An investigation by the city's inspector general into the Rawlings-Blake administration's purchase of nearly $675,000 in phone and computer equipment found possible conflicts of interest and missed opportunities for "significant cost savings."
Inspector General David N. McClintock also found that the Mayor's Office of Information Technology withheld information from other city officials about the project. For example, a former deputy mayor directed another city employee to mislead City Council President Bernard C. "Jack" Young by denying that the mayor's office was taking steps to upgrade the city's phone system.
The mayor's information office failed to get multiple quotes when buying equipment, which could have yielded savings, McClintock wrote. He also wrote that two key managers charged with implementing the new system were contractors with Rockville-based Digicon Corp. One of them was allowed to commit city resources "in a way that financially benefited Digicon."
The mayor's information technology office "failed to take reasonable and appropriate measures to ensure that contractors did not engage in activity that either created conflicts of interest or the appearance thereof," McClintock wrote. "It is apparent that either the conflict issues were not recognized or that they were dismissed."
The Baltimore Sun obtained a copy of the report Thursday. The inspector general plans to publicly release his report Friday.
Administration officials took issue with some of the report's findings and said the equipment was purchased at inexpensive prices. In a statement, the mayor's office contended that the technology purchases were "neither out of the ordinary nor in violation of law," citing an opinion by the city solicitor. Mayor Stephanie Rawlings-Blake has "made ethics a top priority of her administration," according to the statement.
The administration also noted that it has already worked to "significantly tighten controls on the City's electronic procurement system to ensure that all purchasing procedures and guidelines are strictly adhered to."
Damien Sharp, the chief of staff of the mayor's technology office — and a former Digicon subcontractor — no longer works for the city, according to the administration's statement. His judgment in this case "has become a distraction to MOIT," the statement said.
Digicon did not respond to requests for comment. As a subcontractor, Sharp's relationship with Digicon was "virtually nonexistent," a Digicon lawyer has said.
Rawlings-Blake has "implemented a new staffing contract to diversify the pool of IT professionals, from the existing two vendors to as many as 50 vendors, significantly reducing reliance on any single IT contractor," the mayor's office said. The city is also "implementing new requirements for all contracted staff to ensure that there is not even the appearance of a conflict of interest."
McClintock's report noted that the chief of staff was "involved in MOIT's purchases from Digicon during his tenure" as a Digicon subcontractor and tried to dissuade a project manager from seeking price quotes from other vendors.
For months, Rawlings-Blake and Baltimore Comptroller Joan M. Pratt have sparred over the purchase of phone-related equipment by the mayor's information technology office. Pratt's office had undertaken a similar effort to convert the city's phones to VoIP, or Voice over Internet Protocol. Such systems are considered more efficient and allow calls to be placed through the Internet rather than on traditional phone lines.
Pratt has said that the equipment purchases should have been subject to a separate competitive bidding process. The city solicitor, George Nilson, says the transactions were covered under a blanket purchasing contract for computer equipment and didn't need further bidding.
The inspector general's report did not take issue with the city solicitor's opinion that the mayor's office had the authority to purchase telephone hardware. That issue, it added, "is separate and distinct from the question of whether that procurement was conducted in accordance with the laws, rules and procedures governing the procurement process."
McClintock's report found the following:
•Top administration officials deliberately tried to conceal from Pratt and Young their plan to replace the phone system. "We should be done with half the city before they get around to awarding a bid," then-Chief Information Officer Rico J. Singleton wrote to a former deputy mayor.
•About $673,000 in purchases were for equipment and installation of a new phone system, not the other uses that administration officials have contended.
•The mayor's information technology office failed to get price quotes from other companies. "The City is now unable to produce documentation to support a legitimate cost comparison ensuring that the City received the best possible pricing," the report stated. "The OIG believes that the City has missed significant cost savings opportunities."
•"A significant amount of time and money has been spent on recent efforts to improve the City's telephone system. This time and money was spent by two different City agencies working on disparate efforts to accomplish the same thing."
The Rawlings-Blake administration noted that much of what the inspector general found happened under Singleton, who has since left.
"All the events and circumstances contained in the report occurred under the direction of a former Chief Information Officer, who was separated from City government more than eight months ago," the statement said.
The officer, Singleton, resigned in February after an audit in New York detailed ethics violations while he worked in that state's government, including negotiating a job for his girlfriend and soliciting a job for himself with a software vendor that was awarded a major contract.
The new chief information officer, Chris Tonjes, said he plans to work collaboratively with Pratt's office to implement the new phone system. Even so, Tonjes said he believed the Digicon purchases were of high value and saved taxpayers money. In his last job at the D.C. library system, Tonjes said, he paid much more than what Digicon charged for the same equipment.
The mayor's information technology office is "doing everything possible to save taxpayer money over the long run," the statement from the mayor's office says.
Councilman Robert Curran, who was briefed on the report Thursday, said he was disappointed by the apparent conflicts of interest shown in the report.
"Obviously that's improper," he said. Still, Curran said, "the bottom line is nothing was illegally done."
Councilman William H. Cole IV said that "it's clear the administration has to tighten up some things," but he was encouraged to see the report didn't point to any illegality.
"It is refreshing that we have an inspector general that is active, engaged and willing to take on tough issues," he said. "I think steps will be taken to make sure things like this don't happen again."
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