Audit Office concluded that the emergency contracts method was not the correct way to control such costs. This situation was referred to the Department of Justice on July 23, 2021 so that it may take the appropriate measures.
The four-finding audit notes that from 2015 to 2020, OREB awarded 162 contracts for $53,342,246 to two corporations whose president was the same person, with knowledge at the central level of the Department that both companies belonged to the same owner. This figure represented 34% of all the contracts awarded.
In addition, contrary to the regulations, OREB awarded contracts to a corporation that did not have a fleet of vehicles to provide the service and whose drivers were not registered in the corporation's name, nor did they appear as employees. Although the contracting was carried out through emergency contracts, this does not mean that the requirements inherent to qualification are bypassed. This situation was also referred to the consideration of the Department of Justice on July 23, 2021.
The Report reveals multiple deficiencies with tax withholdings not made at the source or withheld incorrectly. For example, one of the carriers was not withheld 7%, that is, $1,140,394, of the $16,291,353 disbursed between 2016 and 2018.
From 2018 to 2019, OREB filed 159 contracts and two amendments up to 11 months later in the Contract Registry of the Office of the Comptroller. This situation caused payments of $12,503,233 to be made before the contracts had been submitted to the Registry, and contrary, among others, to the second clause of the contracts which establishes that no disbursements will be made until the contract has been duly registered with the Office of the Comptroller, as required under Act No. 18. OREB is directed by a regional superintendent and provides services to 114 schools in the towns of Bayamón, Cataño, Corozal, Morovis, Naranjito, Orocovis, Toa Alta and Toa Baja.
See Audit Report DA-23-17.
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