Audit: State has wasted millions on unused phones

TRENTON - New Jersey's government has wasted millions of dollars because of unused phone lines, a state audit released Wednesday concluded.

The comptroller audit said more than 19,000 phone lines, or nearly one in six in 2009, should be disconnected because they go unused or are no longer needed. In addition, some telecommunications contracts have been renewed without the competitive bidding required by law, the audit said.

"The state is paying hundreds of thousands of dollars every month for phone lines that are not even being used," Comptroller Matthew Boxer said. "Examples of government waste don't get much clearer than that."

Responding to the findings, state departments disconnected or suspended each of the phone or data lines at an overall yearly savings of more than $3.5 million.

Waste found by auditors included state payment for an employee's wireless line for almost six years after her resignation. They also found:

In one year, the state paid more than $250,000 in directory assistance fees when toll-free assistance was available.

The state is owed more than $43,000 because it continued to be billed for data lines disconnected in 2008 and 2009.

Many departments were not documenting the justification for paying for wireless devices for employees; about 19,000 devices - cell phones, BlackBerrys, and air cards - are assigned to executive branch employees.

Adel Ebeid, the state's chief technology officer, said keeping track of unused lines was more difficult than it seemed.

"Unfortunately, we have no way of knowing which agency personnel are being hired, transferred, or terminated, which is why the current policy places the notification responsibility with the individual designated by an agency to coordinate and manage their respective telecommunication services," Ebeid wrote.

He said he had asked human-resource managers to get involved with issuing and terminating phone lines because they are familiar with the employment statuses.

Ebeid also said memos in previous years had asked state employees to stop using pay-per-use directory assistance. He said he had asked Verizon Wireless to block 411 directory assistance calls from all of New Jersey's state-issued phones.

Auditors also found that the four contracts they reviewed had been extended at least seven times without competitive bidding; one was extended 22 times. "The state has prevented fair vendor competition in its telecommunications contracts for more than a decade and essentially handed out a no-bid contract with each extension," Boxer said.

Ebeid said contract extensions had been sought only after significant discounts were offered. As a result, he said, the state pays $12 million less than it did in 2007.

The comptroller's report suggested that telephone coordinators in departments be required to periodically justify the need for all land lines not being used, review zero-usage reports and justify the need for those lines, and better monitor bills to make sure the state is not being billed for disconnected lines.