Tag Archives: procurement

Dispute develops over awarding multi-million-dollar state radio communications contract

The state Department of General Services is in the process of awarding a new five-year contract, potentially worth millions of dollars, for all radio communications equipment and its maintenance, repairs, parts and accessories – and some of those considering bids are suggesting the deck is stacked in favor of one company.

Further from Richard Locker’s report:

The state’s procurement process flared briefly into controversy during a conference with potential bidders Sept. 4 when a vendor suggested the current contractor appeared to have drafted some of the procurement documents. The vendor made the assertion after clicking on the “properties” tab of a computer file among the documents given to vendors for review, which listed as its “author” the Tennessee sales representative for Motorola Solutions Inc., the current contractor. The conference ended as other vendors asked about the fairness of the process.

But spokesmen for Motorola and the state Department of General Services said the company had no role in drafting the documents and that the assertion was based on a misunderstanding.

…(S)ome potential vendors say only Motorola, the industry giant in public-service radio equipment, could qualify for several of the nine categories of radio equipment for which contracts will be awarded under the current draft requirements. The state plans to award a single contract for each category, and each category has sub-categories of radio equipment.

Some vendors have written to the department’s Central Procurement Office asking to consider multiple contracts for each category, which would allow more vendors to bid, increasing cost competition. Some vendors meet the specifications for some sub-categories but cannot bid on the full category because they don’t manufacture all the radios in all the sub-categories.

The General Services Department says it is considering that request.

Note: Motorola Soultions Inc. has provided $17,500 in corporate contributions during the 2013-14 election cycle to the Senate Republican Caucus, the House Republican Caucus and political action committees operated by Lt. Gov. Ron Ramsey, Senate Majority Leader Mark Norris and Senate Republican Caucus Chairman Bill Ketron. The company also operates a national PAC registered in Tennessee. It’s only Tennessee donation reported this cycle is $2,500 to Gov. Bill Haslam.

New State Procurement Office Claims Savings of $113 Million

While the head of Tennessee’s newly centralized procurement system provided examples to legislators of savings to taxpayers last week, declaring they collectively total $113 million to day, state Rep. Jeremy Faison offered another example that didn’t sound so good.
Chief Procurement Officer Mike Perry’s examples included a dozen “ballpoint stick pens” that previously cost the state $1.55 for a box of a dozen versus 47 cents today and a ream of paper, previously $3.10, now $2.77.
Office supplies counted for $8 million of the projected $113 million in savings, a figure that includes comparing new multiyear contracts with old ones as well as some one-time purchases. The biggest projected savings, $33 million, was on Oracle software through “strategic sourcing,” which involves negotiating with current contract holders.
In the latter case, the vendor initially said that new software needed to bring TennCare computers into compliance with new provisions of federal law would cost $39 million, Perry said. After the negotiation, the price was $6 million.

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Personal Relationships a ‘Common Thread’ in State Contracts?

A board composed of three state officials has upheld the Department of Correction’s award of a $241 million contract to a company that employs Correction Commissioner Derrick Schofield’s wife, though its bid was more than $15 million higher than a competitor.
The decision of the state Procurement Office’s “protests board” was announced to members of the Legislature’s Fiscal Review Committee, some of whom have separately raised questions about the contract for providing medical services to inmates in the state prison system.
But because of what Chairman Bill Ketron described as “a squirrley situation,” no questions were asked at the panel’s meetings this week and the committee instead approved a temporary extension of the current contract, which is scheduled to expire at the end of this month.
The panel also put off inquiries into two other state contracts that Ketron said have at least the appearance of a “common thread” in that they were awarded to companies that have some connection to government insiders.

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Haslam: ‘We Keep Chipping Away to Make It Cheaper’

Andrea Zelinski has done a TNReport on state cost-cutting ideas, including TSEA’s solicitation of suggestions from state workers and Gov. Bill Haslam’s plans to implement a new procurement system.
(Legislation setting up the new procurement plan was passed at the behest of Comptroller Justin Wilson during the last year of former Gov. Phil Bredesen’s administration. With Haslam’s approval, implementation was delayed by a bill passed in the Legislature this year.)
The governor also supports restructuring the state’s purchasing practices — a reform that has saved the state of Indiana as much as $57 million since 2006.
The main idea there is to leverage for lower prices on bulk purchases like office supplies and computers by buying the items for all state agencies at once, said Nicole Kenney, Indiana’s deputy commissioner of procurement. Officials then negotiate multiple times over one contract to ink a deal for a lower price than what the vendor originally proposed.
Before, “you didn’t even question the price,” explained Kenney. Now, “we squeeze them as much as we can until they stop moving and we can’t do any better,” she said.
Savings could take years to build up, said General Services Commissioner Steve Cates, who is in charge of managing the state’s property.
“I have found areas that have almost 150 unique contracts doing the same thing,” he said. “You could have a lot fewer contracts and work on benchmarking with where the best prices are.” Meanwhile, his office is also brainstorming ways to better manage the state’s 6 million square feet of owned and leased office space.
If the state can save $1 or so per square foot a year, that’s millions of dollars in the bank, Haslam said.
“None of (these ideas) were something if you were on a campaign you’d run on, but all of them you go, ‘Oh, they make sense,'” Haslam told TNReport. “We keep chipping away to make it cheaper.”
The commissioner said he was not aware the TSEA hopes to propose a cost-savings action plan of its own, which is set for release in January.

Comptroller Pushes New Procurement System

State Comptroller Justin Wilson is backing legislation that would drastically overhaul the state’s system of procuring goods and services through contracts.
Modeled after Georgia’s procurement system, initiated under Republican Gov. Sonny Purdue, Tennessee’s bill (HB3353) is sponsored in the Senate by Sen. Bill Ketron, R-Murfreesboro, chairman of the Fiscal Review Committee, and in the House by Rep. Charles Curtiss, D-Sparta, former chairman of the legislative watchdog panel.
As things stand now, according to Wilson and the sponsors, the state has a convoluted and confusing system for contracting with businesses and individuals for goods and services.
But, of course, there are also some misgivings about the proposal – starting with the late kickoff for passage in this year’s session of the General Assembly.
Full story HERE.