In The News › Watchdog group: Many flaws in city contracts

Nov 8, 2010

Source: WWLTV

Filed under: Contracting, Orleans Parish

Watchdog group: Many flaws in city contracts

Monday, November 8, 2010
By Dominic Massa and Mike Hoss

NEW ORLEANS — A new report by the Bureau of Governmental Research finds major flaws with the contracting process for the city of New Orleans, including examples where it says the city wasted tax money on some contracts, ignored its competitive selection process on others and mislabeled some contracts as professional services contracts to skirt the law.
Among the contracts for work never performed, according to BGR’s analysis, were a nearly $100,000 deal for a web site for the city’s former Office of Recovery and Development Administration, which BGR said was designed and delivered to the city but is no longer publicly accessible. Another contract, for $15,000, paid for a citizen’s guide to city services, which BGR said was never published.

Among the contracts reviewed by BGR for its study Inside Outsourcing: A Year in the Life of City Contracting were the $46.8 million tech contract with Ciber Inc.; its $31.7 million recovery project contract with MWH Americas Inc.; and the city’s three sanitation contracts, totaling $35.9 million in 2009.

The sanitation contracts have been the subject of controversy recently, with the Landrieu administration seeking to rebid two of the contracts, with Metro Disposal and Richard’s Disposal.

The Ciber deal was the most expensive contract reviewed by BGR, which it said ballooned from $5.5 million to $46.8 million over four years, with the Ray Nagin administration assigning additional duties to the company.

“In renewing (the contract), the City transformed the contract from a discreet set of pre-Katrina services to a massive privatization of its information technology services after post-Katrina layoffs in that department,” BGR writes.

Other contracts, including a $7.5 million one with ACS State & Local Solutions, for the city’s beleaguered 311 phone system, were engineered as professional services contracts that should have been bid as nonprofessional services contracts.

BGR found that 94 contracts, “nearly 25 percent of all professional services contracts reviewed – did not go through a competitive process because they had contract caps below the $15,000 threshold,” according to the report.

The group also studied the city’s practice of using contractors for recurring functions that it said could be better handled by in-house staff. That could include utilities regulation and the office of technology.

BGR also criticizes the city for its mishandling of public records, which led to the hiring of outside law and technology firms related to a lawsuit filed by WWL-TV for a news report seeking former Mayor Ray Nagin’s email and calendar.

“The lawsuit generated several contracts: a $15,000 contract for legal advice; an $8,500 contract…to recover missing e-mails…and…a $15,000 contract with another tech firm to review the first one’s work,” according to BGR’s report. BGR also details the money spent by the city in another public records fight, involving City Council members’ email.

“All in all, the City spent approximately $330,000 on legal and technical costs that resulted from the improper handling of public records,” BGR writes in its analysis.

BGR makes several recommendations to reform the contracting process, including the city’s determining whether a service is necessary before entering into a contract, then determining whether the service can be performed in-house to save money. It also suggests that the administration classify contracts better and review contracts more closely before expanding their scope of services or pursuing a new contract.

BGR also urges the city to consult the inspector general before expanding the scope of a contract.

In response, deputy mayor and chief administrative officer Andy Kopplin said the Landrieu administration is already working to implement changes to the contract policy and make the process more transparent.

“There’s a role always for outside contracts and there will be continued roles for those,” said Kopplin. “But the question is can we make it, in City Hall, with city employees, cheaper? Should we pay a contract and pay twice as much as it would cost a city employee?”

Nov 8, 2010

Source: WWLTV

Filed under: Contracting, Orleans Parish

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