State governmental agencies are getting a $4 million windfall in the next few months from a settlement that requires Ricoh Americas Corp. to repay them for overcharges on copier services provided since 2007.
But state agencies, cities and others might have to wait to see any cash.
The settlement is based on a sampling of contract sales by an independent auditor – in response to an anonymous complaint to the state attorney general in 2009. The settlement, announced Friday by the state Department of Enterprise Services, covers overpayments to Ricoh subsidiary IKON Office Solutions that date to 2007.
DES spokesman Steve Valandra said Ricoh “inherited the issue” after purchasing IKON in 2008.
“Once they were made aware of it, they took care of it,” Valandra said, explaining that companies have an opportunity to “cure the ill” before the state acts against a contract.
Ricoh has a $17 million per-year contract with the state for supply of copiers and service that expires in April. The company had paid for the review of charges by PricewaterhouseCoopers LLP after the issues were raised to the attorney general.
In a joint news release from Ricoh USA and the state agency, Ricoh’s national director of state and local government sales, Steve Bissey, said they felt “confident that we have taken the steps necessary to provide greater transparency to our sales and invoicing procedures in the future.”
A spokeswoman for the company in Pennsylvania declined to comment further.
The money from the settlement ultimately goes back to state agencies and local governments that participated in the state’s contract for copier services and were overcharged.
“What we will do over the next few months is see what agencies and local governments used the contract and how they were affected – and direct the money back to them,” Valandra said.
Enterprise Services director Joyce Turner said in a news release that the negotiations and process that led to settlement “provide a model for government and industry working together to ensure that the taxpayers of Washington are best served.”
The settlement comes as DES continues to change the way it procures goods and services for agencies from the private sector. In April, DES issued a new contract for purchasing office supplies, which is estimated to save 21 percent, or $2.9 million a year. The contract split the supplier role in two – letting Office Depot supply paper and office supplies and Office Pal supply ink products and toner.
Lawmakers have passed a law, House Bill 2452, to consolidate state purchasing even further through DES and to subject contractors to greater scrutiny. It includes penalties for misconduct that include barring a firm from state firstname.lastname@example.org 360-753-1688