You Didn’t Approve the Work — Or Did You? How Vendor Actions Before Formal Approval Can Create Risk

How Informal Conversations, Emails, and Silence Can Create Unexpected Financial Risk for Public Agencies

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In public agencies, getting things done often requires balancing urgency with proper procedures. When timelines are tight, it can be tempting to move forward with a vendor through a quick conversation, an email exchange, or an informal understanding before formal approvals are complete.

While this may feel like a practical way to keep projects moving, it can create unexpected risks for both the agency and its employees. A vendor who begins work or incurs expenses before the required approvals are in place may create a situation where questions arise about who authorized the work and who is responsible for the costs.

The Hidden Risks of Vendor Work Before Approval

A common scenario begins with good intentions. A vendor understands the urgency of a project and decides to start work or spend money before the formal approval process is complete.

Without proper precautions, this can create complications. If the person requesting or encouraging the work did not have the legal authority to authorize it, and approval is later denied, the costs associated with that work may become a serious concern.

What appeared to be a proactive step can quickly turn into an unexpected financial risk.

Silence or Informal Communication Can Be Misinterpreted

Many authorization issues do not begin with a formal agreement. They can develop through simple conversations, emails, or a lack of response.

If a vendor moves forward without explicit authorization and you become aware of their actions, failing to communicate the risks they are taking may unintentionally create the impression that their actions are acceptable.

Even a verbal acknowledgment, a thank-you, or silence in response to a vendor moving ahead can potentially be misunderstood. This is often not recognized as a problem until costs have already been incurred.

Protecting Your Agency Through Clear Written Communication

The best way to reduce these risks is to communicate expectations clearly and in writing.

When a vendor begins taking action before formal approval or a contract is in place, clearly state that any work performed or expenses incurred before approval are being done entirely at the vendor’s own risk.

If the work involves being onsite, specifically communicate that no onsite work can take place until the agreement has been formalized by someone with the legal authority to do so.

Clear written communication helps establish expectations and provides a record that protects both the agency and its employees.

Balancing Urgency With Responsibility

Public agencies often face pressure to move quickly, but speed should be balanced with the responsibility to follow proper approval processes.

By communicating clearly with vendors and setting expectations before work begins, agencies can reduce the risk of accidental authorization and avoid unexpected financial obligations.

Taking a proactive approach protects both the agency and the employees involved while creating a clearer path for vendors to understand when work can officially move forward.

If this article sparked ideas relevant to your work in a California public agency, you may find value in our free Purchasing & Public Works Group, where professionals share practical experiences and lessons learned.

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