Thank you, Mr. President. I yield to Coucilman Goode.
I'm not ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 301 the President.
We're concerned about the same set of issues. I yield to Councilman Goode.
The Chair recognizes I think Councilman -- oh. You want to --
All right. All right. Let's do that. COUNCELMAN GOODE: Just two quick questions. Following up on the other line of questioning, on your largest contract, you said you did not know what the goal is set in the RFP, but the goal in the contract was 19 percent. 20 What was the actual 21 participation rate? 22
I would have to check with the Office of Economic Opportunity on what -- the actual ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 302 participation, or the department. Over the last four years you're referring to, sir?
I told the Budget Director and everyone else that my line of questioning would be around the largest contract. I'm expecting every department to come here with information on their largest contract.
I agree with you. We're fortunate to have the airport's contract, but we still try and work with them and come up with their goals. As I said before, I believe that four years ago the contract and ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 303 bid, not the RFP, I believe it came at 29 percent, but I'm sure that that got totally thrown out because a lot of vendors or a lot --
My question is -- my question was: What is the participation rate?
And Councilman, if I may, Brian Abernathy, Chief of Staff and Managing Director. I think part of the -- the disconnect here is Procurement, for the most, acts as a vehicle for departments, and so certainly our departments aren't prepared to answer your questions that were previously provided to the Budget Director. The Procurement Department is prepared for contracts that they service, but not necessarily --
-- contracts that they actually do. ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 304
Mr. Abernathy. Departments actually do their own procurement, except for the city-wide buys. My question was: What was the largest city-wide buy in terms of the service, supply and equipment, so it's a fair question if -- if the Procurement Department actually handled the procurement of that contract. If they didn't handle it, then the question is not to them. But my original question was: What is the largest SSE contract that you expect for Fiscal Year 13? So it --
I have an answer to that question, sir. It will be the summer lunch and after school snack program.
So you ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 305 answered the question wrong the first time around?
Well, I thought you just meant the largest contract that we ever handled whatsoever. Now I understand better what you're asking. And that would be the largest city-wide contract. We still --
Excuse me. For the record, how much was that summer lunch contract?
It went to Maramont Corporation which has been the same company for many many years. It's a huge --
I'm not mistaken, New York, but I'm not positive. The biggest problem with ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 306 this contract is it's governed by federal regulations which are extremely hard to meet and must be met or else the cancel the whole thing, and you have no summer lunch.
Am I hearing you say that when it comes to a catering contract --
Allow me to finish. -- that we cannot find in the City of Philadelphia out of dozens of caterers I know exist who are prepared and have the capacity to meet this particular contract you're stipulating? Is that what you're saying?
First of all, I don't really consider it a catering ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 307 contract. This is a huge, huge program which goes to every single rec center twice a day. The food has to be a certain temperature when it arrives. It has to be packed in certain way. And nobody from the City of Philadelphia, to my knowledge, has ever bid this project or is -- if they're capable of it, that's great. I hope they're out there and hope they come and bid but --
So let's flip -- let's flip the equation. If we are serious about making sure that folks who live here, businesses who reside here, citizens who pay taxes here gain access to opportunity, the flip side of the question when it comes to leadership is, and what type of outreach have you done and our agency done to your department done, to make folks aware and to help them move to capacity so that they can take advantage of these ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 308 types of opportunities?
Ma'am, we put it -- we put the bid out on the street and we advertise and we tell everybody, but they -- I'm not sure what else you want us to respond to the --
The reason I raised that, because I share your angst. The largest Procurement contract that our city has goes to a firm in New York. Now, granted --
-- there are certain health issues, certain quality control issues, certain ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 309 temperature issues; in fact, I've delivered in another life summer lunches as a young person in college to different blocks, so there's a certain process. But you're absolutely right that that contract has the same award that when I was at MBEC that we did. Your point is correct that some economic development agency should be saying that that's a contract that should be done here in the City of Philadelphia because there is some firm, if it's nobody but that can do that kind of work with Philadelphia's workforce, so I understand your angst. Thank you for your indulgence, Council.
