Lawmakers should limit governor's ability to award no-bid contracts
Legislation that would prevent Pennsylvania governors from issuing no-bid contracts greater than $100,000 without close scrutiny is long overdue.
The importance of such legislation is apparent in the wake of the disclosure that Gov. Ed Rendell has awarded more than $1 billion in no-bid contracts since taking office in 2003.
Legislation to address the issue is in the process of being written, according to House Minority Policy Chairman Mike Turzai, R-Allegheny.
Meanwhile, state Senate Majority Whip Jane Orie, R-Allegheny, has co-sponsored a bill modeled after a Philadelphia law that makes businesses ineligible for no-bid contracts if they contribute more than $10,000 a year to a city official's campaign.
While there apparently is no evidence on which to accuse Rendell of a violation of state law in connection with the no-bid contracts, the question that should be on the minds of state residents is how much the state might have saved if the administration had sought bids for some of the services or items purchased without bidding.
That's the chief objective behind competitive bidding — to obtain the best price for the item or service being bought.
In no way can Rendell assure state taxpayers that they got the best bargain available in all cases by way of the no-bid pacts.
The taxpayers also have grounds for concern about the no-bid contracts awarded by Rendell's predecessors, since records of those purchases apparently have disappeared. The unavailability of those records became known when the Department of General Services was gathering Rendell no-bid data to fill a request by a Pittsburgh newspaper.
Although most state contracts must be competitively bid, state officials are permitted to award contracts without bidding when it is deemed "in the best interest of the commonwealth." Among other exceptions are when federal or state law specifically exempts the contract or when only a single supplier is capable of providing the product or service.
But lawmakers on both sides of the legislative aisle are right in having criticized Rendell's hiring of his former law firm for $1.8 million for work tied to the proposal to lease the Pennsylvania Turnpike to a private company.
Rendell defended the hiring, saying the law firm, two partners of which are former Rendell aides, is qualified because it has experience in tax-related issues. However, there must be other law firms in the state with similar experience and qualifications, some of which might have been willing to do the Turnpike-related work for less than what Rendell agreed to pay.
Similar concerns are justified in regard to a $400 million contract extension approved by the governor for the Unisys Corp. of Blue Bell, Montgomery County, for managing the state's data center. Rendell said the extension "makes good business sense" and will save taxpayers at least $240 million over five years.
However, neither the governor nor the taxpayers can be sure it's the best deal — without the contract having been put out for bids. Some other company might have been able to provide a savings in excess of what Unisys promises. We'll never know.
Likewise, the Rendell administration has given its OK to a big contract for medical services for inmates, as well as one for telecommunication services — also without advertising for bids.
State taxpayers deserve the most bang for their buck, and Rendell should strive for that end in all of his undertakings. That there is good reason to believe that the governor has not always gotten the best deal possible as a result of his penchant for approving contracts without bidding makes the closer-scrutiny legislation being written very meaningful.
In some ways, state lawmakers have become more sensitive to taxpayers' wishes and best interests since the firestorm of voter anger stemming from the middle-of-the-night pay-raise vote of July 2005 and the anti-incumbent ballot-box statement in the legislative elections of 2006.
This also being a legislative election year would be a good time for lawmakers to put curbs on no-bid contracts to rein in not only Rendell, but his successors in the state's top executive office as well.
Competitive bidding makes the most sense from a price standpoint. It also carries with it the freedom from allegations that a purchase is a political payback.
"What is beyond the pale is the level at which the Rendell administration has engaged in this (no-bid contracts)," said state Rep. Doug Reichley, R-Lehigh, the Republican Caucus' point man on contract issues.
"Blatant" is an appropriate adjective.
