Every city expenditure over $5,000 needs prior approval by the Board of Estimates and every contract over $25,000 must be competitively bid.
Yesterday when the spending board handed out $637,741 to P. Flanigan & Sons for paving work that was never put out for competitive bid and never received prior approval by the board.
The mechanism used to skirt the bid rules are “EWOs,” or extra work orders, appended to board-approved contracts. There is no public notice of these extra orders, only notification in board records when the work is paid by the city.
EWOs have been periodically criticized as circumventing the city’s bidding rules, but they regularly pass through the spending board headed by Mayor Stephanie Rawlings-Blake and City Council President Bernard C. “Jack” Young.
In yesterday’s example, Flanigan got paid for extra work under TR 10324, a contract awarded last June to prepare Inner Harbor streets for the Grand Prix race.
The $4.1 million road contract was itself controversial because the Flanigan firm and family are such heavy contributors to local political campaigns. The Brew, for example, disclosed that Rawlings-Blake received $13,500 in Flanigan contributions since 2008.
The reason: because the city realized that repairs were urgently needed on Key Highway. “We needed to get Key Highway done immediately in order to provide a detour before the closure of the Fort Avenue Bridge,” Jamie Kendrick, deputy DOT director, said yesterday.
Putting the work out to bid would have been a waste of taxpayer’s money, Kendrick said.
“Processing a bid costs $50,000-$60,000 when you include advertising, staff costs and overhead. Because time was short and because the contractor [Flanigan] was working in the area, we went ahead. The convergence of these factors – time, availability and proximity – all made sense.”
So DOT submitted two extra work orders to TR 10324, saying in a change-notice-request form: “The scope of work mirrors the infrastructure improvement project” in the Inner Harbor and “the department obtained a cost proposal from the contractor who is already working in the Key Highway area.”
The convergence of these factors – time, availability and proximity – may make sense, but I do not know them to be factors in determining whether new or additional items fall within the analysis of scope of contract rules that require new bids for work outside the scope of contract.
The principles of procurement do not include the excuse of convenience nor corner-cutting nor cost/benefit analysis before deciding to undertake a competitive bidding.
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