D.C. in the weeds over a grass-cutting contract

October 3, 2011

LORENZ INC. WON A D.C. contract for landscape and ground maintenance in 2010, promising significant savings to the District. It kept its promise; city public works officials were so pleased with the quality and cost of Lorenz’s work that they pushed this spring to renew its contract for another year. Then the mayor’s office intervened, a politically connected attorney for a rival firm weighed in and suddenly all bets were off. The saga, which is far from resolved, raises troubling questions about how Washington is doing business under the leadership of Mayor Vincent C. Gray (D) and the incumbent city council.

Lorenz, a Maryland business, was awarded a $1.7 million contract — written for 12 months with the option of four, one-year extensions — in April 2010 after the administration of then-Mayor Adrian M. Fenty decided that various city agencies were spending too much on lawn-cutting and other grounds maintenance. It consolidated all work citywide in a request for proposals that was advertised in September 2009. Lorenz scored highest in the city’s evaluation and offered the lowest price in every ward, according to information from the Department of Public Works. Lorenz’s bid represented millions of dollars of savings over the five-year period. It proposed to cut the city’s grass for half as much as that offered by Community Bridge Inc., which calls itself a Washington-based business.

Nonetheless, the city, under then-Mayor Fenty, awarded Lorenz only a contract for Wards 3 through 8, with Wards 1 and 2 going to CBI. No one we’ve talked to has been able to explain that split decision. CBI was given preference points in the bidding process because the city certified it as a local, small, disadvantaged business enterprise, but even with that leg up, its bid appeared to fall short. One source said its chief advantage was support from D.C. Council member Harry Thomas Jr. (D-Ward 5). A letter of commendation from Mr. Thomas, currently under investigation in a separate financial matter, appears on CBI’s Web site. When the council discussed the contract award on March 16, 2010, Mr. Thomas vociferously objected, arguing that the contract should go to a local company that hires city residents. Council member Mary M. Cheh (D-Ward 3) responded that “this was a proper process and the winner came out fair and square.”

This April, public works officials recommended picking up Lorenz’s option for a second year of work: “As a result of this city-wide contract, the District has achieved economies of scale (in terms of reduced pricing city-wide) and consistent service at various District locations.” The contract summary for the council rates Lorenz’s performance as excellent. Contrary to fears that had been raised by Mr. Thomas that the low price was “too good to be true,’’ Lorenz never exceeded its offered price. “I talked with the Mayor last night about the Lorenz contract. He wants to move the contract forward,” D.C. Public Works Director William O. Howland Jr. wrote in an April 28 e-mail obtained by an attorney for Lorenz in a Freedom of Information request.

But Janene Jackson, director of the mayor’s office of policy and legislative affairs, e-mailed on April 28 that “it is my understanding that the mayor does not want a complete year contract.”

A memo dated April 29 from a policy analyst in Ms. Jackson’s office about the proposed extension contains headings for “pros,” “cons,” “political concern” and “executive recommendation” — but the city government blacked out the entire text before releasing the memo under the FOIA request.

On the morning of May 2, Warner Session sent an e-mail to Rob Miller, the deputy director of the mayor’s office of policy and legislative affairs, requesting time to talk about the contract and attaching a “fact sheet” previously distributed by Mr. Thomas disparaging Lorenz and extolling CBI. Mr. Session is counsel for CBI, a contributor to Mr. Gray’s campaign and Mr. Gray’s recent appointee to the Washington Metropolitan Airport Authority. Later that day, an e-mail circulated within the mayor’s office with the subject line “Lorenz!!!” — but the version released by the mayor is, again, completely redacted.

On June 2, Lolita Alston, director of the office of legislative support for the mayor, inquired about the Lorenz contract awaiting approval and was told by Ms. Jackson, “Lorenz is not going forward.”

With the contract extension nixed, Lorenz continued to work through the summer on a month-by-month basis as it awaited a new bid solicitation. Company officers didn’t understand why their contract hadn’t been renewed but believed, based on their record, that they could win another competition. But last Friday, Lorenz received an e-mail at 8:57 p.m. from the city public works department. “Sorry to inform you that the word that we received this evening from a representative of the Mayor’s office” is that Lorenz’s work must stop immediately and “some of your September invoices may not be paid.” No such notice was sent to CBI, which, according to an administration official, had its option renewed.

Over the weekend, we sought an explanation. On Sunday night a spokesman for Mr. Gray told us that the Sept. 30 message reflected a “misunderstanding,” born of the mayor’s frustration that there had been no progress on solicitation for a new contract, which he favors in hopes of getting both a good price and a local company. Both contracts would be extended until a new bid is solicited, the spokesman said. On Monday officials told us that a late-night meeting had been scheduled to discuss the matter.

Unfortunately, this leaves a number of questions unanswered. What is it about CBI that won Mr. Thomas’s admiration? Given that over the weekend we observed that CBI maintains a modest townhouse in Washington and a far more substantial construction yard, with numerous pieces of equipment, in Prince George’s County, what is the definition of a local business? Denise Shelton, president and chief executive of CBI, said city officials would be better placed to answer our questions about their contract, but she said her firm is in compliance with all city rules and requirements.

Further: How did the civil servants in the public works department come by the “misunderstanding” that the mayor wanted to cancel the contract with Lorenz? Why would the mayor overturn his civil servants’ decision to award a contract to a low bidder in good standing? Why on earth are the mayor and city council involving themselves in a $1.7 million grass-cutting contract to begin with?

And last but not least: Why would any self-respecting business want to deal with a city that operates this way?

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