A new follow-up audit says Denver still doesn’t adequately verify businesses, leaving it at risk of contracting with unqualified or ineligible businesses for large construction projects.

In January 2024, auditors reviewed the city’s construction contractor prequalification process and found that the methods for assigning and communicating construction contractors’ financial limits lack transparency.

Denver’s City Charter empowers the Department of Transportation and Infrastructure and Denver International Airport to manage and control all city construction projects.

Both DOTI and DEN agreed to implement all five of the auditors’ recommendations in 2024.

Still, a follow-up in November 2025 revealed that only two recommendations were fully implemented, one was partially implemented, and two were not implemented at all.

Construction contracts can only be awarded to responsive and qualified bidders. To meet the requirement, the city has adopted formal, written rules and a process for prequalifying contractors.

The rules ensure contractors who bid on major construction projects have the relevant experience, skills and financial resources to perform the type and size of work needed for multimillion dollar projects, auditors said on Thursday during a meeting of the Independent Audit Committee.

Prequalification applications are reviewed by a board of city employees, jointly appointed by executives from DOTI and DIA.

The board reviews each contractor’s experience, qualifications, and financial capability to determine which categories of work and financial levels the contractor may be considered for.

Since the original audit, DOTI has updated the contractor prequalification application template, requiring applicants to disclose whether they are in arrears or in default on any city obligation, auditors said.

However, the application has not yet been integrated into the city’s software, meaning the board may not be receiving accurate data on applicants and thereby risk hiring ineligible contractors.

“Hiring a construction company that’s not qualified to do the work violates the City Charter,” City Auditor Timothy O’Brien said in a statement. “The city selecting unqualified businesses over businesses that are qualified also sets unfair selection process.”

Although DOTI and the airport partially implemented a recommendation to improve transparency when determining contractors’ qualification statuses, Senior Auditor Sarah El Boukili noted that because neither agency is “consistently following processes to provide justification for all approved or financial levels, the risk remains.”

Furthermore, when the board rejects a contractor’s application, auditors recommended that the agencies establish a formal dispute process. DOTI did not implement this process, citing a lack of capacity or staffing.

Auditors complimented the agencies on their efforts to implement the recommended changes since the original audit.

Although the Department of Transportation and Infrastructure and Denver International Airport have made notable progress, they did not fully address all the risks associated with the original findings, O’Brien said in a statement.

“Consequently, we may revisit these risk areas in future audits to ensure the city takes appropriate corrective action.”