Foster care contract is in dispute

Losing bidder accuses department of favoritism

May 07, 2002|By Michael Dresser | Michael Dresser,SUN STAFF

A losing bidder for a contract to provide foster care services for 500 children has protested the Department of Human Resources' decision to award the $42 million pact to a rival company, contending that state officials showed favoritism toward the eventual winner.

Foster America Inc. has filed an appeal with the Maryland State Board of Contract Appeals, challenging the department's decision to award the contract to Adoptions Together, a Silver Spring nonprofit organization.

The winning contractor will provide placement services and case management for children in foster care. The three-year contract is one of the larger ones to be appealed to the Maryland board in recent years, said Dean Bouland, a procurement law specialist with the firm of Bouland & Brush in Baltimore.

The award had been scheduled to be approved by the Board of Public Works late last month, but the item was pulled from the agenda after the appeal was filed and is not scheduled to come up at tomorrow's meeting. A department spokeswoman would give no reason for its decision.

Foster America, a Baltimore-based subcontractor of the Martin Pollak Project, told the appeals board that during the first round of a contract solicitation last fall, DHR gave Adoptions Together four opportunities to revise its proposal. Foster America suggested in the appeal that its rival might have benefited from the intervention of lobbyists and legislators, but did not name individuals.

Donna Foster, a DHR procurement officer, denied the accusations in a letter sent April 19 to Foster America's lawyer, saying the department "treated all offers fairly and equally."

Foster America sued the department last week, accusing it of violating the state's freedom-of-information law by withholding requested documents. The department said in a letter to Foster America's lawyer, Scott Livingston, that it had provided all of the documents Foster America was entitled to see.

`Straightforward'

Janice Goldwater, executive director of Adoptions Together, said her organization had received no special treatment.

"I haven't any idea how anyone could say there was any favoritism shown. It is a very regulated, straightforward process," Goldwater said. She added that Adoptions Together does not have a lobbyist and that she knows nothing about any involvement by legislators in the contract award.

Livingston said in his filing that his client placed first in the initial round of bidding and should have gotten the contract, even after its rival was given extra chances.

State scoring sheets show that Adoptions Together's final proposal last fall was deemed "nonresponsive" because it excluded "medically fragile" children from its financial offer. The other two bidders, Foster America and Pittsburgh-based Pressley Ridge Schools, included such children.

Process restarted

Instead of awarding the contract to Foster America, the department decided to cancel the solicitation and restart the process from scratch. A procurement officer told the bidders Dec. 6 that the proposals had been rejected because the original contract solicitation needed "clarifications and amendments" to comply with the law.

The department issued a second request for proposals later in December, taking the unusual step of asking that bidders omit any details that would reveal their identity.

Livingston alleged that where the first procurement used professional evaluators from inside and outside the department, the second-round bids were judged by people without such qualifications.

Department documents show that the agency's inspector general, Jeanne King, chaired the second evaluation committee.

Larry Baker, former chairman of the contract appeals board and a procurement lawyer, said the inspector general's active role in a procurement is unusual because that official's job is to provide oversight.

"It raises the possibility of a conflict," Baker said. A department spokesman declined to comment on the matter.

William Kahn, who heads the contract litigation section of the attorney general's office, found King's role less troublesome. He said agencies have broad discretion in how they set up their selection processes.

On March 15, the department notified Foster America it had not been selected in the second round. Instead, the contract was awarded to Adoptions Together. The winner was ranked first in its technical score and submitted the lowest bid - $41.9 million compared with Foster America's $42.4 million.

Bias alleged

In his appeal, Livingston told the board the second evaluation committee was biased in favor of Adoptions Together. He charged that department officials had engaged in improper discussions with Adoptions Together but not with his client.

Foster America appealed and requested a debriefing, a right guaranteed losing bidders under Maryland procurement law. In an unusual move, the department sent its inspector general, King, to conduct the debriefing in place of the usual procurement officer.

In his protest, Livingston contended that King's debriefing did not comply with the law because she lacked knowledge of the evaluators' reasoning for rejecting his client's bid.

The lawyer also contended that the second-round requirement that bidders conceal their identity was unfair because it prevented Foster America from recounting any of its experiences with running an earlier pilot program for 500 Baltimore children in foster care.

Baker, however, said he saw no problem with the "blind" bidding procedure.

Adoptions Together's Goldwater expressed hope that her organization's contract award will be ratified soon.

"We're really anxious to get this project up and going," she said.

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