So it's something called technical ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 310 assistance. When we're -- if we're serious about this vision that we have, then I believe that it is incumbent upon leadership to go into the trenches and not wait for folks to come to so. It means hitting the trenches and going in neighborhoods and sorting out folks who potentially show the capacity and help them move to capacity. So that that would be, what else can we do? Let's get up from behind our desks and hit the trenches and make sure folks are aware of these offers. Has there been any relationship with the American-American Chamber of Commerce, the Hispanic Chamber of Commerce, any of those?
We -- we've been -- we go to all outreach programs wherever I ask -- that I have to go to that we can find. Once a month we meet with the -- at the chamber -- the ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 311 Philadelphia Chamber of Commerce with OEO and Revenue and -- other other departments to explain what's coming up, what's there to look out for, and that sort of thing. The EOP is part of this contract this time around which is a new vehicle to try and get local -- local citizens working. So this is -- hopefully that programs works this time as well because this is the first time. It wasn't in four years ago.
The other thing that we do, Councilwoman, is broadcast opportunities that Procurement has to the African-American Chamber, the Hispanic Chamber, the Enterprise Center and other alliance partners to have them broadcast it out through their networks as well as the operating departments, distribution lists that we have in the OEO registry.
That's ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 312 an important step. That's only a step. There's subsequent steps that come with or after that where you actually get people interested first in a room and you walk them through the process and help them understand the mechanics of the application that they can move capacity.
Do we certainly understand the need to help companies move to capacity and wish we had the resources that we could apply to moving companies in different markets to capacity. This past year we worked on construction, and we're looking at some other markets that we can also target.
Yeah. We want to restore Councilman Goode's time. ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 313 But for the record, you've got places like PhilaBundance we've toured that have capacity that if given direction, some direction, they have the refrigerated trucks. They have the capacity to do some of these potential things that they employee Philadelphians.
Now, I understand that's not your job, but what I hear the Councilwoman talking about is a vision leadership that maximizes our own person -- our own purchasing power. That needs to happen.
What I'd like to do, Sir, is contact Maramont Corporation. I'd like to find out how much they do spend locally because I'm sure they having the warm food it has to come from Philadelphia, so I'll try to look into that for you. ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 314
And Councilman and Councilwoman, your point is taken, and we will take efforts to address your concerns.
Yes. And hopefully, we'll revisit it the sooner than that.
We visited this last year regarding the same contract, went through the same process when at first you said it was the Elliott Lewis contract, and then ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 315 we found out it was the other contract. But before I get to Aramark, because I'm just going to crazy about Aramark in a couple of minutes, I'm going to ask a couple of very simply questions. What's the total request for service, supply and equipment?
The total dollar request for service, supply and equipment contracts.
Material, supply and equipment is I believe 79 million. I believe service, supply and equipment is roughly 50 -- 40, 50 million. I don't know what the differentiation is. I just know those separate numbers are documented. ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 316 What my realy question is for either -- however you want to answer the question and whatever number you want to use, what is the local business participation goal?
As many people as we can get because the -- I don't know what -- there isn't a set goal because I don't know how many are out there. We're constantly --
Let's just cut through all the crap. Is it true that you give contracts to the same people you gave ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 317 them to before and that in many cases you just take the lowest responsibility bidder, and if it lacks a little participation, so what; if it lacks diversity, so what?
Wait. Tell me -- tell me -- I'm -- I'm -- I'm going to --
I'm going the scrap all form of questioning and get down to -- we have you spent "x" amount of dollars on services, supply and equipment?
We'll debate how much that is. Is there a local participation goal, is there a ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 318 minority participation goal, is there a women participation goal? If so, what it is? Where it is found in these budget documents, and just state for the record what is. And if you lie about what it is, the next time I ask you questions it'll to be even worse. So what is the local participation goal and what's the diversity goal?
