More Of Our Money For Houston

November 30, 2012

Next Tuesday’s City Council agenda has an item to award a 4 million dollar contract for construction work without a real competitive bid.  Read the item here.

I have written about the non-competitive issue before.  You should read Saying It Does Not Make it So.

The company in question put a new roof on city hall last year to the tune of 694 thousand dollars.  Yes, the city hall that they are about to tear down.  Read There They Go Again for the gory details.

Remember that four percent (that is 160,000 dollars) goes to the Harris County Department of Education because the city is buying off of a buy-board!  I would think that we could use the money.

I sense that we may be seeing the old two-step here.  I have no evidence yet, but I suspect that they are up to something more.

Remember that the city has been telling us that it will take about two million dollars to tear down city hall.  That’s the city hall with a new roof, and a new chiller, and a whole bunch of valuable emergency communication equipment that they say will be imploded into the rubble (click here to see $63.9 million and climbing).

Last year the city issued a contract to this same firm for 750,000 dollars.  Why the big jump to four million dollars?

Is it possible that the city will use this new contract to get away with tearing down city hall without a real bid?  There is probably real value in the salvage.   Are they going to claim that they do not have enough time to conduct fair bidding?  How long have then been planning to tear down the building?  Four percent of 2 million dollars is 80,000 dollars.  How much money could we save by conducting  a bid with existing city employees?  How much would it really cost to tear down city hall if we let the market work?  Is there real value in the salvage and are we going to get it or is some contractor going to get it?

So far we have not seen any bidding activity from the city where they are trying to find a contractor to tear it down.  The city says it takes about 60 days to run a Request for Proposals.  Have they decided to use this new contract?  Hide and watch.

Call your city representatives!  Be careful not to tell them what to do.  Incredible as it sounds that appears to be illegal.  Read Cone of Silence by clicking this link.

I wish that we could get the El Paso Times cover these stories.  I know that they have to fight cost issues, but it seems to me that they could bring real value to this situation.

We deserve better.  Maybe we will get it in the next election.

2 Comments | City government, El Paso Times, Purchasing, State Government | Permalink
Posted by jcurrey

Another shameful way to allow favoritism

November 26, 2012

Just when I think I have figured out the extent that our local administrators will go to to circumvent fairness and the law, their wicked (look it up, it means evil or morally wrong) minds come up with another travesty.

The El Paso Independent School District issued a Competitive Sealed Proposal (CSP) #13-106 for iPads, Computer, Telephone and AV (audio visual) parts.  Note the word competitive.   On the face of it I don’t know of too many vendors that sell products  in all of those areas, but maybe the results of the CSP could prove differently.

Twelve vendors responded. That is pretty good until you realize that most of them responded only to a portion of the bid.

What did EPISD do? They awarded the bid to all twelve, even after they found some bidders to be less desirable because of past performance. Preposterous! The stated justification was “to allow the campuses and departments the flexibility to compare and purchase products from several approved vendors based not only on price but availability and lead time” You can see that on the EPISD document here.  The explanation is at the bottom of the last page.

This is not competitive bidding, it is a sham. It allows the administrators to buy from their favorites among the twelve with impunity. By definition it is not competitive. It is however devious.  By awarding the bid to all twelve proposers, no proposer has anything to complain about. Now staff has a blank check to buy from any of the twelve.  Staff is free to pick who they like and eliminate anyone else.

Why does the school board allow this?

The El Paso Times uses a lot of ink writing about the board.  They need to look at the managers and staff in our local governments.

Our children deserve better.

Leave a Comment » | City government, County Government, El Paso Independent School District, El Paso Times, Purchasing | Permalink
Posted by jcurrey

Saying it does not make it so

November 20, 2012

I have been writing a lot about buy boards that our local governments have been using.  Contrary to what some of our local officials are claiming, the contracts on these boards are not competitively bid.  Some may be but most are not.  That of course is my opinion.  Read this post and draw your own conclusion.

The ones I have written about recently are run by government agencies like the State of Texas or the Harris County Department of Education (Houston).  They  let other agencies (like our City and County governments and school districts) buy under their contract without conducting a separate bidding process.

The buy boards do this to make money for themselves.

They do this for a fee that is paid by the vendor.  Some of them charge 4% of the value purchased. The vendor pays the fee to the buy board.  The 4% is a cost of doing business for the vendor.  It makes sense to me that if the vendor did not have to pay the 4% the price that is charged to the buying agency we could buy that much lower.

They pick the brand they want

The buy board goes through the process of issuing a request for proposals (RFP) and then awards contracts to the companies that they judge to be worthy.  Often they do not award a contract only for the proposal that they judge to offer the best value, but to several companies that they judge to be worthy.

