Harwell, Ramsey block Haslam plan to expand JLL contract by $5.3M

From the Commercial Appeal:
Less than a month after state auditors criticized the Haslam administration for the way it contracted with Chicago-based real estate giant Jones Lang LaSalle to manage state buildings, the administration wanted to expand the contract by $5.3 million — a 50 percent increase — to cover state prisons, parks and other buildings.

But the top two Republicans in the Tennessee legislature, Senate Speaker Ron Ramsey and House Speaker Beth Harwell, asked Gov. Bill Haslam’s office not to proceed with the non-bid expansion of the contract because of the controversy swirling around the two-year-old contract. The state comptroller’s office on Nov. 13 said the contract had “created organizational conflicts of interest in which the contractor could profit from its own recommendations to the state.”

So instead of an expansion and extension of the contract term, the state Department of General Services asked the State Building Commission on Thursday to approve a scaled-back amendment to the contract that “reallocates” $195,625 in previously approved funding.

The contract remains in force, however, with the company continuing to manage much of the state’s owned and leased office space.

Excerpt from The Tennessean’s story:
“We were tired of expanding, expanding, expanding without (rebidding),” Ramsey said. “I don’t want to even imply that I think there’s something wrong. There’s not. But at the same time, there has to be transparency.”

Kelly Smith, a spokeswoman for the Department of General Services, confirmed that administration officials had weighed an expansion but ultimately decided not to move forward without rebidding.

“What’s important to remember is this was just discussed,” she said. “It was not brought forth.”

The decision does little to change Jones Lang LaSalle’s relationship with the state. The firm will continue to negotiate leases for the state, and it will continue to lead the “T3 Project,” a reorganization of state office buildings. A second contract that made the Chicago-based firm the state’s property manager also was not affected.

But the vote does represent a check on the Haslam administration’s affiliation with Jones Lang LaSalle following an audit released last month by state Comptroller Justin Wilson, who sits on the State Building Commission. Haslam had invested in the company before he placed his assets in a blind trust and now says he doesn’t know whether he owns stock in JLL.

And from WTVF-TV:
“What happened? Did someone say hold on, enough?” we asked Lt. Gov. Ron Ramsey.

“Well, yes, absolutely,” he answered. “The speaker [of the House Beth Harwell] and I both spoke to them.”

At the center of the controversy is a JLL consulting contract that had ballooned to 10 times its original amount through a series of no-bid contract amendments. Despite all the controversy, the administration had still wanted to give the company millions of dollars in new work.

The real debate, according to Ramsey, occurred behind the scenes of the State Building Commission.

That contract had been increased from $1 million to almost $11 million, and the administration had recently circulated a proposed amendment to expand it to $16 million.
At the same time, administration officials had warned members of the State Building Commission about dire financial consequences if it was not approved.

“That’s the biggest thing that bothered me,” Ramsey said, “is don’t come to me on December 11th and say ‘if this is not renewed by the end of the year that the world is going to come to an end.’

“I don’t like working under those circumstances. You should have brought that to us in October.”