Most
egregiously, any disclosure of the audit or its findings was omitted from the DOE’s Request for
Authorization documents, despite DOE claims that the vendor’s background check
revealed nothing. See the section
of the RA on p.12 that reads: “No significant adverse information has been revealed to date” about
the vendors listed, “except as noted
below” – which then proceeds to list problems with numerous other vendors
but not this one.
The excuse offered to the NY Post reporter? “A DOE spokesman said the omission was an
error.”
Since the Custom
Computer Specialist scandal, it is unclear that
the DOE has shaped up its act as regards awarding contracts in a responsible fashion. In fact, the following serious
issues with DOE’s procurement process have recently surfaced:
·
As reported
on Sunday, Panel members who speak up against
egregious contracts are bullied and shunned by the DOE. This was the experience of Robert Powell, the
lone member to vote against the egregious CCS contract,. This company was originally slated
to receive $1.1B contract from DOE despite having
been involved in a multi-million kickback scheme,. Powell recently resigned
from the Panel as a result.
·
Though the CCS contract was later
rejected by City Hall after the PEP approved it, and rebid
saving of hundreds of millions of dollars, it was just revealed that the
company still has several active contracts with the DOE. In fact, CCS has received $21.5 million
since May 2011, when the special investigator issued his report revealing the company’s collusion with Ross
Lanham, who later went to jail for stealing millions from DOE.
·
There continue to be numerous contracts
in which the DOE asks the PEP for retroactive
approval, after the services have been provided
and the funds have already been spent.
·
The DOE has proposed to get around
the contracting rules by reimbursing
a private organization that had paid preK vendors,
presumably because their records were too spotty to be approved for city
contracts in the first place.
·
There are numerous proposed contracts
submitted to the PEP without background checks and/or checks
that reveal that the vendors had previously
engaged in fraud or other improper behavior.
·
There are many contracts for which DOE either minimizes the problems with the vendors' previous performance (as, for example, with CCS or Pearson
contracts) or in which DOE entirely omits
information of past improprieties, as in the case of Yeled v’Yalda.
· There are numerous contracts
-- either sole source or competitive - which provide no evidence that any
quality control or cost-benefit analyses by DOE – for example, in the Amazon
contract and the vast majority of PD and
curriculum contracts.
Despite all these problems, the DOE proposed contracts, amounting to hundreds of millions of dollars, are often unanimously approved at Panel meetings with little or no discussion or debate.
Despite all these problems, the DOE proposed contracts, amounting to hundreds of millions of dollars, are often unanimously approved at Panel meetings with little or no discussion or debate.
·
The DOE
also has refused to comply with the state law requiring financial
training for Panel members, even after Isaac Carmignani, a current Panel member
and mayoral appointee, asked for such training.
Here
is a link to the 2005
state law, which is quite detailed and mandates
that at least six hours of training be
provided all school board members on their "financial oversight, accountability and fiduciary
responsibilities.” The law also requires
that an internal audit committee be formed, which must hold regular meetings to
address “any indications of suspected fraud, waste or abuse,” among other
responsibilities.
NYC
is exempt from the mandate as long as there is financial training and an audit committee “that meets or exceeds these
requirements.” Yet according to current
and past Panel members, there is no real financial training and no audit
committee exists.
Now that at least two past Panel members –
including Bronx rep Robert Powell and former mayoral appointee Norm Fruchter – agree that
the current system creates no real checks and balances, what is the answer?
Certainly Panel members should all receive
their legally mandated six hours of financial training, but is that
enough? Please offer your views below.
If others want to take a look at the
contracts up for a vote on May 18, they
are here.
If you have comments or want to join
our Committee, please email NYCschoolcontractwatch@gmail.com.
thanks! Leonie
