City admits going overboard helping minority firm win bid

$40,000 overpaid for bulbs before contract awarded to black-owned company

December 04, 2003|By Doug Donovan and Laura Vozzella | Doug Donovan and Laura Vozzella,SUN STAFF

A racially charged bidding war that shed light on the city's efforts to do more business with minorities ended yesterday with a black-owned firm winning a government light bulb contract.

B&B Lighting Supply Inc. landed a two-year, $1.1 million deal after the city went to great lengths to help the Baltimore company, offering assistance in ways that were meant to rectify past discrimination but were costly to taxpayers and violated city purchasing rules.

The city's well-intentioned efforts to assist minority companies - a top priority of Mayor Martin O'Malley's administration - led officials to:

Buy $230,000 in bulbs from B&B since March 2000, despite having a contract to purchase the same items for less from a white-owned firm. The city overpaid for those bulbs by nearly $40,000, invoices show.

Alter the city's first bid proposal, removing fiscal safeguards, to help B&B and other small, minority firms.

Lobby a lighting manufacturer on B&B's behalf to help it become an authorized distributor - a designation necessary for bidding on the contract.

The city admits it went overboard. It scrapped the first round of bids after learning that the purchasing director rewrote the proposal to help B&B. The director, Arthur B. McNeal Sr., left his job about that time, although officials say there was no link. Officials acknowledge that buying from B&B before it had a contract also was a mistake, one they are investigating.

"We should be buying [from] the contract," said city Solicitor Thurman W. Zollicoffer Jr.

But those concessions aren't enough to satisfy companies that lost out to B&B in a four-month-long competition marred by allegations of discrimination, contract steering and physical assault.

"The fix was in from the start," said Robert A. Mills III, president of white-owned C.N. Robinson Lighting Supply, which has held the contract for a generation. "We won the contract for the past 25 years because those prior bidding processes were fair and not politically motivated like this one."

B&B says it received no special treatment in the recent bidding, though it is grateful to O'Malley for helping it obtain a distributorship required for the bid. It also says there was nothing wrong with prior purchases.

"The city has the right to buy from whomever they want to buy from and at whatever price they want to buy from. That keeps it equal for minorities," said Sharon Bradford, president of B&B.

B&B also says the off-contract purchases served a greater good by helping a black-owned firm get a foothold in an industry that whites have long dominated.

The $1.1 million lighting deal, which takes effect next month, is a regional contract, meaning state and county governments can "piggyback" onto the deal or choose other suppliers.

City agencies, however, are supposed to buy their bulbs from the company that holds the contract, said Edward J. Gallagher, acting purchasing director. For the past 25 years, that has been C.N. Robinson.

But starting about four years ago, officials at a few city agencies began buying bulbs from B&B, which cost the city $40,000 more than C.N. Robinson would have charged for the same products.

Last March, the Baltimore Convention Center bought 240 300-watt incandescent lamps from B&B at $7.45 per bulb, for a total of $1,788. Under the city contract, C.N. Robinson's price was 88 cents each - $211.20 for 240.

In September 2002, the convention center bought 22 safety lifeguard vapor lamps - an extra durable bulb - from B&B at $52 apiece, for a total of $1,144. C.N. Robinson's price was $18.97 each - $417.34 for 22.

The city's Office of Cable and Communications spent about $5,400 with B&B. The reason?

"It was suggested that we use minority vendors," said Barbara Novak, who placed the orders as executive assistant with the office.

Novak also said C.N. Robinson had problems filling orders. She said she chose B&B at the suggestion of someone in the city's purchasing department. She could not remember who.

"I just thought I was doing the right thing by using who they said," she said.

Spreading the word

The convention center spent $128,000 with B&B since October 2001, turning to the company after city officials urged agency heads to try to use it because it was minority-owned, said Peggy Daidakis, executive director of the convention center.

"Owen Tonkins [director of the Mayor's Office of Minority Business Development] and Arthur McNeal made a general announcement that, `Here is a company, B&B, that is a minority business, if you could put them on your list of general companies to buy from,'" Daidakas said. "That's how we heard of B&B."

McNeal said he had no involvement in the convention center purchases.

"There was never any effort by the Bureau of Purchases on my part to secure anything for B&B Lighting," McNeal said. "Everything was done on a competitive bid basis."

Tonkins said he did not recall recommending B&B, and added that he never would have suggested circumventing an existing contract.

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