There is not a local participation goal. There is nothing that is set for that. And I'd like to make clear, that there have been no lies in this testimony or in the future -- it will not any in the future and never been in the past.
I just said the -- I just said, there's no 22 local participation goal, and you said, yes, there is. And then when I asked in what form, you said there ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 319 isn't. What is the diversity goal?
Okay. The diversity for the City of Philadelphia is percent. 6
That's 7 not the question I asked, and that's 8 why this is getting really silly. 9
The only goals 10 that we have are set by OEO for OEO 11 participation goals. Other than that 12 is the best possible job that we can 13 do. 14
Do you 15 handle service, supply and equipment 16 contracts? 17
How much 19 do you spend on service, supply and 20 equipment contracts? 21
What was 24 the goal for that 46 million dollars? ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 320 What will the goal be for that 46 million dollars in terms of local business participation and in terms of diversity?
That's not acceptable, and that's a joke and that's the problem.
You just the take lowest responsible bidder, and you generally give it to the same people. And how long has Aramark had the contract?
When it comes to the lowest, for local business entities, there is not a goal that is ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 321 set, so there is no goal. What has actually happened, there is 37 percent of contracts that have gone to local businesses. Okay? For SS and E, and let me -- please indulge me for a moment. When it comes to SS and E, it's city-wide contracts. City-wide contracts are defined as contracts that are used by multiple departments most of the time. So, for instance, furniture, state, you know -- office supplies, things of that sort. There are also some contracts that are so large that we really need to work with the departments so that we initiate them out of the Procurement Department and that would be Facilities and Maintenance; however, those -- those contracts are still driven by the department. We are a vehicle as Mr. Abernathy had said earlier. We are a vehicle, but do we work closely with ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 322 the departments? Yes, we do. Do we work closely with OEO so we can meet goals? Yes, we do. We know that our goal last queer was about percent, I believe, when I 6 came to service and supplies and equipment. 7
The 10 participation rate. Thank you for correcting me. The participation rate was 10 percent. The goal was 25 percent. Do we think that's perfect, of course not, our goal is 25 percent, but are we moving in the right direction, I believe we are, and do we have the same passion and same conviction that you have? We are limited by legislation. We have to go with the lowest response and the responsible bidder.
That's not true. And you call yourself ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 323 lecturing me on how the process works. I know all that. The lowest responsible bidder -- we've had the same conversation the last couple of years. The lowest responsible bidder is not the lowest bidder. The lowest responsible bidder is the lowest responsible bidder. You determine what a responsible bidder is. The responsible bidder should have subcontract opportunities that are made available to disadvantaged business, and you set that as the goal, have a certain level of participation, and then you take the lowest responsible bidder, not just the lowest bidder. There's a different.
And Councilman, I think it is important to recognize that we have awarded ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 324 contracts to companies that had participation goals that were not the lowest bid as well, to your point. So we understand, and I think what Ms. Stitt was saying, was that we are in agreement. We are working towards the same goals.
What was the participation rate the year before Fiscal Year 11.
2 to 5. And now for quarter two of FY12 it will be around 16 percent, so we are moving in the right direction.
Let me ask this simple question to finish up because you're throwing out numbers ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 325 and saying, I think it was percent, I think it was percent, and now it's 10 percent, we think it's going to be 16 percent. We've been having this discussion all day, and you can't even determine who is actually responsible for it. The Managing Director didn't know. Procurement said it's the managing director of Procurement's responsibility. Procurement then said it's the individual department's responsibility, and then Procurement said that we work within the departments in the OEO, but we can't control what they do.
-- because my understand is, is that Procurement handles city-wide purchasing on these matters, but yuo ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 326 put it off on the departments. So if you're not responsible for it, then put it off on departments, and I'll go after the departments.
Procurement is responsible to award the contracts. We cannot manage them.
I'm not asking about managing the contract. I'm asking about setting the goals within those contracts.
