By Julie Scharper, The Baltimore Sun
9:36 PM EDT, July 10, 2012
As the Baltimore comptroller's office was seeking bids for a multimillion-dollar upgrade of the city government's telephone system last year, the mayor's technology office was buying about $500,000 worth of equipment that could be used for the same kind of system upgrade, documents show.
The mayor's office says the purchases were part of a pilot project and that only about $55,000 was spent on equipment for the new Voice over Internet Protocol (VoIP) system. The additional money was spent on equipment that was used for other computer-related needs, a spokesman for the mayor said.
But a purchase order from the Mayor's Office of Information Technology shows it spent $441,450 on switches that would provide the "VoIP switch infrastructure for buildings in the downtown Baltimore campus." And phone technology experts say the 124 computer switches included more expensive features primarily used for phones.
The dueling attempts to upgrade City Hall's aging telephone system have pitted two of the city's elected Democratic powerhouses — Comptroller Joan M. Pratt and Mayor Stephanie Rawlings-Blake — against one another, while stoking debate over how to best spend taxpayer money.
The mayor says her technology office is best equipped to oversee the complicated new computer-based phone system, while the comptroller says the mayor is circumventing the government procurement process by purchasing the equipment through a 2010 contract rather than engaging in a new round of competitive bidding. Pratt called that "illegal."
The battle could heat up Wednesday when the city's spending board, of which Pratt and Rawlings-Blake are members, takes up the issue.
Pratt's office wants to award a $7.4 million contract to overhaul the phone system to IBM, the winner of its lengthy competitive bidding process. The mayor's office has declined to say how she and her two appointees to the five-member board will vote, though a spokesman says Rawlings-Blake has questions about the deal.
The turf war became public when the comptroller accused the technology office of trying to circumvent the competitive bidding process by cobbling a phone system together under an existing contract. Pratt has accused Rawlings-Blake of telling "an untruth" about her knowledge of the purchases.
Rawlings-Blake has vehemently disputed Pratt's claims and demanded an apology. The mayor and her aides staunchly defend the purchases and say that buying what they characterize as small amounts of phone equipment did not violate purchasing rules.
Baltimore political observer Matthew Crenson said the failure of the comptroller's and mayor's office to work together on this issue shows a dysfunction in City Hall that should be troubling to taxpayers.
"It sounds as if the mayor's office hasn't been talking to the comptroller's office," said Crenson, professor emeritus of political science at the Johns Hopkins University. "If they had been, they could have settled this whole thing much more quietly."
At issue is who should upgrade the city's outdated phone system. Most workplaces have converted to a VoIP system that allows employees to get voice mail via email and is more cost-effective because fewer phones lines are needed.
The city's budget — drafted by Rawlings-Blake's finance office and approved by the Board of Estimates — noted for both the current and past fiscal year that Pratt's office would lead a competitive process to install a new phone system.
The mayor's technology office purchased Cisco equipment — the 124 switches, 80 VoIP phones, including some with video touch screens, and other items — on May 23 and June 13, 2011, city records show. The June purchase order listed other equipment that would be needed to complete the transition to a VoIP system, including "a small number of additional switches."
Meanwhile, bids for the phone project were due to Pratt's office on May 25, 2011.
The simultaneous efforts took place in City Hall buildings a block apart. While Pratt sought input from officials in Rawlings-Blake's technology office, she said they didn't give her the same courtesy and never informed her of their equipment purchases.
Ryan O'Doherty, a mayoral spokesman, said Rawlings-Blake believes the technology office has the knowledge and expertise to best implement a new phone system, not the comptroller's office. He and outside VoIP experts said that the new high-tech phones are usually overseen by technology workers, not phone officials. This type of phone system hooks into an existing data network.
"We've been very clear from the beginning that our technology office thought there was a pretty good chance for the city to implement this project with less outsourcing, in a faster time and with less costs," O'Doherty said.
The mayor's former chief technology officer, Rico Singleton, did approach Pratt in December — months after companies had turned in competitive bids for the phone system project — and proposed taking charge of the phone system overhaul using Cisco equipment to switch to VoIP.
