Governor McCrory's Purchasing Reforms Are Saving Millions For Taxpayers
Published: Tuesday, December 29th, 2015 @ 1:16 pm
By: Stan Deatherage ( More Entries )
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New Measures Are Producing Benefits That Go Beyond the Bottom Line
Raleigh, N.C. Governor Pat McCrory's reform of how the state makes purchases has saved taxpayers tens of millions of dollars. Since last year's implementation, Governor McCrory's purchasing reforms have saved the state $21 million and are expected to save $57 million total over the next three years.
Lower pricing make up most of these savings. Lower prices were offered after the state followed the governor's directive to aggregate common purchases across numerous state agencies.
"By collaborating across cabinet agencies and the community colleges, we've saved North Carolina taxpayers tens of millions of dollars while maintaining a high level of service delivery to citizens," said Governor McCrory. "This effort makes state government more efficient and accountable to the taxpayers."
Additional savings are being earned by renegotiating existing contracts and including the additional volume. Savings from restructured contracts have been 30 percent higher than projected because of expanded usage by K-12 schools, universities, counties, cities and towns.
Motor Fleet Management saved $10 million from state contracts for the purchase of vehicles, fuel, tires and auto parts after it teamed up with the Department of Administration's Purchase & Contract Division and overhauled fleet management's purchasing approach. The department saved $3 million after the number of distinct vehicle models it purchased was reduced by 70 percent. An additional $2.7 million has been identified as potential savings by selling, retiring or repurposing under-utilized vehicles.
Fuel savings of $3.2 million annually is projected after the consolidation of contracts and allowing vendors to sell at a statewide level. The state gave North Carolina-based businesses the opportunity to price-match resulting in portions of the fuel contract going to local businesses in 49 counties.
The purchasing overhaul at Motor Fleet has produced benefits that go beyond dollars and cents.
"The savings identified in Motor Fleet will allow us to improve the overall age and health of the fleet and allow us to upgrade our technology and information systems," said Kathryn Johnston, Department of Administration Deputy Secretary of Operations.
The state's Procurement Transformation Project is supported by Accenture, a leading global professional services company that has worked with the state on various business and technology initiatives for more than two decades.
"North Carolina is setting a new standard for performance with its procurement function," said Department of Administration Secretary Bill Daughtridge. "While honoring good government principles including transparency and open competition, we are more effectively leveraging our buying power and establishing more strategic relationships with vendors selling goods and services to our State."
Contact: Crystal Feldman