Audit: State needs eBay-style auctions for surplus goods

Posted November 13, 2013

— North Carolina is losing money by using sealed-bid auctions to dispose of surplus materials and should look into holding eBay-style auctions to create bidding wars to generate more revenue, according to a state audit released Wednesday.

The audit of the Department of Administration's financial operations also recommended tighter security for surplus property and auto parts for the state motor fleet and better monitoring of vehicle maintenance costs.

The Division of Surplus Property generated $12 million in the fiscal year ended in June through sales of goods no longer needed by state agencies. The division sells anything valued at more than $200 through sealed-bid auctions, while anything that costs less than $200 is sold through a state-owned retail store.

Auditors compared vehicles sold by the state with similar vehicles sold on eBay and found the online sales prices were an average 23 percent higher. The audit also noted that the Division of Surplus Property did a similar comparison in 2011 on a variety of goods sold and found profits were 10 to 50 percent higher on eBay.

Division officials told auditors that a consultant would need to be hired to help modernize the agency's bidding software or to hire an outside auction site but that the process could start early next year.

Auditors also said security should be upgraded at the surplus property warehouse – recommendations were provided privately and weren't outlined in the audit – and that people with access to the warehouse shouldn't have access to the database of property to prevent someone from covering up a theft. Division officials said they were working on both recommendations.

The Division of Motor Fleet Management also is trying to limit the number of people with access to its database of auto parts for state vehicles to deter thefts, according to the audit.

The division also agreed with auditors' recommendation to monitor repairs on state vehicles performed by private mechanics to ensure costs are reasonable. Staff accountants plan to pull 10 invoices a day at random to review whether necessary services are being done and whether costs are in line with state estimates.


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  • jonesmw Nov 18, 2013

    That's part of the problem with state government. They don't need an "ebay-style" auction system. Put the stuff on ebay and be done with it. No need to reinvent the wheel. Hopefully we'll avoid this becoming another boondoggle with millions of dollars in salaries and software and hardware purchases for something that already exists.

  • Rebelyell55 Nov 18, 2013

    They maybe right about the security, but way off on thinking they'll get more money in an Ebay type auction. It would also take years to get back the money the state pay for some type of software and I would for see additional employees needed to run it. I think what they do now works. They also do not straight cash sell stuff valued lessed than $200.00. Don't know where the reporter got that info. I've seen stuff sell for just a few dollars under retail. (don't know why, they could bought it new and had a warranty too for a few more dollars.)as well as stuff selling over retail. Most time ya get a pretty good deal, the danger of getting junk is from the electronics and vehicles, since there is no way of testing if they work or not. You can crank a car, but it can't be driven. Most don't crank because battery dead or out of gas.

  • cruzinlong Nov 15, 2013

    Ebay gets 10% on final value fees, then 10% on the shipping charges then 2.9% + 30 cents on top of that per those very same 2 areas at paypal.
    They double dip big time , not sure how they can do it legally but they do.
    However, if you become a power seller you get a bit of a price break on some fees but don't think it's that great.
    Personally I thought NC already had been selling surplus on ebay, know many other states and municipalites are doing the such.

  • LuvLivingInCary Nov 15, 2013

    downtown boy is wrong with his assessment of ebay costs. just look it up. anyway typical government mess…study it for a year, then bid it to the cheapest bidder and then take a year to implement…

    just put it on ebay tomorrow and when the system is ready migrate to the new system. where's the ATT commercial kids to make common sense...

  • common tater Nov 15, 2013

    Disagree with some of this. I've bid on a few cars, only to find out later they sold for well above edmunds.com retail value... I highly doubt the average car on ebay sells that high. Also there are lots of state surplus items under $200 that sell via sealed bid. Would like to see an ebay-style autcion though, so I don't waste time and money going to the warehouse to check out stuff that sells at above retail value. I've also seen stuff sell for pennies over what I bid (end sale price is posted after the end of bidding)...so I have wondered if there wasn't some insider info given out. The problem is any software done by the govt. is very expensive and seldom works well. I do agree with the security recommendations.

  • dwntwnboy2 Nov 14, 2013

    What they fail to mention is that online, Ebay takes 20% of the price from the seller. So that "increase" really only covers the cost of the internet supplier. Now if they wanted to create their OWN auction type site, then the money would (after costs to create and run and man the site) be the State's to do with as it pleases. Ebay SOUNDS good, until you see how much they get, how much Paypal gets etc.

  • jackjones2nc Nov 14, 2013

    Maybe Aldona Wos can hire some special consultants to investigate? She seems to have a huge "special favors" fund for friends.

  • bgrmom Nov 14, 2013

    What a concept! Oh, but wait, couldn't they just use eBay without re-inventing the wheel by creating new software for bidding. Oh, and some agencies already use eBay for some of their stuff. Geez. When will state government come into the 21st century!?