New York State Office of the Inspector General

06/03/2025 | Press release | Archived content

New York State Inspector General Report Identifies Oversight Gaps...

ALBANY, NY - Earlier today, New York State Inspector General Lucy Lang released a comprehensive report evaluating the New York State Division of the Budget's (DOB) management of various consulting projects undertaken by the Boston Consulting Group (BCG) to assist the Department of Motor Vehicles (DMV) in its post-COVID-19 reopening and technology transformation efforts.

The investigation, which covered projects conducted from August 2020 to August 2021, at a cost in excess of $15 million, revealed deficiencies in oversight, lack of proper engagement with DMV on scope and deliverables, and procedural deficiencies in project management, including a failure to finalize Statements of Work (SOWs) prior to the commencement of work. Overall, the report highlights the need for improved contract management practices within DOB to ensure effective oversight and collaboration where a client agency utilizes a contract held by DOB.

"Best intentions cannot be a substitute for best practices," said New York State Inspector General Lucy Lang. "This report underscores the importance of clear interagency communication and defined roles when public funds are at stake."

As detailed in the report, in August 2020, DOB, at the direction of the Executive Chamber, sought to assist DMV with reopening its COVID-shuttered doors by utilizing a pre-existing DOB contract with BCG. Under this arrangement, BCG was to provide strategy and guidance to DMV on a series of projects, but DMV would not hold or manage the contract. Instead, DOB itself managed the contract and projects, but did so without adequately communicating with DMV about its needs, the scopes of work to be performed, and project expectations. Moreover, DOB failed to collaborate effectively with DMV to provide oversight of BCG and ensure complete and timely deliverables. DOB also permitted work to commence prior to the finalizing of a SOW for each project, leading to later confusion.

Additionally, lack of communication between DOB and DMV regarding funding sources resulted in DMV being billed for projects initially thought to be covered by other non-agency funding sources. Ultimately, following the completion of the third of five scheduled projects, DMV elected to end its relationship with BCG.

In the report, the Inspector General made three recommendations to DOB to ensure sufficient and effective contract oversight in future instances where another state agency utilizes a contract held by DOB:

  • Designate a Liaison: DOB should designate a staff member to serve as the point of contact between DOB and the agency having work performed under DOB's contract and ensure that this person is aware of and properly trained on their responsibilities, including the expectation that they will include the agency in the development of SOWs and review of deliverables.
  • Strengthen Statement of Work (SOW) Policies: Require that SOWs be developed and executed at the outset of projects, prior to the commencement of any work.
  • Identify Funding Responsibility: Communicate at the outset of a project to the agency having work performed under a DOB contract if the agency may ultimately be responsible for financing the work from its own budget.

The Inspector General thanked members of her team for their work on this investigation and today's report, including Investigative Counsel Ray Gdula, Senior Investigator Ilene Gates, Deputy Inspector General for the New York City Region Ken Michaels, Senior Investigative Counsel & Director of Report Writing Jonathan Masters, Deputy Chief of Investigations Gary Waters, Manager of Digital Forensics Bobby Payne, and Chief Deputy Inspector General Michele Bayer. The Inspector General also expressed her appreciation to the DOB and DMV for their partnership in investigating this matter and their shared commitment to addressing the issues detailed within today's report.

Read OIG's complete report and follow the office's work @NewYorkStateIG.

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The Offices of the New York State Inspector General: Fostering confidence in New York State government by promoting integrity and transparency through oversight of covered agencies, their employees, and those doing business with the State.

To report wrongdoing, call 1-800-DO-RIGHT (367-4448) or visit ig.ny.gov.
Follow the office's work on social media at @NewYorkStateIG.

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