City bails out of state compliance board contest — leaves me with last word

Normally a contest at the state attorney-general’s Open Meetings Compliance Board goes four rounds: (1) Complaint (2) Response by City to Complaint. (3) Complainant’s Comment on City Response (4) The Final Words — from the City.  But on this occasion the City bailed out in the final round, taking only 15 minutes to inform the state Board. Naturally my immediate thought was: “I made such a great case, they had no comeback,” Then moments later: “Perhaps the attempt to refute me would take too much effort, and take staff away from other promised work.” Of course they may have thought I did such a lousy job they didn’t need to pile on? But what matters is what the state Board thinks and it is often said such bodies are reluctant to side with a lone citizen complainant against  a local government body. Who knows.

Regardless, of one thing I’m certain. A few City officials engaged in classic contract corruption in steering the hotel project to Plamondon. A number of good people are in denial. They are embarrassed because they didn’t see it at the time. Some just don’t want to know. Others say it’s years ago now, ‘history’ they say. I’ve also heard people say fatalistically: “It’s just the way the City works. It’s always been like this. It’s who you know.” No one makes the case it was fairly competed. No one.

The evidence of a scam on competitors and taxpayers is overwhelming:

— Plamondon himself has said he and Richard Griffin got the project launched as City sponsored

— Plamondon  and Griffin were always active in the Hotel Advisory Committee (HAC) beginning life as an informal Chamber of Commerce lobby group for the project, then made Mayor McClement’s hotel project team in 2009/10

— Plamondon was on the inside of the project from early days and was a member and introduced as such at a Mayor & Board meeting as late as February 2013

Pete Plamondon

— taking advantage of insider knowledge the Plamondon hotel proposal was with the HAC and worked on by HAC/City consultant JLL by Dec 2013 a couple of months before the RFP was even issued Feb 2013

—the switch from a competition-friendly two-stage procurement as outlined in the summer of 2013 to the quickie 6-week single-stage bring-your-site procurement of February 2014 gave those like Plamondon with inside knowledge and one of the four approved sites a huge advantage

— scoring of the two proposals was heavily biased against Plamondon’s competitor

— proposed complex is valued at $30m on completion based on the City’s consultant MuniCap making the expenditure of $80m+ a gross waste and a recipe for financial disaster

— the site is so ill-suited by way of lack of street frontage to a hotel complex of the size they still haven’t worked out access to the parking  garage, deliveries or trash pickup (the PO and Galleria sites nearby are way superior)

My complaint is posted here:

http://frederickhotelboondoggle.us/2018/03/complaint-to-state-open-meetings-compliance-board-about-backroom-deal-on-city-procurement/

The City Attorney’s Response of four pages focussed its criticism heavily on a side-issue of my Complaint — the City Purchasing Manual’s apparent requirement that all RFPs or other solicitations over $50,000 be approved by the Mayor & Board. The language of the Manual is sloppily written and on reading their reasoning I concede, not that

Saundra Nickols, City Attorney

there’s any right interpretation but that it can be read either way. And most RFPs don’t get referred to the Board of Aldermen, I guess because they are the kind of regular purchases authorized in the last annual budget.

But the hotel RFP deserved close scrutiny by Aldermen because on July 31, 2013 they were offered a Workshop presentation on the planned procurement and promised a later one, which never eventuated as a public meeting. The Frederick News-Post reported that the followup meeting might be a closed meeting. With the format the procurement changing from a competition-friendly design to  highly restrictive format the Aldermen should have met to hear the argument for that change. 

The City Attorney also claimed it couldn’t address any violation of the Act in closed meetings because I hadn’t given details of the date and the action. That’s a no-win argument. If a meeting is secret then by definition those excluded from it won’t know when it occurred. Under the Open Meetings Act a public body like the Mayor & Board of Aldermen are allowed to go into closed session to discuss certain listed topics — purchase of property, personnel matters, negotiating strategy etc — but they have to vote first for the closed session and put on the public record a statement of the topic of the closed meeting.  They’ve never done that on the hotel.

The City Response relied heavily on a  lawyerly kind of pseudo-denial. The city response included am affidavit of Richard Griffin, key sentence being: “I have neither convened nor participated in any meeting of the Board of Aldermen regarding the issuance of RFP#14-J or any other matter related to plans for a hotel and conference center in  downtown Frederick that was not conducted fully in compliance with the Maryland Open Meetings Act.”

Of course that is not a denial of closed meetings. It that leaves open the possibility of closed meetings, just that such closed meetings as may have occurred were in compliance with, or allowable under the Act.

