A Case Study For A Procurement Policy Board

In 2006, the Buffalo Common Council unanimously approved an amendment to the City Charter which created a Procurement Policy Board.

Byron Brown, in the early days of his first term as mayor, signed the local law to create the Procurement Policy Board. Brown touted how the board could streamline city purchasing and save the city millions of dollars. Six years after announcing the importance of such a board, the mayor has not made an effort to appoint anyone to the Procurement Policy Board.

The Procurement Policy Board is supposed to consist of up to seven members appointed as follows:

• three by the mayor with the consent of the Common Council;

• two by the Buffalo Board of Education;

• one by the Buffalo Municipal Housing Authority;

• one by the Buffalo Sewer Authority.

In addition to appointing three members, the mayor designates the chair of the board. No member shall hold any public office and no compensation is to be provided to board members.

Purpose of a Procurement Policy Board

With the influence of campaign contributions and millions of dollars in city contracts available, there are many issues that a Procurement Policy Board could and should address. As stated in the City Charter, the purpose of the Board is:

The board shall create policies for procurement of goods and services for the city, including:

(1) policies designed to encourage cooperative purchasing by the city, the Buffalo city school district, the Buffalo municipal housing authority and the Buffalo sewer authority through the director of purchase,

(2) policies with respect to the methods for soliciting bids or proposals and awarding contracts,

(3) standards and procedures to be used in determining whether vendors are responsible, and

(4) policies governing the manner in which agencies shall administer contracts and oversee the performance of contracts and contractors. The board shall make such recommendations as it deems necessary and proper to the mayor and the council regarding the organization’s personnel structure and management of the procurement function including, where appropriate, recommendations for revision of this charter or local laws affecting procurement by the city. The board shall also review the form and content of standardized city contract documents and shall submit to the law department recommendations for standardization and simplification of contract language. The board shall not exercise authority with respect to award or administration of any particular contract or with respect to any dispute, claim or litigation pertaining thereto.

Encouraging cooperative purchasing

When Byron Brown ran for mayor, he stated that more needed to be done to consolidate city purchases of supplies and equipment. Instead of the city, school district, housing authority, and sewer authority purchasing toilet paper, vehicles, and other items separately, they might save money by pooling their purchases together. The sad reality is that the leadership of the city, school district, housing authority, and sewer authority never sit at the same table at the same time to discuss cooperative purchasing, or anything else for that matter. A Procurement Board that brings all of the parties together would be a great step forward to facilitating communication between city agencies that rarely work together.

Soliciting bids and awarding contracts

The Buffalo News has previously highlighted the fact that the law firm of Hodgson Russ has received more than $4 million in city legal business. Hodgson Russ has received more city business than all other law firms combined. Perhaps a Procurement Policy Board could review the policies and procedures being utilized or not being utilized in an effort to determine how is it that in an area filled with law firms, one law firm in particular gets hired over and over for city legal contracts. The $24,000 in political contributions made by Hodgson Russ to Brown’s campaign fund and the involvement of Hodgson Russ attorney Adam Perry in many political and community activities gives the appearance, true or not, that Hodgson Russ is receiving special treatment.

A recent audit by Buffalo City Comptroller Mark Schoeder determined that one company is receiving nearly 90 percent of the city’s towing business. Amazingly, towing work has not been put out to bid and the city is operating off of contracts that have been in place since 2000.

Prior to awarding a city contract, businesses should be solicited and provided the opportunity to compete for such business based on experience and price. Through a Freedom of Information Law request, I sought to find out if the City of Buffalo has sought competitive proposals from law firms. The answer I received from the city’s law department was that in October 2008, proposals were sought from law firms interested in obtaining city contracts.

When I requested to find out what law firms responded to the request for proposals, I was advised that offices have changed and records have moved since 2008 and that “Unfortunately, a diligent search of our records failed to reveal any record identifying those firms that responded to the RFQ, or of any firms being selected.”

Which begs the question: How exactly is legal work being doled out in the City of Buffalo, and how is it that one law firm, Hodgson Russ, has received more than $4 million in business? A Procurement Policy Board could shed some light as to whether proper bidding and proposal procedures are being followed for all city contracts.

Determining whether vendors are responsible

Is anyone documenting and reviewing the performance of contractors that do business with the city and related agencies? There may be certain contractors that have had performance problems with the city, school district, housing authority, and sewer authority, but since these bodies don’t share any information among themselves, they don’t have the benefit of any type of shared knowledge regarding the performance of contractors.

Contractor Man O’ Trees has been in the news quite a bit lately due to delays in completing projects at Martin Luther King Park and the Buffalo Niagara Medical Campus, as well as a project in Niagara Falls, where the contract with Man O’ Trees has been terminated by the City of Niagara Falls. According to Investigative Post, Man O’ Trees could be assessed $200 a day in liquidated damages for their failure to complete their Buffalo projects on time, but the city has not taken the step to assess any penalties. In addition to failing to complete projects on time, Man O’ Trees has failed to meet equal employment opportunity hiring goals for women and minorities, and at least three subcontractors have complained of not getting paid. Adding to this picture of a contractor that may not be acting responsible is the fact that Man O’ Trees owner, David Pfeiffer, has contributed a total of $17,000 to Mayor Byron Brown’s campaign committees in 2009 and 2010, making him one of the mayor’s largest donors.

A Procurement Policy Board could help establish uniform standards and procedures for determining whether a contractor is performing responsibly. Perhaps the time has come to adopt a policy whereby businesses and individuals doing business with the city are restricted from making political contributions. Several communities across the country, in an effort to prevent corruption and the appearance of improprieties, restrict campaign contributions from businesses and individuals who have or are seeking city contracts.

Standardization and simplification of contract language

Private sector businesses frequently complain about how difficult it is to conduct business with government entities. The amount of paperwork involved and the lack of uniformity among the city, school district, housing authority, and sewer authority can be overwhelming for companies.

The city has set goals for a portion of all city contracts to include minority- and women-owned companies. The paperwork for all of these efforts should be standardized and simplified where possible to make the achievement of contracting goals easier and more successful. A Procurement Policy Board that gets everyone sitting at the same table could have a big impact on standardizing and simplifying contract procedures in a city that desperately needs to encourage job creation as much as possible.

Why hasn’t the Procurement Policy Board been formed?

Byron Brown made several promises when running for mayor:

• to operate government in an efficient way;

• to make life easier for businesses in terms of government regulations and procedures;

• to create jobs;

• to improve compliance with minority and women hiring goals.

A Procurement Policy Board can play a key role in fulfilling all of these promises.

Does your community have a Procurement Policy Board?


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