RALEIGH, N.C. -- A new report released by State Auditor Beth Wood's office shows problems in the ABC Commission with their warehouse contract.
"All this money eventually trickles down. It goes from that state commission, to the local boards, and eventually ends up in the pricing of liquor that consumers purchase," said Wood.
In their almost one year audit they had three main findings.
- Poor contract administration cost the State at least $11.3 million over 13 years
- Unused warehouse space potentially cost the State $2.1 million over 7 years
- No monitoring left the State underpaid by at least $297,537 over two years
Wood says the vendor LB&B would ask for yearly increases to the contract for reasons like gas prices going up.
"So the contract was written that you could give price increases to the contract, but there were caps that were put into the contract and nobody went to see, nobody checked the contract and looked at the ask for the price increase to make sure it didn't exceed. It was just poor contract monitoring."
Interim ABC Commission Administrator Agnes Stevens says, "the ABC Commission has increased its focus on tighter controls so that today a plan is in place and the Commission’s Audit staff is conducting unannounced, random checks of the contractor’s operations."
The contract for warehouse services expires in 2021, they plan to look for bidders in 2020.