According to documents provided by City of Bridgeport employees, Paul Vallas, Bridgeport’s $229,000 Part-time Superintendent of Schools, or members of his senior staff, provided false information on official City documents in order to use a technique called “sole-sourcing” to give a major City contract to a company called the Public Consulting Group Inc. Vallas provided the same company with multi-million-dollars contracts when he was the CEO of the Chicago Schools and again when he was CEO of the Philadelphia Schools.
Up until this year, Bridgeport has been using a software program called Clarity to track and coordinate Bridgeport’s special education program. But this past March, Team Vallas used a “sole source” acquisition process to drop the Clarity software and sign a multi-year contract for the Public Consulting Group’s EasyIEP software.
After former Governor John Rowland went to prison for his criminal involvement in directing state contracts to particular vendors in return for kickbacks, the State of Connecticut and many of its cities and towns strengthened their laws and regulations requiring the use of competitive bidding when public entities are purchasing goods or services.
Today, contracts signed by the City of Bridgeport must meet the provisions of Connecticut State Statute 7-148v and Title 3 of Bridgeport’s Municipal Code.
These laws require that any contract over $7,500 must be competitively bid unless they meet a series of very limited exceptions.
In order to get an exemption from the competitive bidding requirement, the public official must submit a form PUR100: Justification for Sole Source Acquisition, and then receive approval to move forward. The exemption can only be granted when there are special circumstances that warrant not going through a bidding process.
In the case of the special education software, Team Vallas attempted to justify their sole source request by stating that the Public Consulting Group’s product was so special and so unique that it wasn’t even worth soliciting bids from other companies. The sole source request stated that “PCG’s EasyIEP system is the most comprehensive, all in one Medicaid/Health case management system available and that they offered a number of unique features”
Paul Vallas’ Chief of Staff expanded on their rationale in a response to a question on the Superintendent’s website: See https://sites.google.com/site/bpsdirect/question-forum-1.
As to why the Superintendent chose EasyIEP, his office stated;
“There are a multitude of reasons why Bridgeport Public Schools has found itself with a major budget deficit each of the last three years. One of these big factors which we uncovered in January was that over the past few years, Bridgeport has seen a massive drop off (40%) in the amount of potential Medicaid reimbursements which is currently being recouped.
A large part of this drop is due to the fact that with the Clarity software previously in use, all reimbursements had to be submitted manually. Additionally, the Clarity program was down to only two clients nationally, giving us some concerns about its future viability going forward. As a result, the district decided to look at potential different options. What we found in our search was that there was only one option which provided an automated Medicaid reimbursement process– EasyIEP. Not surprisingly, given that they offer this unique service, EasyIEP is currently used by 2,600 districts across the country.”
Apparently the purchasing department fell for that argument and the Vallas’ request to skip any competitive bidding was approved. Vallas signed a contract with the Public Consulting Group on April 23, 2012.
However, it turns out that almost every point that Paul Vallas and his team used to rationalize the appropriateness of skipping a competitive bidding process was false.
Team Vallas wrote that “a large part of this drop [in Bridgeport’s Medicaid Reimbursement Bridgeport] is due to the fact that with the Clarity software previously in use, all reimbursements had to be submitted manually.
- The statement is COMPLETELY FALSE: Clarity actually has a state-of-the-art Medicaid Reimbursement Module for their software and that module ensures a school district gets all the Medicaid funds it is entitled to. However, the City of Bridgeport NEVER PURCHASED THAT MODULE and, instead, chose to handle all Medicaid reimbursement manually.
Team Vallas wrote that “the Clarity program was down to only two clients nationally, giving us some concerns about its future viability going forward.”
- The statement is COMPLETELY FALSE: In fact, just last month, following an intensive competitive bid process to determine what was the best special education software for use in the State’s Technical High Schools, the Connecticut State Department of Education AWARDED THE CONTRACT TO CLARITY/EXCEED the very company that Vallas’ office claims is down to only two clients. What the failed to reveal was that the upgraded version of Clarity is being used under the name of Exceed and that Clarity/Exceed is being used in districts all across the country.
Team Vallas wrote that “as a result, the district decided to look at potential different options. What we found in our search was that there was only one option which provided an automated Medicaid reimbursement process– EasyIEP. Not surprisingly, given that they offer this unique service, EasyIEP is currently used by 2,600 districts across the country.”
- The statement is COMPLETELY FALSE: There are, in fact, a number of vendors that provide very successful automated Medicaid reimbursement systems for school districts. In fact, the very company that Vallas terminated, Spectrum K12, which owns the Clarity/Exceed software is partnered with another firm called Accelify. A simple Internet search would have made it clear that Accelify is “one of the largest and fastest growing school-based Medicaid billing agents in the country, currently serving hundreds of school districts.” Undoubtedly Bridgeport’s existing vendor could have submitted a very competitive bid had they been given the opportunity.
And Team Vallas also wrote that EasyIEP is currently used in 2,600 districts.
- And even that statement is COMPLETELY FALSE: EasyIEP’s own website claims that they are used in less than half of that number of districts.
Finally, perhaps most damning of all, is that even if Bridgeport determined that the best solution was to use the Public Consulting Group’s Medicaid Reimbursement software, one option would have been to do what a major Nevada school district did. They had Clarity/Exceed develop a “connection” that allowed all the necessary special education data to simply transfer over to PCG’s Medicaid billing system, thereby allowing the school district to utilize both programs.
The most preliminary investigation reveals that virtually nothing that Team Vallas claimed in their effort to give Bridgeport’s special education software contract to the Public Consulting Group was true.
Purposely ducking the competitive bidding laws and regulations in Connecticut and Bridgeport is a major violation of law and has far-reaching civil, and potentially even criminal, penalties.
Appropriate officials, including the Office of the Attorney General, the State Auditors and potentially even the Chief State’s Attorney, need to conduct a proper investigation and ensure that evidence is not destroyed.
And will the failure to competitively bid this project have a negative impact on taxpayers in Connecticut and Bridgeport?
Check back here at Wait, What for the next installment post on this issue.
Every Connecticut taxpayer will be disturbed by the ramifications of Team Vallas’ unwillingness to abide by the laws requiring competitive bidding.