Is “best value” contracting the next, new thing for the City of Philadelphia?
The Philadelphia City Council recently passed a resolution proposing an amendment to the Philadelphia Home Rule Charter that would give the Procurement Department the option to award contracts, which are normally awarded to the lowest, responsible bidder, to “the responsible bidder whose proposal provides the City with the best value.” This amendment would radically alter a provision in Article VIII, Chapter 2, of the Charter that has been in place since the Charter was first enacted in 1952.
If passed by the voters, the amendment will add a new subsection to section 8-200 of the Charter which will read as follows:
(5) In lieu of awarding a contract to the lowest responsible bidder, the Procurement Department may award a contract to the responsible bidder whose proposal provides the City with the best value, only when the Procurement Commissioner has determined in writing that award to the lowest responsible bidder may not yield the best value to the City because the goods, construction, alterations, repairs, maintenance or other services that are the subject of the award have qualitative characteristics that make them better suited to an open, competitive solicitation of proposals. Such characteristics may include the integration of technical or professional service elements, quality differences among proprietary products and services, incorporation of City contracting objectives, including but not limited to, participation in City contracts by disadvantaged business enterprises pursuant to Article 6-109 of this Charter (related to participation goals), or other attributes that make price alone a poor indicator of best value. In such instances, the award of the contract shall be subject to any applicable process established by City Council pursuant to subsection (1), above, applicable generally to contracts not subject to the lowest responsible bidder requirement; and the awarding decision shall be made according to criteria established by the Procurement Department by regulation. For contracts involving an expenditure in excess of the amount set forth in subsection (2), above, as adjusted, the applicable criteria shall be set forth in any solicitation for proposals
Of course, as always, the devil is in the details. What will be the criteria for “best value”? How subjective will the “best value” criteria be? Who will evaluate the “best value” criteria? How will the possibility of favoritism or corruption be guarded against? And, most importantly, if all bidders are equally qualified and competent to perform the contract in question, why isn’t price always the best indicator of “best value”? These are all important questions that have yet to be fully answered. I, for one, remain unconvinced that the City’s current procurement model is incapable of providing the City with the “best value,” without subjecting the process to subjective evaluations that have the potential to introduce arbitrariness, favoritism, and corruption into a process that is now relatively untainted by such evils.
The Philadelphia Inquirer Editorial Board has weighed in against the proposed Charter amendment, with an editorial here.
A former staffer in the Rendell and Street mayoral administrations has also weighed in against the Charter amendment, with an op-ed in the Philadelphia Inquirer here.
The full City Council resolution can be found here.
Christopher I. McCabe, Esq.
