The Maryland Port Administration has admitted in writing to Lamarian Systems Inc., a Greenbelt computer software company, that the state was guilty of "several lapses" in the award of a key software contract for the Seagirt Marine Terminal.
The letter from Brendan W. O'Malley, executive director of the Maryland Port Administration, is part of a settlement in which Lamarian has agreed to withdraw its challenge to the award of the contract to a competing software company in return for the state's admission that it violated state procedures for procurement contracts. Lamarian will not receive any money under the terms of the settlement.
Mr. O'Malley stated in the letter, "We think that the MPA conducted a proper procurement that was fair to all participants. However, we recognize that several lapses did occur in the 1989 software procurement."
Steven K. Fedder, an attorney for Lamarian, said yesterday, "The agreement acknowledges the correctness of our position. I view it as an exoneration of Lamarian."
The letter has not yet been dated or signed, but both sides have agreed to accept its contents, Mr. Fedder explained. The two sides still must sign the settlement, which includes an agreement by Lamarian not to pursue its challenge to the award. Problems with the software contract were among the major reasons for the year-and-a-half delay in the opening of the $250 million Seagirt terminal. The contract was awarded originally to California Stevedore and Ballast Co. in the spring of 1989 for $546,268 over five years.
After evaluating the proposals in terms of price and technical requirements, the port agency gave CS&B's bid a score of 836. Lamarian wasranked second, just a point behind with a score of 835. The Lamarian bid of $507,662 over five years was about 7 percent lower than CS&B's.
Later that year, CS&B began having difficulties completing the contract to the satisfaction of the MPA. In early 1989, the state terminated the CS&B contract for non-performance. CS&B contested the cancellation of the contract and has filed a claim that is still pending.
After canceling the CS&B contract, the state decided to give the work to the second-ranked bidder -- which turned out to be Maersk Data USA rather than Lamarian, even though Lamarian had never been told it had been downgraded in the rankings.
In Mr. O'Malley's letter to Lamarian, he explained that the MPA had neglected to consider a crucial electronic interface in its original evaluation of the proposals.
"This error resulted in our re-evaluating and re-ranking the submitted proposals such that Maersk Data placed second and Lamarian third," Mr. O'Malley said in his letter. The port agency further erred in not informing Lamarian of the change in rankings, Mr. O'Malley said.
Rather than solicit new bids, the state chose Maersk in late February 1990 because the port was rushing to open Seagirt by April 1, then just a little more than a month away. The value of the contract has more than tripled since the initial award. This month the state added $95,800 to the contract, bringing its total value to $1,045,800.
Harry E. Latimer, president of Lamarian, said Wednesday that though the settlement ends the dispute, he doubts whether his company will bid on MPA contracts for some time to come. "We would be very cautious," he said, and would bid only if changes were made in the current management of the MPA.