Competitive Bidding? — Baloney!

January 22, 2013

Today, Tuesday  January 22, 2013, city council will be considering (ha! when was they last time they did not approve a purchasing item on the agenda?) the approval of two brand new job order contracts (items 11C and 11D).  The city uses these contracts for construction work where they do not want to choose based upon competitive bidding but instead want to cut corners in choosing their favorite contractor.

Each contract is for $1,500,000.   These contracts are different from the ones originating out of Houston that I have been writing about.  They are administered through our own Region 19 Education Service Center.  Evidently the Region 19 cut (% percentage paid by the contractor to Region 19) might stay in El Paso instead of sending our money to Houston.  That would be a good thing.

You remember Region 19  — that is the organization that is supposed to clean up the El Paso Independent School District for us.  The Region 19 web site is far less open than the City of El Paso web site.  If you poke around long enough you can find the results.  They are tucked away under “National Job Order Contracting Services.  Evidently Region 19 wants a piece of the national construction business.  You can read the award summary here: Region19joborder13-6901sum (2)

My problems with this start with the Request For Proposals that Region 19 issued.

  • The pricing is based on a percentage of the price published in a price survey, not based upon market conditions today.  The contractor indicates that it will charge X% (lets say 90%) of the price published in the book.
  • Evidently 18 contractors responded.  According to the award summary “One proposal received was not in accordance with the scope of Job Order Contracting and was not considered”  In other words they awarded the contract to 17 different firms!
  • How can they award a contract to virtually everyone who bid?  Why would they do that?  Maybe because Region 19 will get a cut of anything awarded.  Maybe Region 19 was not looking for competent low cost construction but instead at a revenue stream from other government agencies.  Maybe this was not bidding at all.

Did all 17 firms bid the same prices?

  • If they did we have a serious price fixing issue going on here
  • If not, how can this be competitive?  Some must be lower than others.  A competitive bid would award the contract to the lowest cost qualified bidder.  Why did 17 out of 18 firms get awarded contracts?

Also interesting is that

  • The firm that the city has been issuing these contracts to (most recently $4 million for work on the buildings that the city plans to move into after they have demolished city hall, see Minimal due to condition of building) was awarded one of the contracts by Region 19
  • Now that the city has another buy board to use they are not choosing their old firm any more, they are choosing two different firms
  • If the original firm was the best choice why are they not being chosen again?  If the city had used real competitive bidding would they have chosen one of these two firms instead of the one that they have been doing business with?  Is this “spread the wealth” instead of choosing the best firm?

I have not been able to look at the responses from the individual firms.  That will have to come later.

In the meantime rest assured that this is just another ruse to avoid doing the real work involved in competitive bidding.

Why does the city even have a purchasing department?  They seem to let city staff chose their favorites anyway.

Now the city can spend another $3 million of our money without telling us what it is for, and they get to pick their contractor to boot.

We deserve better

Brutus

2 Comments | City government, El Paso Independent School District, Purchasing | Permalink
Posted by Brutus

Do they even think about what they are doing?

January 21, 2013

Today’s (January 21, 2013) El Paso Times has an article “Public input needed for charter changes”.  It addresses some of the issues that the city’s Ad Hoc Charter Advisory Committee is considering.  The plan is to have some public meetings and then take their recommendations to city council.  City council will then decide what to put on the May 2013 ballot for approval or rejection by the voters.  According to the article “council has the final say on what to take to voters”.

Cato wrote about the issue in Charter Changes?

According to the city web site one of the purposes of the committee is “making revisions that (1) are appropriate to the Council-Manager form of government …”.

Huh?  How about “proposing revisions to our form of government”?  Why must they be appropriate to the Council-Manager form of government?  Well, they tried limiting a similar group back in Philadelphia a couple of hundred years ago.  Maybe this new group will try to stretch beyond the limits that our local cabal is trying to impose on them.

Go to a meeting.  Express your thoughts about the mess we have.  This is your chance.

The article even indicates you can contribute by sending an email to citymanager@elpasotexas.gov.

Give me a break!  The city manager?  Is that like asking Caesar if he still wants to be emperor?  My namesake (or tocayo locally) took care of that himself.

Would the city manager not be fair and forward all emails?  It does not make any difference.  The city manager should not be involved in the process.

Why can’t the public send in their thoughts to the committee directly?

We deserve better

Brutus

Leave a Comment » | City government, El Paso Times, Open Government | Permalink
Posted by Brutus

liberal

January 20, 2013

The term liberal has been hijacked in the United States.  In virtually every part of the world the term “liberal” refers to what is now called a “classic liberal” in the United States.  We have it backward now.

