O’Malley wants updated procurement process

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ANNAPOLIS — Gov. Martin O’Malley says Maryland’s antiquated procurement process might need an overhaul, and the attorney who helped write the law agrees with him.

Scott A. Livingston, a partner with the law firm Rifkin, Livingston, Levitan & Silver LLC, helped write the state’s procurement law, basing it on the American Bar Association’s Model Procurement Code.

That code was developed in 1979, and has since been updated. Livingston — and the governor — said it’s time for the state to play catch up.

During Wednesday’s meeting of the Board of Public Works, an exasperated O’Malley asked for an outside review of the procurement process adhered to by state agencies.

The issue was brought to the forefront after the Department of Human Resources was forced to restart a procurement after the Maryland State Board of Contract Appeals overturned the agency’s award, citing “fatal flaws” in the evaluation of the winning bidder to run a call center that takes questions about child support payments.

“It’s really good at [detecting] fraud or abuse, but it’s also very good at preventing procurements,” O’Malley said of the state’s procurement policy. “It gets rid of the flexibility that’s needed in the procurement process. I would really love to have someone come in to kick the tires.

“We have got to start fixing this. We can’t keep whistling by these incidents and pretending like this is Maryland at its best.”

The failed human resources procurement erroneously assigned high scores to the winning bidder, Calls Plus-Attiva Soft Joint Venture LLC, in the request for proposals’ two highest-priority categories. The procurement also used defective arithmetic in its final ranking of potential awardees.

“It was a step back for us,” said human resources Secretary Ted Dallas. “Clearly, we made some mistakes in the process.”

Budget Secretary T. Eloise Foster told O’Malley that the procurement errors happened because unqualified people were conducting the evaluation, not necessarily because of a flaw in the system. But O’Malley still said a review of practices should be conducted.

“This is one area where there’s been a lot of pointing to the past,” O’Malley said. “We need to pull this apart and put it back together.”

Livingston said the governor’s instincts were spot-on.

“It’s an excellent idea for the governor to revisit procurement law and make sure it’s streamlined and modernized,” Livingston said. “The governor is correct because it’s good for preventing fraud and favoritism. And he’s also correct that it takes a long time [to award contracts].”

Livingston said that procurement officers were doing the best they could with the outdated laws they worked under.

The question now turns on how to go about reforming policy. O’Malley suggested the state reach out to the national procurement groups, which might parachute into Maryland and offer an analysis of the state’s practices.

The National Association of State Procurement Officials, which collects dues from procurement officers in all 50 states, does not conduct such analyses, but could recommend a firm that could fit the bill, if O’Malley asks.

“We provide services such as education, we produce publicans, we do research for our members … and the public,” said Elena Moreland, a senior policy analyst. “We hire outside groups, we have partnerships that provide technical assistance. We would reach out and provide that service to our members.”

O’Malley did not provide a timetable for a procurement review, but said that any changes to the system would not be enjoyed during his tenure as governor.

The failed human resources procurement resulted in a $4.3 million extension of the incumbent’s contract. San Diego-based The Active Network Inc. will continue to operate the call center for the next year.

Both O’Malley and state Treasurer Nancy K. Kopp approved the extension. Comptroller Peter Franchot was on vacation and did not attend the meeting.