Vallas need only think back twelve years ago, when The Chicago Tribune led with an editorial that began with the headline; “Appearances Matter, Mr. Vallas.”
And yet, despite that memory, it has become increasingly clear that Bridgeport’s Superintendent of Schools doesn’t fully understand or appreciate that fact that the competitive bidding of contracts is an important safeguard for public funds, not to mention the fact that Connecticut and Bridgeport have strict competitive bidding requirements that must be met.
Since Vallas arrived in Bridgeport last December, he has signed or authorized at least twenty contracts, which taken together, put taxpayers on the hook for more than $13 million.
According to state and local laws and regulations, it appears that at least eighteen of the twenty contracts needed to be put out for full competitive bids. It is hard to tell from the information that has been provided, but two of the new contracts might have only needed a competitive proposal process.
In any case, none of these contracts appear to have been handled appropriately.
What is particularly shocking is that more than a decade ago, Paul Vallas learned the hard way that failing to properly bid contracts can have significant consequences.
On August 3, 2000, the Chicago Tribune skewered Vallas for failing to put a key contract out to bid.
The Tribune’s editorial laid out the facts by beginning with the following description:
“Four years ago, the Chicago Public Schools busing system was headed the wrong direction down a one-way street. Bus contractors were running up millions in penalties for a litany of safety violations, from malfunctioning radios to missing fire extinguishers. They also had been overbilling school administrators to the tune of $2 million in one year.
Then the system crashed.
During the first days of the 1996 school year, a sudden shortage of qualified bus drivers left thousands of elementary school children stranded at bus stops, dropped off hours late or stuck in schools at the end of the day.”
Paul Vallas was the CEO of the Chicago School System at the time and as part of a broader privatization effort and in order to “stabilize” the situation, Vallas gave a no-bid contract to a company called Vancom/TransPar to manage Chicago’s $100 million school bus operation.
Only later was it discovered that Vallas chose Vancom based on the recommendation of his father-in-law, Dean Koldenhoven, the mayor of Palos Heights, Illinois (a small city just Southwest of Chicago.)
Vancom’s owner, Terry Van Der Aa, was not only a family friend but he owned the largest family-owned school bus company in the United states
But it was what happened next that got the Tribune’s editorial writers fully engaged.
As they wrote, “Fine–so far… But then Vallas helped get that contract extended for Vancom/TransPar, again without putting it out for bid. This is where he should have paused to think.”
The editorial observed, “Even if it wasn’t a sweetheart deal, Vallas created the impression it walked and quacked like one. He personally negotiated the deal–worth $6.1 million over the last 31/2 years–and ushered it through school board approval. Maybe other vendors would not have been as qualified, but they should have had the chance to try.”
The Tribune was particularly clear about their objection.
To them and to any reasonable person, the issue was not whether Vancom did or did not do a good job. The issue was that public officials have an obligation to protect public dollars and that means utilizing a competitive bid process when it is required.
In the Vallas/Vancom case, the Tribune wrote that, “A report prepared for CPS [Chicago Public Schools] Inspector General Maribeth Vander Weele found that busing costs increased 13 percent–$11 million–over the last three years, despite a 3 percent decline in the number of students needing transportation.” The Inspector General’s study claimed that the higher costs was the result of “an inefficient routing system that has some students riding alone to school, underused computer routing software and outdated street and traffic data.”
In his defense, Vallas had his own study done which concluded that the contract actually saved the City $17 million.
But, considering the obligation Vallas had to taxpayers, his point is irrelevant.
Now, fast-forward to Bridgeport, Connecticut and the year 2012.
When confronted with questions about his decision to hire an array of consultants, many of whom worked for The Vallas Group, his private consulting company, Vallas has articulated a similar defense. According to Vallas, Bridgeport is coming out ahead, because although the consultants are being paid $500 to $900 a day, the City doesn’t have to pay for their health insurance and other benefits.
But of course, regardless of his claim, the Chicago Tribune was right twelve years ago and the concerns being raised now are equally correct.
We have competitive bidding laws for a reason. As the Tribune wrote, “Appearances Matter, Mr. Vallas.” And perhaps, even more to the point, failing to properly bid public contracts is a serious legal violation here in Connecticut.
So the question remains, when will Mayor Finch or Governor Malloy step forward and make sure that Connecticut and Bridgeport’s laws and regulations are being followed?