After conferring with consultants, Pratt rejected the idea. O'Doherty described Singleton's plan as not a "formal proposal."
Singleton was forced to resign from the city in February after a New York state audit accused him of numerous ethical violations in a former job. He did not respond to requests for comment for this article.
Robert Minor, who has been serving as the city's acting chief technology officer, referred questions to O'Doherty, citing a pending investigation by the city's inspector general. The mayor announced last week the hiring of a new chief technology officer.
O'Doherty said the equipment purchases last year were for a pilot program and made under an existing city contract for ongoing computer-related needs. He said the city spent only about $55,000 on phones and related equipment for the pilot program, and that other items were used for other purposes. All of the 124 switches have been installed in city offices, O'Doherty said.
Replacing the city's entire phone system would require a competitive bidding process, O'Doherty said, and all of the equipment for such an endeavor could not be bought under the existing "requirements" contract with Digicon Corp.
"There is no question that you cannot buy all the equipment that is needed under existing contracts," he said.
Still, O'Doherty said, the mayor has "a number of serious questions" about the IBM deal that Pratt is recommending.
"Is this the most effective use of our tax dollars?" O'Doherty said. "Has there been enough cooperation and collaboration between the comptroller's office and the technology office?"
O'Doherty questioned why only one company — IBM — was found to be the sole responsive bidder. "Was there enough competition for this?" said O'Doherty. "You would think there would be more qualified bidders instead of just one."
Pratt said she was "appalled" that the mayor's office would question the degree to which her staff collaborated with the mayor's team and called O'Doherty's questions "ridiculous." Her office and the technology office teamed up to assess the phone needs of all city agencies, she said. Moreover, the team that reviewed the bids included four employees who answer to the mayor and only one who answers to Pratt, the comptroller said.
Pratt pointed out that it was common for only one or two companies to submit a responsive bid for a city project. She dismissed the mayor's concerns as "just another angle to try to not approve this.
"The sooner the contract is approved, we can implement VoIP and start saving money," she said. "It is not an effective use of taxpayer dollars to delay the contract."
Pratt says she believes the Municipal Telephone Exchange, the office that oversees city phone operations and reports to her, is best poised to implement the new system. The comptroller's office has supervised the phones since the 1940s.
Moreover, Pratt questions why the technology office would attempt to take over the phone system when it helped her staff write the request for proposals and evaluate the bids.
"It seems like MOIT [the Mayor's Office of Information Technology] just wants to take over and implement its own system," Pratt said in an interview.
She said that Singleton told her that his proposal would cost the city about $2.2 million. But, said Pratt, when an independent consulting company, the Battles Group, reviewed the proposal, it determined that Singleton's plan was incomplete and would make it difficult to grow and maintain the phone system.
Singleton's plan includes detailed specifications of Cisco equipment that could be used to implement the phone system. The proposal also notes the importance of adding the Power over Ethernet, or PoE, switches to prepare for the phones. Such switches allow electricity to be run through a data cable and would be primarily used for VoIP phones in an office, but also webcams and security cameras.
Pratt said that when she issued a request for proposals in March 2011, three bids arrived: Aastra USA, IBM and Telephonet. The Aastra bid was disqualified because it arrived late, Pratt said. A panel of five city employees from various agencies reviewed the remaining bids and decided that Telephonet scored too low on certain technical specifications to be further considered.
Telephonet officials say they plan to protest any award of the contract to IBM. IBM officials, through an attorney, declined to comment for this article.
A Digicon spokesman declined to say why Digicon did not bid on the current contract or whether the company would consider bidding if the city rebid the contract.
The city's normally perfunctory Board of Estimates meeting took a dramatic turn last month, the first time the contract came up for a vote. Rawlings-Blake asked to defer the decision, which prompted angry words from Pratt.
"You told an untruth and said you didn't know the equipment was installed, and you did because it was on your desk," Pratt said as Rawlings-Blake calmly sipped a cup of coffee.