Here is a copy of the City Response:

COFresponse20180413

My COMMENT on City of Frederick Attorney’s Response to my Complaint of March 28, 2018 against the City of Frederick Mayor & Board of Aldermen, Downtown Hotel project

Open Meetings Compliance Board, c/o Janice Clark and Ann MacNeille, Counsel, opengov@oag.state.md.us

2018/04/20

BACKGROUND: The City of Frederick’s Downtown Hotel is a serious scandal which was concealed at the time by officials meeting behind closed doors in violation, I submit, of the Open Meetings Act. At the last public meeting before the issuance of the Request for Proposals (RFP14J February 19, 2014) a competition-friendly procurement procedure was presented at a public Mayor & Board of Aldermen Workshop July 31, 2013. Both printed/pdf materials and the spoken narrative envisaged a two-stage procurement — the City choosing a site and gaining legal ‘control’ over it by purchase or, more likely, by a conditional contract-to-buy; then in the second stage open competition among hotel developers making their best proposals based on the City site for the privilege of being able to draw on substantial City, County and State upfront money (about $30 million on last accounting.)

In the seven months between the Workshop presentation and the release of the RFP City officials contrived, behind closed doors, to jettison that publicly presented and promised competitive procurement in favor of a highly restrictive solicitation whose rules restricted competition to the ultimate winner and a straw ‘competitor.’ The ultimate winner Pete Plamondon Jr of the Plamondon companies and Richard Griffin, director of the City Department of Economic Development have been the two principal activists advancing (albeit at glacial speed) this project starting in November 2005. Plamondon has said he called Griffin immediately he read the news that the State Highway Administration was set to start construction of the new East Street interchange on I-70 promising a new ‘gateway’ to the eastside of the City where hotel sites were located and said to him: “Now we can talk seriously about a downtown hotel.” (recounted by Plamondon April 13, 2016) According to Earl Robbins the chairman of the Hotel Advisory Committee (HAC) Plamondon himself was a member of the insider HAC promoting the hotel as late as February 2013 when it was considering sites and specifying the features of the hotel on behalf of the City. Toward the end of 2013 Plamondon had a first draft of his proposal in the hands of the HAC as evidenced by invoice time-sheets of consultants from Jones Lang LaSalle (JLL), who were simultaneously working on the RFP. The fake nature of the competition conducted by the HAC on behalf of the City was clear in the restrictive nature of RFP14J as compared to the competition-friendly two-stage approach previously presented, then dumped without any public discussion. Apart from the bring-an-approved site requirement, there was the very short period — 6 weeks — from the release of the RFP to the deadline for submission of proposals. This alone almost precluded any proposer without inside knowledge getting a bid done in time. 

We are dealing with a clearcut case of a fake competed procurement enabled by violations of the Open Meetings Act via (1) outsourcing to a closed-door Hotel Advisory Committee (HAC) the specification of the hotel, control of the procurement, and scoring of the proposals (2) misleading the public with a description of a competition-friendly two-stage procurement then going to closed meetings to authorize the single-stage restricted competition.

City Purchasing Policies & Procedures or Purchasing Manual

Taken on its face the City’s written purchasing manual does require Board of Aldermen approval of solicitations over $50,000. In my Complaint I cited page 36 which suggests that for projects over $50,000 “the solicitation documents along with all backup” be submitted for review, then “This item with supporting material shall be placed on a public meeting agenda for approval by the Mayor and Board of Aldermen.”  There is more.  On page 25 under the heading “Competitive Invitation to Bid (ITB) Request for Proposal (RFP), Request for Qualifications (RFQ)” the Manual reads: “All purchases for commodities or services that have a cumulative total for life of the contract of $50,000 or more must be made by formal competitive solicitations. The approval of the Board of Aldermen is required.” The sentence saying approval of the board of aldermen “is required” follows directly on the word ‘solicitations’ and so logically it is the solicitations that must be approved by aldermen. If the drafters meant that aldermen need only approve the purchase after the solicitation, say at the time a contract was ready to be signed, then the last sentence would read: “The approval of the Board of Aldermen is required before a contract is signed.” As it reads without the bolded clause the plain meaning, I submit, is that the solicitation (or RFP) must be approved by the Board of Aldermen.

For citizens and taxpayers, the City’s purchasing manual is useful only to the extent it is used by City officials to promote open competition for provision of goods and services. If the City Attorney and other executive branch officials view ambiguities of language as loopholes enabling them to avoid conducting a competitive procurement then they are colluding to allow cronyist exploitation of taxpayers for the benefit of insiders. They are thwarting the competitive intent of the City purchasing manual.

