State hiring of contractors jumps 26%, but UW goes opposite way

By Andy Hall
Wisconsin Center for Investigative Journalism

State agencies’ hiring of outside contractors surged last year, according to a report quietly released by the state Department of Administration.

The annual report, posted Monday on the DOA’s website, shows that state agencies spent $363.8 million on private contractors — an increase of 26 percent compared to the previous fiscal year.

In contrast, the University of Wisconsin System’s hiring of contractors decreased 2 percent during the same period, to $125 million.

Overall, combined spending on contractors by state agencies and the UW System increased by 17 percent, to $488.9 million.

Officials couldn’t immediately be reached for comment late Tuesday.

The report, available at http://tinyurl.com/doacontractors, was released more than eight months late. Wisconsin state statute 16.705(8) requires the DOA to file a report by Oct. 15 of each year regarding the hiring of outside contractors to perform services for state agencies.

Public employee unions and others scrutinize these mandatory filings, known as Contractual Service Purchasing Reports, to find wasteful spending and track trends in the hiring of outside contractors.

A review of the reports for fiscal years 2006 through 2011 shows spending on these services has been substantial, ranging from $417 million to $490 million annually.

On June 26, the Wisconsin Center for Investigative Journalism reported that the DOA wasn’t responding to inquiries from the Center, state Democratic lawmakers and union officials.

The next day, DOA spokeswoman Jocelyn Webster sent an email to the Center saying “the UW was late in turning their submission for this report and DOA did not receive it until May 2012, which delayed the report.”

The report notes that on contracts worth more than $25,000, agencies are required to prepare cost-benefit analyses to determine whether services are appropriate for contracting. Last year, 355 such analyses were prepared.

Several specialized services — such as banking, maintenance of proprietary software and handling of hazardous waste — must be performed by contractors because of legal restrictions or because the state lacks the expertise, the report says.

About 42 percent of all cost-benefit analyses involved technology services, the report says. Other common areas of work included health, environmental and social services.

The nonprofit and nonpartisan Wisconsin Center for  Investigative Journalism (www.WisconsinWatch.org) collaborates with Wisconsin Public Radio, Wisconsin Public Television, other news media and the UW-Madison School of Journalism and Mass Communication. All works created, published, posted or disseminated by the Center do not necessarily reflect the views or opinions of UW-Madison or any of its affiliates.

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