Springfield audit finds contract gaps, missing payments and liability risks in Sodexo school food program

The Springfield City audit subcommittee heard on Feb. 5 that an internal review of the school district’s food service contract with Sodexo turned up multiple high‑risk compliance gaps that officials say the district will address before the contract is rebid this summer.

Mister Ngo of the Office of Internal Audit told councilors the audit focused on contractual compliance and found ambiguity in how the management fee is defined and billed. "The contract is not clear," Ngo said, describing a potential overlap between a corporate management fee and local Sodexo staff salaries that the district also reimburses. He said the locally paid positions cost about $489,000 a year and recommended clarifying the RFP so the district is not effectively paying twice for the same functions.

Why it matters: the contract covers major program operations — the district reported roughly $35 million in reimbursements for FY24 and the FY25 contract value was about $30 million, with a roughly $1.5 million management fee. Councilors said clearer language is needed before the contract expires on June 30, 2026.

The audit also found Sodexo failed to deliver a promised $300,000 contribution to the Culinary Nutrition Center over five years. Pat Roche and other school staff told the committee Sodexo has acknowledged the missed payments and is in the process of returning the funds; the district said the money will be used for culinary center equipment replacement.

Ngo reported a separate calculation error in the management‑fee formula that resulted in an overcharge of roughly $50,000 across several years. School officials said they have recovered about $38,000 and that amount will be returned to the food service revolving account.

The audit documented other operational and legal risks. Auditor testimony said Sodexo had been using city‑owned vehicles for program deliveries despite contractual language obligating the vendor to provide transportation; FY25 maintenance and fuel for those vehicles amounted to about $23,000. Ngo also flagged insurance documentation shortfalls: Sodexo’s certificate showed $8 million in umbrella coverage where the contract required $10 million and did not list the city as an additional insured, which the auditor said could reduce the district’s recoverable claim in a worst‑case incident.

Safety procedures were another concern. The audit found gaps in CORI (background) check processes. The contract requires Sodexo to conduct quarterly CORI checks for staff with unmonitored contact with students, but the district had been performing checks and notifying Sodexo only of failures. "If those checks slip through the cracks, someone who should have failed could continue to be on school grounds," Ngo said; he recommended the contract be enforced and reconciled so the district and vendor are in sync.

Councilors pressed for more detail on how the management fee is calculated and asked the auditor and school staff to provide a breakdown showing what was charged through the fee and what was paid as local salaries. Councilor Govan also raised concerns about food waste under the current service model; Tim Gray, the district’s food service administrator, said the program must follow federal and state meal pattern rules and is routinely audited by the USDA and state education authorities.

Liz Ogilby of the Springfield Food Policy Council, who attended the meeting, warned that the findings could put the district’s Community Eligibility Provision and federal reimbursements at risk if federal reviewers take issue. She urged the council and school committee to ensure procurement is competitive when the RFP is issued and to prioritize local and equitable sourcing in future contracts.

School officials told the committee they will amend contract language in the upcoming RFP to clarify the division of responsibilities, insurance and vehicle use. The audit report and a follow‑up meeting on the item were requested by councilors for further review; the auditor said the office will present the final report to the full council after the committee presentation.

The audit subcommittee scheduled additional review and the chair said he will call another meeting next week to continue the discussion. The committee adjourned at the close of the session.