Tag Archives: Nancy Kopp

Procurement Disgrace

By Barry Rascovar

March 20, 2015 — Maryland’s system of contracting for services through competitive bids is in shambles. It has been that way for years — and is getting worse.

It’s an embarrassment to taxpayers. Yet a long list of procurement debacles hasn’t been enough to spur sweeping reforms.

That seems likely to change, thanks in part to a royal screw-up on a food-service contract that all three members of the Board of Public Works strongly denounced last week.

Procurement Disgrace

Maryland Board of Public Works

Gov. Larry Hogan Jr. described the badly botched prison-food procurement as “one of the most disgraceful displays of mismanagement” he’s seen in his long business career.

Comptroller Peter Franchot, a persistent but lonely critic of these contracting disasters, called it “the most troubling procurement” in his eight years on the board.

Treasurer Nancy Kopp, ever the diplomat who chooses her words with care, said she was “sorely troubled.”

Nightmarish Tales

Nearly every month, the board hears nightmarish tales of state contracting efforts gone awry, of contractors who submit low-ball bids only to seek costly add-ons later, of inept procurement  officials who misapply contracting rules, tilt the playing field, make a mess of the bid-and-award process or fail to use common sense.

Hogan and Franchot earlier this year repeatedly skewered University System of Maryland officials for ineptly explaining cost overruns and excessive spending on university capital projects.

Now the prison-food contract horror story has led board members to the brink of action.

It’s a tale of stupidity by corrections officials under former Gov. Martin O’Malley.

It’s a tale of a contractor using the threat of cutting off food deliveries to Baltimore inmates to secure a whopping 54 percent boost in state payments.

It’s also a tale of misleading statements that are coming back to haunt the winning bidder.

Franchot called the misadventures of this contract award “highly irregular.” He urged the governor to ask Attorney General Brian Frosh to investigate and determine whether this was the result of “staggering incompetence — or something else.”

Franchot also should have asked the governor to appoint a blue-ribbon panel of outside experts to study recent procurement disasters and recommend ways to fix a dysfunctional system.

Meals Per Day

In short, here’s what happened on the prison-food contract.

State corrections officials made the inexcusable mistake of erring on how many meals are served to Baltimore prison inmates each day. This should have been basic math, backed up by recent meals-per-day figures.

Yet corrections officials requested contractors submit bids for serving 23,000 daily prison meals. The actual number should have been closer to 15,000.

That’s a huge difference because the contractor is paid on a price-per-meal basis.

The incumbent contractor, based on its seven years of experience at the Baltimore prisons, estimated it would cost $89 million over three years to fulfill the food contract. The other bidder came up with a stunningly low figure of $37 million.

That’s a whopping difference — a gap in bids so gigantic it should have set off alarm bells. Something was very wrong with the state’s request for proposals (RFP).

Board Approval

Instead of catching the mistake early, state prison officials went ahead and awarded the contract to the low bidder, which hadn’t even taken the basic step of inspecting the prison kitchen facilities before bidding.

Such naiveté never surfaced when the board, under O’Malley, approved this contract in early January. Instead, the company called itself award-winning and pledged to do a great job.

Almost immediately that promise collapsed.

The prison kitchen facilities needed hundreds of thousands of dollars in upgrades that the contractor hadn’t figured on. Health inspectors listed 11 pages of required remediation.

The vendor was serving nearly 8,000 fewer meals per day and losing $70,000 a week.

On Feb. 24, the company informed the state it would stop serving inmates on Feb. 28 — just four days later — unless its compensation was boosted immediately by 53 percent.

Faced with the prospect of inmates going without food, new corrections secretary Stephen Moyer had little choice but to give the vendor what it wanted — an emergency, six-month, $6.6 million contract that dramatically jacked up payments to the vendor.

Moyer wisely cancelled the original contract award, which is supposed to be re-bid in about six months. Good luck on that one — especially since the department that bungled the first RFP-and-award process is still running the show.

Franchot called the winning vendor’s explanations “deplorable.” “You essentially deceived us,” he told the company’s owners last week.

But whose fault was it? The state is so culpable that legal action against the winning bidder may not be possible.

Thorough Vetting

In reality, it is a systemic problem.

From top to bottom, Maryland’s procurement laws and procedures need a thorough vetting by experts. The process is too easily manipulated by contractors and by state officials.

Hogan has grown increasingly irritated by the flawed and costly contracting mistakes that have come before the Board of Public Works since he took office in late January,

Enough already.

Actions to revamp and improve the system will speak far louder than angry words of disgust.

###

Treatment, Not Jail, for Md.’s Troubled Youth

Silver OakBy Barry Rascovar / June 15, 2013

LET’S NOT MAKE A MOUNTAIN out of the Maryland Board of Public Work’s decision to allow a Carroll County facility for troubled juvenile teens (photo on left) to exceed an artificial cap on population set by the state for such treatment centers.

It was a practical, common-sense action that places the welfare of these disturbed teens ahead of a rigid, inflexible capacity limitation set by Maryland legislators — a limit that actually hurts the very youths this restriction was designed to help.

Maryland Treasurer Nancy Kopp, who repeatedly expressed reservations at last week’s meeting about doubling Silver Oak Academy’s population, rightly concluded, “You can’t make the perfect the enemy of the good.”

Yes, it’s been shown in other states that smaller treatment centers for young delinquents are more effective in helping them face up to their problems. A 48-bed center is the ideal, but governments rarely face ideal situations.

Right now, there are 43 youth offenders sitting in detention cells awaiting court-ordered placement. No beds are available in any state treatment center. That is the worst possible outcome for these troubled kids.

Why does this chronic situation keep occurring? Because local political leaders block state attempts to locate such facilities in their communities, so that the kids are close to their families. It’s the old “not in my back yard” (NIMBY) attitude, which overrides society’s obligation to do what’s best for difficult-to-handle youngsters.

Opposition from politicians in Southern Maryland and in Baltimore City has stymied efforts to site juvenile care centers (52 city locations failed to pass the NIMBY test) . So 43 kids languish in detention cells, becoming victims of a broken system. The harm done to them is something Maryland Juvenile Services Secretary Sam Abed says, “I can’t tolerate.”

His interim answer: allowing Silver Oak Academy in Keymar to slowly take in 48 more residents. In essence, the operators will run a mirror-image, companion 48-bed center on the property.

Staffing ratios won’t change. Every step taken by the private operator will be closely followed by the attorney general’s juvenile justice monitor (who preferred an expansion of only 24 beds), the Public Defender’s office and by internal department watchdogs.

This isn’t as Sen. Bobby Zirkin of Baltimore County put it, a “giant step backward.” More accurately, it is a reality check.

Last winter, legislative budget analysts assessed the overcrowding situation and concluded doubling Silver Oak’s capacity “would provide some immediate relief.” It noted that due to repeated local rejection of suggested juvenile  treatment center sites, the state “is multiple years away from having additional. . . capacity available.”

To date, Silver Oak Academy has gotten high marks. There is no indication this will change with 48 extra teens at the facility.

In this instance, the state’s first duty is to get the teens who shouldn’t be there out of detention jails. If that means ignoring an artificial 48-bed limit in the short-term so be it. Treatment should always trump incarceration for young offenders who may yet become model citizens.