Classically it referred to a belief in limited government, political freedom, civil and economic freedom, and the rule of law. We refer to this today as the “right” in the political spectrum.

Today it seems to imply a vigorous government that acts to control the economy, redistribute wealth, and actively manage inequalities. Today this is the “left” politically.

So why the change from “right” to “left”? Liberal sounds giving, it is nice. Conservative sounds stingy, we think of that as bad.

None other than the republican Theodore Roosevelt started the shift when he branded his opponent William Howard Taft as being “too conservative” while he was “liberal” enough to lead the nation.

Stealing the term also provided confusion for the electorate. The value of that is obvious.

The price of liberty is eternal vigilance.

Cato

Leave a Comment » | City government, County Government, Federal Government, State Government | Permalink
Posted by Cato

Favoritism

January 19, 2013

Here are some specifics about the buy-board contracting that the City of El Paso has been involved in lately.

You will recall that they recently issued a $4 million dollar contract through a Houston based purchasing organization.  This money looks like it is going to be used to remodel the building the city is going to move into.

Some at the city claim that it was competitive bidding:

Decide for yourself:

  • The request for proposals (RFP) was what is commonly called a “beauty contest”.  The evaluation criteria used gave points to each bidder for such things as the bidder’s references (15%), reputation (10%), ability (35%), ownership (underutilized businesses could get 5%), and price (25%).  References and reputation add up to 25% and sound like the same thing to me.  Ability must have been judged subjectively.  With those subjective judgments we are at 60% of the evaluation and it comes down to who looks prettier to the judge.  10% was awarded for something called “Value Add”, whatever that is.  I would think that “Value Add” is in the eye of the beholder.
  • The bidder;s price only accounted for 25% of the evaluation factors.  Price is 25% — how can that be a bid?
  • Pricing was based on what portion the bidder would charge of a nationally published price estimating book (the Oxford Dictionaries define estimate as “roughly calculate or judge the value”).  The book does not reflect current market conditions, it lists historical values that are gathered from survey respondents, in other words what something used to cost on average.   The prices do not reflect current market conditions in El Paso.  When times are tough construction prices go down after all.  Bidding is supposed to use market price to determine the lowest offer.

There are several buy boards in Texas that offer these kinds of contracts.  The city only uses the Houston based one for this work.  The board charges 4% for its services while other buy-boards charge less.

The company that the city chooses each time from this buy-board is only one of twenty or so eligible contractors that are listed for this area.  Other contractors are available.  Why does the city only choose this one?

Staff at the City of El Paso claims that this purchasing method saves time because detailed specifications do not have to be drawn up.  For $4 million dollars, why not?  The point is moot however.  The $648 thousand the city awarded the other day had plans drawn up by an architectural firm.  The $694 thousand they spent with this same firm for a new roof for our soon to be destroyed city hall had plans drawn by an architectural firm.  If the city has plans, why not take it to bid?  You can’t tell me that the city did not know about this need a month ago.  After you advertise for the legally required two weeks and perform your evaluation you can process a bid in one month.  That is tight, but it can be done and done fairly.

The sad fact is that this is favoritism.

  • Other buy-boards that are less expensive are available
  • Other firms are available — even on this buy board
  • The city keeps choosing the same firm from a field of many qualified firms

We deserve better

2 Comments | City government, Purchasing, State Government | Permalink
Posted by Brutus

The laws are for citizens, not city employees.

January 18, 2013

This was posted anonymously.

—————————————

On the way to work today, I drove a couple of miles down Mesa next to a bright, shiny City of El Paso Code Enforcement pick-up truck.

The guy was slouched against the window, talking on his phone the entire way.  Clearly not a business call and total disregard for the no-talking-while-driving (without a hands-free device) ordinance.

But here’s the punch line…that’s the second time I’ve seen him just driving around talking on his phone.

Great work if you can get it.

Every time I see those trucks I think they are police trucks because of the way they are painted and the light racks on top. That’s why I pay attention to them.

I pulled up right beside him, rolled down my window, and actually honked at him three times, trying to get his attention. He was totally oblivious. I was going to tell him to obey the law and get off his [deleted] phone even if it cost me a ticket. Then I was going to actually go to court and to the media and explain how I got the ticket.

 

Leave a Comment » | City government, Personal Experiences With Government | Permalink
Posted by Brutus

« Previous Entries
Next Entries »