City practice

The City Attorney does have a point that in recent years the Board of Aldermen do not seem to have been reviewing many RFPs before their issuance, although many of those cited by her would be below the $50,000 threshold that in my reading triggers the requirement for Aldermanic review. But the practice for regular, straightforward purchases is not relevant to review of the Downtown Hotel project solicitation. The hotel project’s huge cost, its complexity and its unusual nature made public review of the solicitation process essential. That was conceded by proponents and skeptics alike. And so there was some review of the solicitation in its consideration at the Workshop of the Mayor & Board July 31, 2013. That night the proposed hotel solicitation was one item of several on a long evening and a followup meeting to discuss the hotel solicitation further was promised by the HAC chair Earl Robbins — twice. It was also promised by John Gibb of JLL. And a followup meeting was reported planned in the Frederick News-Post.

The second reason why there needed to be the followup public meeting was that the HAC decided after July 31, 2013 to change the form of the solicitation from the competition-friendly two-stage procurement presented at that forum to a highly restrictive insider-friendly single-stage procurement. 

Meetings did occur

Some followup meetings did occur, we know. Of the five aldermen of 2013 (M O’Connor, K Young, S Aloi, C Krimm, and K Russell) the first three have acknowledged there were followup meetings, the last two

Michael O’Connor

have not, at time of writing, responded to my questions. Aloi has said there were several followup meetings with HAC secretary and City Department of Economic Development director Richard Griffin. Griffin himself has provided you with an affidavit which states that he did not convene or participate in any meeting related to the hotel “that was not conducted in full compliance with the Maryland Open Meetings Act.” Similarly, O’Connor and Young say that no meetings they attended were in violation of the Open Meetings Act. Those statements are not a denial that private or closed meetings occurred. They are simply assertions without evidence or argument that such private meetings as may have occurred to discuss the hotel procurement were in compliance with the Open Meetings Act. 

Such assertions beg the whole question being put to this Compliance Board. The Compliance Board is asked by my Complaint to rule on whether private meetings on the hotel procurement were in compliance with, or in violation of the Open Meetings Act. 

One follow-up private meeting was predicted at the time. The Frederick News-Post in its report of the July 31, 2013 workshop meeting concluded with this sentence: “The city’s hotel committee plans to present to elected officials in a few week(s) preferred sites for the hotel, although the public may not be included in that discussion.” (Frederick News-Post August 1, 2013).

Under the proposed two-stage procurement outlined at the July 31 Workshop the City would conduct negotiations with the owners of four favored hotel sites on the eastside of downtown. The Open Meetings Act at § 3-305. CLOSED SESSIONS (b) (1) (3) specifically allows going into closed session to discuss “acquisition of real property.”

There is no record in meetings subsequent to the July 31 Workshop of any vote by the Board of Aldermen to go into closed session or any statement of the subject matter of such meetings as required by the Act. § 3-104. MINUTES FOR CLOSED SESSION. Without such a vote and such statements of the topic of the closed meeting, such meeting is in itself a violation of the Open Meetings Act, as I read it.

The larger issue that deserved open, public discussion was the decision to dump the competition-friendly two-stage procurement outlined at the July 31, 2013 public Workshop meeting for the insider-favoring, single stage procurement that emerged from the City Purchasing Office as RFP14J February 19, 2014.

Richard Griffin

On March 24, I requested under the Public Information Act “copies of communications between the City Department of Economic Development and the City Purchasing Office relating to solicitation of proposals for a downtown hotel (which became RFP14J) in the months prior to its issuance (Feb 19, 2014.)” I said: “I am looking in particular for any reference to authority to issue the RFP14J solicitation.”

These communications should provide evidence of meetings held to discuss the form of the hotel solicitation or people consulted. At time of writing the City has not responded. 

It is possible in such communications that Griffin cites the Hotel Advisory Committee (HAC) as the main source of his authority to ask the Purchasing Office to structure the RFP as the insider-only single-stage quickie procurement which emerged. At that time the HAC was being characterized as a City advisory body created and controlled by the Mayor with staff work out of the City Department of Economic Development – essentially a city body. So, the City Purchasing Office might quite reasonably have seen HAC endorsement as adequate authority in 2013/2014. 

But last November faced with my earlier Complaint to you (11OMCB90-2017) about the closed-door operations of the HAC the City Attorney gave you the line that it was not a ‘public body’ of the City, but merely a creature of the local Chamber of Commerce, and therefore exempt from the requirements of the Open Meetings Act. Our City Attorney would now be saying that City government in Frederick fully delegated to a local Chamber of Commerce body the power to conduct an insider crony deal with $30 million in City, County and State taxpayer money. This after the Board of Aldermen and the public had been told there would be a competition-friendly two-stage procurement.

Conclusion

None of these City Hall shenanigans would, I submit, have been possible without extensive closed-door activity in flagrant violation of the Open Meetings Act. I ask you to find that the City of Frederick has conducted important public business in connection with its sponsorship of the Downtown Hotel behind closed doors in violation of the state Open Meetings Act.

Peter Samuel, Frederick

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