Those goals are set in conjunction with the Office of Economic opportunity. If the --
Who is responsible for setting the goals for service, supply and equipment contracts?
Ms. Dowd-Burton, we're talking about 40, 50 million dollars in contracting.
SSE last ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 327 year was 46 million. I believe in this budget it's budgeted at maybe about 50 million. Whatever the figure is, whether it's 40 or 50 million, it doesn't make a difference. Who is responsible for setting diversity goals?
The Office of Economic Opportunity sets the goals on each of the transactions that go out of the Procurement Department and the operating departments in collaboration with those groups.
I'm not talking about a contract-to-contract basis yet. I'm talking about who is responsible for setting the overall goal for what can be done in terms of that line item in terms of city-wide purchasing of service, supply and equipment?
The goals that you see here are a collection of transactions that are set by the ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 328 Office of Economic Opportunity.
You've done it for Fiscal Year in 10 collaboration with -- 11
We do goal setting with the operating departments for each year, so we did do it for 12, yes.
Did you ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 329 goal set for Fiscal Year 10?
Let me see. I came in -- I came in in '10, so they were already set I believe with OEO --
The collective goal has been percent 24 driven by our disparity study. ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 330
The disparity study says that in terms of service, supplies and equipment it should be percent or that the 5 overall should be 25 percent? 6
-- 13 supplies and equipment. That's what 14 I'm asking about. I asked the same 15 question all day. 16
Okay. We 17 are applying that overall goal to each 18 of the category -- 19
In other 20 words, the disparity study didn't tell 21 you, your work with the departments 22 didn't tell you, what the actual goal 23 should be? 24 If you actually talked to ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 331 the -- each department that's responsible for service, supplies and equipment and what they need and what they think the goal should be based upon vendors they have done business with in the past, you went through that process for Fiscal Year and 8 12, and you talked with all these 9 departments, shouldn't you have a 10 number that's real? 11
When we talk to the departments, we talk about their collective contracting activity which includes professional services, service, supplies and quip, and in some instances, public works transactions. So we're looking at their collective goal based on the activity of those three components. We do not have each department set a goal for service, supplies and equipment, public works --
Then how do you -- ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 332
How do you arrive at a number when I asked you what the goal is for service supply and equipment --
It's a composite number based on the past three years of activity the Department has experienced in terms of participation as well as a forecast of what their contracting experience is going to be for the next fiscal year.
But the number was the same for the also two fiscal years?
But the ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 333 participation.
And they will continue to change based on what we buy which changes from one fiscal year to the next.
So ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 334 whatever we get, we get, and we'll just keep trying?
This is actually supposed to be a more technical process than that. Thank you, Mr. Chairman.
Thank you, Mr. Chairman. Well, a lot of questions were asked here. I'll be real simple. Can you provide over the last two years a list to the Chair on the percentage and number of local and minority and disadvantaged contracts, whether it Public Works, professional services SS and E for the last two years?
You want a list of the contracts or contractors? ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 335
Contracts and local contractors who were awarded the bids?
Well, you want -- vendors that were awarded because of LBE preference?
Well, I know we can provide you with the -- I'm not sure we can -- we can break down what they spend by a ZIP code, which would be a Philadelphia ZIP code. I'm not sure we can break the awards down that way. It's a difference, a big difference.
Can you explain it? The contractors -- the contracts that had been awarded either by public works --
ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 336 Professional services or SS and E over the last two years --
-- and are local business enterprises for disadvantaged minority companies.
And can I -- can I clarify one point? A local business enterprise may be different from a local business because a local business enterprise actually has to go through the certification process. So we certainly can give you the local business enterprises, the LBE's, that have been certified and if they were awarded a contract. We can provide that.
I'll just make a list of the local businesses in addition then because I want to -- I'm trying to get to to local business and do certification process and make sure ELECTRONIC REPORTING STENOGRAPHIC AFFILIATES 337 they're taking advantage it.
So if you can just provide that to the Chair, I'd appreciate it. And a dollar valve today?