|When you work for the circus
What do they mean by “bid rigging”?
It’s not failing to bid out contracts, or ignoring the rules providing for fair competition entirely. It is just being tricky. And it’s a crime.
The guy with sundry political connections who helped win the bid for the Housing Authority maintenance contract for a brand new company, also won a bid for his own company to demolish Addison Terrace.
He kind of won it:
Three Rivers Dismantlement is handling much of the razing of Addison Terrace, a 734-unit community that will be replaced with around 400 mixed-income apartments. The authority has hired Columbus, Ohio-based developer Keith B. Key Enterprises to transform and run the community.
The prime demolition contractor, Phase One Development Corp. of Penn Hills, hired Three Rivers Dismantlement as its subcontractor. Executives at three of the largest area demolition firms — Noralco, PRISM Response and Bristol Environmental — said this week that they were not invited to bid on the job.
Developer Mr. Key explained in an email that Phase One got the job because of their ranking in a proposal process conducted by the authority in 2010.
That’s when the authority sought proposals from firms to perform “demolition work … housing authority-wide on an as-needed basis.” A resolution approved by the authority board in October does not mention Addison Terrace, but allows the authority to pay Phase One $3 million over three years. The resolution indicated that 12-year-old Phase One was picked over three other firms “based on their experience and capacity.” (P-G, Rich Lord)
The Authority hired the developer, who hired a contractor, who hired the subcontractor that is connected both to the Authority and to nefarious politicians going way back.
The developer relied on an evaluation by the Authority for proposals to do work “on as as-needed basis,” which entitled their contractor to privately solicit bids. They in turn selected a firm which until that point had only reconstructed a hillside and replaced a valve for the Authority. So a bid that appeared to go out for odd jobs over time — perhaps too irritating and unsteady to be relied upon, not one company’s specialty — turned into a contract for their single biggest piece of business, and with bids solicited privately by the contractor.
These are the sorts of things which cast doubt on a bidding process: unusual processes and connected winners. But one feature of many political and entrepreneurial “connected” people may be their social adeptness, resiliency and streetwise in a way that wins them contracts. And Pittsburgh is a small town, coincidences happen.
But then there was that first process…
The authority requested proposals for the landscaping contract on March 7, 2012, and held a pre-bid meeting on March 23. Sign-in sheets indicate that 11 firms attended the meeting, and no one from Pittsburgh Property Maintenance signed in.
Computer records that Mr. Detrick showed, though, indicate that Fontana, representing Pittsburgh Property Maintenance, was one of numerous prospective bidders who signed up to get online access to bidding materials.
The proposal submitted to the authority by Pittsburgh Property Maintenance lists a phone number that is now disconnected. The address provided was that of The McQuillan Group, an accounting firm. A receptionist there said Pittsburgh Property Management used that address only briefly, and she confirmed that Fontana was the contact person for the landscaping business.
Despite the number of firms that attended the pre-bid meeting, only Pittsburgh Property Maintenance placed a bid by the April 4 deadline. Federal rules required a rebid.
The authority scheduled a second bidding deadline, May 7, which drew three proposals. One was disqualified as late, and another was deemed unresponsive because it didn’t include participation by minority- or women-owned businesses, among other reasons. The sole survivor, Pittsburgh Property Maintenance, was awarded the contract. (P-G, Rich Lord)
Eleven that are initially interested and go to a meeting. They hear something, or go on to learn something, and all change their mind. None of them submit a bit.
One newly created and already mysterious firm with a connected agent enters the process and finds itself the sole bidder. That’s not good enough obviously, so the project is “re-bid”, and this time a couple of other firms are motivated for whatever reasons to submit non-qualifying bids.
Same agent as before, the one with the red flags — not the least of which was a cocaine conviction.
So it is walking like a duck, and quacking like a duck.
And others in the contracting community — who might not ordinarily invite the displeasure of the public sector — are pointing at it, performing flapping and waddling pantomime.
Has anyone been paying attention to the city’s Housing Authority who can explain why this is not the way it appears? Or has City leadership fully transcended the need to be either answerable or accountable to anybody?
Because if that’s the case, one may as well step down.