State auditor criticizes Port of Bellingham over contract selection process
AI-generated summary reviewed by our newsroom.
- State audit flagged Port of Bellingham for bypassing proper contract evaluation.
- Port awarded $906,006 contract without ranking proposals or scoring firms.
- Port pledged improved internal controls and staff training on federal procurement.
Port of Bellingham officials are being faulted by the state Auditor’s Office for “material weaknesses” in spending funds under a federal contract.
In a report issued last Monday, state Auditor Pat McCarthy said the Port failed to set a ranking system for choosing an architectural and engineering firm to design a project being built under a $4.2 million grant from the Port Infrastructure Development Program.
Port officials hired the Long Beach (Calif.) firm Moffat & Nichol without proper competition last year, according to the report.
“Our audit found the Port’s internal controls were ineffective for ensuring compliance with federal procurement requirements,” the report said. “Specifically, the Port did not follow competitive procurement requirements when selecting an architectural and engineering firm for its federal infrastructure project. The Port solicited proposals via a competitive process; however, the Port awarded a contract to one firm without evaluating the qualifications of either firm that submitted proposals. We consider this deficiency in internal controls to be a material weakness that led to material noncompliance.”
The audit said Port officials “incorrectly concluded that receiving only two proposals meant that competition was inadequate and selected a firm’s proposal without performing a scoring process for either proposal it received.”
Moffatt & Nichol was paid $906,006 from the federal grant, a state Auditor’s Office spokesman told The Bellingham Herald.
“Without effective internal controls over federal procurement requirements, the Port cannot demonstrate it complied with its policy and federal regulations and selected the most qualified firm for architectural and engineering services as required,” the state audit said.
In a written response, the Port said it “takes compliance seriously and has expended significant effort to ensure that all resources are spent effectively and appropriately,” according to the report. “However, the Port will improve its controls over procuring using competitive proposals, including the documentation that demonstrates compliance with federal procurement requirements. The Port will also ensure employees have the proper training on federal procurement requirements.”
Port of Bellingham spokesman Mike Hogan told The Herald that the state’s 2024 finding was an anomaly after nearly 20 years of clean financial examinations.
“Each year the Port receives independent financial audits to evaluate financial statements and ensure compliance with all state and federal requirements. Recently the Port was notified about an issue related to documenting how a consultant was selected to perform work on a federal grant. The Port is committed to following all federal grant contracting requirements and immediately put new protocols in place to address this issue moving forward. The Port had previously not received an audit finding in 18 years and welcomes annual audits to strengthen internal procedures, ensure accuracy and promote transparency,” Hogan said in an email.
In the rest of its 81-page report, the Auditor’s Office found no other problems with the Port’s financial records.
The state Auditor’s Office regularly reviews the financial records of state agencies and local governments to ensure that public funds are used appropriately.
This story was originally published August 4, 2025 at 5:00 AM.
