By Nikita Stewart
Washington Post Staff Writer
Sunday, January 17, 2010; C01
D.C. Council Chairman Vincent C. Gray will ask his colleagues Tuesday to stand down on a threat to stop payment on $875 million in contracts Mayor Adrian M. Fenty's administration entered into last year but did not submit to the council for approval.
The council unanimously approved emergency legislation to stop payment on the contracts at midnight Wednesday if they are not ratified by the council, a bold action that was supposed to force the Fenty administration to submit the contracts. The deadline for submission expired at noon Thursday, and Fenty (D) did not sign the council's legislation, a tacit disapproval.
The Home Rule Act requires contracts exceeding $1 million to be approved by the council, but Attorney General Peter Nickles has said he does not believe that the act applies to certain types of contracts, such as option-year agreements. In the case of the $875 million in contracts, he wants a written guarantee that the council will retroactively ratify them "en masse" before the administration submits them. Gray (D) said he cannot give that assurance because he has not seen all of them and cannot speak for the full council.
The disagreement has created a deadlock. But in a letter to Fenty on Friday, Gray said that because progress is being made, he is willing to propose new deadlines of Jan. 26 for the submission and Feb. 2 for ratification.
"With the 12-day extension I am proposing, I believe the Council has done everything possible to resolve this situation in a collaborative manner," Gray wrote.
Gray and Nickles could not be reached immediately to comment.
But in an interview earlier in the week, Nickles said that his interpretation of the law is accurate and that the council is putting the city's finances and credibility in jeopardy. "It's sort of a game of chicken: 'Give the information to us so we can prove we're king of the block,' " Nickles said.
The dispute arose from controversial recreation contracts awarded to firms with ties to Fenty. In October, the council learned that the administration funneled millions of dollars to the independent D.C. Housing Authority, a transfer the council says circumvented its authority to approve contracts over $1 million.
Nickles acknowledged that such contracts should be sent to the council, although he said the construction contracts are legal and binding. Soon after the October revelation, Gray's office realized that the administration had stopped submitting other $1 million-plus actions, namely option-year contracts and task orders issued under contracts known as IDIQs, or indefinite delivery indefinite quantity.
In both types of contracts, the goals are to give agencies some discretion and power to negotiate for the government in a timely manner and to get the best deal, procurement experts said.
In previous administrations, the contracts were submitted and the council generally approved. But Nickles decided in December 2008 that the administration no longer had to do so and instructed agency directors of the revised policy. He said there is no need for council approval, because option-year renewals and task orders are actions that take place after an initial "base contract" is approved.
He also said the practice of sending the contracts to the council had been inconsistent. "A lot of agencies didn't. It was an erratic process," he said.
Nickles said he was also concerned that council member Marion Barry (D-Ward 8) kept proposing disapproval resolutions on such contracts, putting payments in limbo. He said the council was informed on Dec. 31, 2008, that he would institute the new policy but did not push back until October.
Since then, the council uniformly has demanded to see all contracts, but the latest standstill has caused consternation. Some council members and city officials are hoping that Gray's compromise to give the administration more time to submit the contracts will lead to a permanent solution. Chief Financial Officer Natwar M. Gandhi has urged both sides to find middle ground. Council member Jack Evans (D-Ward 2), chairman of the Committee on Finance and Revenue, has also worked to reach a consensus.
"I'm glad to see that the chairman and the attorney general are working toward a solution," Evans said Friday after learning of Gray's plan.
Barry was less conciliatory.
He said the latest dispute is another example of Nickles interpreting the law as he sees fit.
"I'm shocked that Peter Nickles, as a lawyer, would want to break the law," he said. "I'm willing to make them obey the law. If the government shuts down, it's at the feet of Peter Nickles and Mayor Adrian Fenty. I'm tired of it."