Parks contests audit findings

Parks agreed to implement only some of the Comptroller’s 22 recommendations. The City’s Department of Parks and Recreation solicits and awards concessions to operate golf courses, tennis courts, restaurants, and food carts on City parkland. Parks oversees about 500 concessions, and generally follows the competitive sealed bids and competitive sealed proposals processes. Revenue from these concessions equal more than half of Parks’ budget for Parks programs and services. Concession revenues in Fiscal Years 2008, 2009, and 2010 were $52.6 million, $46.1 million, and $39.8 million, respectively. 

The Comptroller audited Parks’ controls over the awarding of concessions, and found that Parks did not ensure that concessions continuously operated, which resulted in lost revenue of $6.9 million. Parks had also failed to issue solicitations far enough in advance of existing contract expiration dates, and had failed to track the solicitation and award process to ensure timeliness.

The audit pointed out that the solicitation and award process took 10.7 months on average to complete, but that Parks allowed itself only 2.5 months on average. The audit also found that Parks improperly rejected bids and proposals, which cost $1.9 million in lost revenue. Under the applicable rules, Parks must award concessions to the highest rated, responsive, and responsible bidders and proposers, unless Parks determines an award would not be in the City’s best interest. Auditors discovered that Parks rejected all bids and proposals for eleven concession solicitations without the required written justification. Parks vigorously defended its management of concessions, particularly with well-known establishments such as Tavern on the Green, Central Park Tennis Courts, and the 79th Street Boat Basin Cafe. It disputed the lost revenue totals, delays, and inadequate justifications of the Comptroller’s 22 recommendations.

Parks agreed to implement only some of the recommendations, but did acknowledge that a significant portion of its concession portfolio should have been awarded in a more time-effective manner.

Audit Report on the Department of Parks and Recreation’s Controls over the Awarding of Concessions, FK10- 129A, NYC Comptroller John C. Liu (Dec. 5, 2011).

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