An RFP should provide specifications for a product or service that the agency wants to get.  “A four door two wheel drive sedan” is an example.  The buy boards typically do it differently.  They ask “how much will you charge us for your product”?  You and I both know that a Chevrolet sells for less than a Mercedes.  Here is an example of an awarded contract.  The vendor simply promises to sell a particular brand of equipment for a percentage of discount off of list price!

With this example the next thing we would see is some local government official driving around in a Mercedes.  They would claim that they got it through a competitive bid!  (I did not want to call out anyone in particular so I used this example because I do not know of anyone driving around here in a government owned Mercedes).  But our local governments actually do use these buy boards to pick the brand they want instead of the most cost effective brand.  This costs us money.

The court says

 There has not been a lot of action in the courts over this issue recently.  That is probably because the 1951 Texas ruling in Sterrett v. Bell was pretty clear.  In discussing competitive bidding the court wrote:

“Its purpose is to stimulate competition, prevent favoritism and secure the best work and materials at the lowest practicable price, for the best interests and benefit of the taxpayers and property owners.  There can be no competitive bidding in a legal sense where the terms of the letting of the contract prevent or restrict competition, favor a contractor or materialman, or increase the cost of the work of of the material or other item going into the project”

Let’s see:

  • They pick the product they like
  • The price may be higher than the competent competition
  • The price is inflated (at least by the buy board’s fee)

I cannot see how this can be competitive bidding.

We deserve better.

Leave a Comment » | City government, County Government, El Paso Independent School District, Purchasing, State Government | Permalink
Posted by jcurrey

Why rig a bid when you can fool City Council?

November 19, 2012

This link is to the City Council agenda backup item requesting 677,000 dollars for a new chiller for city hall.

It was bought through a buy board, The Cooperative Purchasing Network (TCPN).  There were several other vendors awarded at the same time as this vendor.

There was significant community input at the council meeting asking that the item be bid out.

Council’s vote was unanimously in favor of the no-bid long-lasting chiller.

City staff explained that they did not bid it out because they were in dire need of a new one and bidding would take too long.  Staff further explained that they wanted to get a chiller that would give them the longest life.

A review of the TCPN evaluation shows that 30% of the contract award decision was based on price.  How can that be a bid?  Then looking at TCPN’s web page for this contract, we can see that it says “Contact Vendor for Pricing”.  You think I’m kidding?  Look here!   As final proof that this deal was wired by staff be aware that the council meeting was September 12, 2010.  The vendor’s contract from TCPN was not effective until September 13, 2010.  I wish I was clever enough to make this stuff up!

They replaced the chiller in 2011.

A long lasting, no-bid chiller for a building that we are going to tear down now turns out to be a waste of our money.

By the way, TCPN gets 4% of whatever is awarded.  Don’t tell me that buying from the buy board was about efficiency.  The City of El Paso probably could have conducted its own bid for the $27,080 dollars that Houston based TCPN got as it’s cut on this, but then again staff wanted to pick their own vendor.  They waited for their favorite vendor to get its contract before they brought this to City Council.

We deserve better.

Leave a Comment » | City government, Purchasing | Permalink
Posted by jcurrey

Sole-source or favoritism or laziness?

November 13, 2012

This article is an example of how the City uses sole-source justification to avoid competitive bidding.

In this case the Fire Department wanted to buy 200,000 dollars worth of “cardiac monitoring and defibrillation supplies”.  I suspect that would include some actual units since pads and batteries appear to the most common supplies and $200,000 would be a whole bunch of them, but maybe I am wrong here.

The notarized sole source affidavit indicates that the vendor is the sole source for “External Defibrillators with the name LIFEPAK 500, LIFEPAK 12, LIFEPAK 15…for the City of El Paso Fire Department”.

The documents attached to the agenda are here:

http://www.elpasotexas.gov/muni_clerk/agenda/06-26-12/06261208E.pdf

A quick search on the web shows several companies that offer to sell the units and the supplies.  They claim that they offer the manufacturer’s warranty.

Some examples are here:

http://www.aedstoday.com/Medtronic-Physio-Control_c_15.html

http://www.aedprofessionals.com/Medtronic-LIFEPAK-500.html

http://www.aedsuperstore.com/physio-control-lifepak-1000.html

http://www.aed.com/physio-control-lifepak-1000-aed.html

http://www.aedbrands.com/defibrillator/medtronic/accessories/lifepak-1000

In fairness to the Fire Department a quick search on the web returns results showing that the manufacturer signs sole-source documents regularly.  Maybe they convinced the Fire Department that they are a sole-source supplier.

I have a harder time believing that the city Purchasing Department did not know that multiple sources exist.  They should have checked.

It is against the law in Texas to defeat the bidding process.

It is against the law in Texas to falsify a public document.

These items should have been bid.

Maybe when we get a new Fire Chief this kind of activity will stop.

We deserve better.

Leave a Comment » | City government, Purchasing | Permalink
Posted by jcurrey

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