Philly looks to change standards for awarding public works contracts

City Council unanimously voted Thursday to give residents the opportunity to vote on a proposed City Charter change that is already under attack for allegedly widening opportunities for corruption.

City Councilman Bobby Henon introduced a bill which will ask voters in May to approve a change to the charter to allow city public works contracts to be awarded on a “best value” standard, instead of the current “lowest bidder” policy.

“As far as the last and loudest criticism about best value, that it opens the door to cronyism and pay-to-play politics, I can say the following: this process will be transparent and open at every turn,” Henon said during the council meeting. “Despite the claims of some, and I am proud to say this, best value is good policy.”

Henon introduced the bill on behalf of the administration of Mayor Jim Kenney.

Out of the 20 largest cities in the country, only two — Philadelphia and Indianapolis — require public works contracts to be issued to the “lowest bidder,” according to the city. The low-bid standard may be hurting the city’s procurement of bidders to work on various public works contracts, they claim.

“The lowest bid price, our current practice, does not necessarily lead to the lowest final cost to the city, or the best use of public dollars,” Philadelphia Chief Administrative Officer Rebecca Rhynhart testified at a Nov. 22 City Council hearing on the bill. “Best value will allow the city to get the most value for every dollar we spend.”

Rhynhart said a “best value” standard would allow the city to consider other criteria, such as on-time, on-budget performance; minority, woman, or disabled-owned business enterprise participation goals, and project schedule and approach.

The bill came under attack before it went before council for a vote. Jay McCalla,former deputy managing director under mayors Ed Rendell and John Street, assailed the bill inan Inquirer opinion pieceearlier this week entitled “City Council bill widens door to corruption.”

McCalla argued that “the venerated standard of ‘low bidder’” is “objective,” while under the new standard, “these men [Mayor Jim Kenney and Councilman Bobby Henon]are swinging open the door to political pressure in an arena that has been admirably free of it.”

“The bill would provide the Kenney administration with the tools to steer contracts to donors or other favored firms, substantially increasing an ability to fundraise,” he continued. “The universe for backroom favor-trading would have radically expanded, with the additional benefit of being able to punish nonunion vendors.”

However, the bill states that low bidders will still get contracts unless the city determines a different bidder offers a better value.

Henon argued that the charter change will “open up procurement projects to small vendors that haven’t bid for city contracts before … vendors who couldn’t compete with bigger businesses that can do the job for cheaper, though not necessarily better.”

Voters will get the final say on whether they support changing the standard or not in May.

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