Since then, Pratt has continued to criticize the deal, providing reporters with documents and, for the first time in her decade and a half in elected office, has publicly and repeatedly criticized a mayor.
Rawlings-Blake has stressed that a report issued by City Solicitor George Nilson says that her technology office did not violate the law.
In his opinion, Nilson says that the technology office was authorized to purchase the equipment under an existing contract with Digicon Corp. The city has bought computer equipment from Digicon's Rockville office since 2010 and has clearance to buy items from Cisco, among other brands, under the contract.
The high-tech phones blur the line between phones and computers, Nilson wrote in his letter. Although phones aren't specifically mentioned in the city's contract with Digicon, they could be considered computer accessories or infrastructure, which are approved, he wrote.
Nilson noted that Digicon won its city contract, and subsequent renewals, through a competitive bidding process, and that there was no need for the city to seek additional bids unless the city could get significant savings. He argued that because the purchases of phones and related equipment for a "maximum of $55,262" constituted such a small portion of the city's $3.4 million contract with Digicon, additional bids wouldn't yield such savings.
Four independent VoIP experts who reviewed the city's purchasing documents identified more than $500,000 spent on Cisco phones and other equipment that would be necessary for a VoIP system — an expense they said suggests a broader effort than a pilot program. Pratt has questioned purchases under two orders totaling $659,000.
"It's really not a pilot program," said Arthur Olshansky, who designs phone and other computer systems at Federal Hill Solutions in Baltimore. "It looks like a whole new system."
The phone experts said that if the 124 switches were intended to just support computers and other equipment, they would not need the Power over Ethernet technology, which adds as much as $800 to the cost of each switch.
"It's putting PoE throughout the whole network. The only reason you'd be doing that is you would be preparing to put phones everywhere," said Todd Bernard, co-owner of InBand Networks in Elkridge and a certified Cisco expert.
Bernard, whose company has supervised the installation of VoIP phone systems for Howard County, among other local governments, said the switches contain enough ports to hook up more than 4,000 phones. He also noted the technology office bought more than $27,000 in servers that are identified by Cisco as being part of the bundle for VoIP.
"With everything else that was purchased here, this is the only reason you'd be buying that," Bernard said.
But Minor, the acting chief information officer, said in a letter that the switches have been used for other purposes in the year since they were bought.
O'Doherty, the mayor's spokesman, said the technology office needed to purchase switches for other reasons and decided it would be cost effective to get ones that could eventually be used for a phone system. The switches can support other brands of phones, including IBM.
Nilson, who is appointed by the mayor, said officials in the mayor's technology office and the purchasing department informed him that the total cost of phones and related equipment was $55,262.
"I am relying on them," said Nilson.
Nilson said he was not familiar with the purchasing document that the purchase of $441,450 of switches was for infrastructure for the VoIP project. The document was distributed by Pratt to reporters last month.
If the purchases had constituted "a necessary element" of the phone upgrade contract, Nilson said, "I would have stopped and taken a much harder look at those numbers."
But he said he believes the information the technology office gave him is correct. "I relied on the information that was given to me, which I still think was accurate," he said.
The VoIP experts said it is common for phone and information technology departments, both in government and the private sector, to have a power struggle over the new phone technology. Many companies and governments have merged their phone and technology offices with the advent of the phones, they say.
The mayor's technology office has long sought a role in the changeover to VoIP, and Singleton touted the office's contributions to the effort. "We have also implemented VoIP telephony," he wrote in the office's winter newsletter, listing the office's successes.
The office's website listed "telecommunications" among the core services it provides as recently as March and said it "has worked hard to institute citywide VoIP services." The web page has since been taken down.
But the comptroller has steadfastly defended her turf. Pratt and Simon Etta, acting chief of the Municipal Telephone Exchange, say the contract with IBM would save the city $23 million over 12 years compared with the current system.
They say IBM plans to update the infrastructure and install 2,700 phones over the next three years. Another 5,000 phones needed by city workers would be installed over the next year at an additional cost of less than $300,000, they say.
Pratt said she hoped public opinion would sway the mayor and her appointees on the spending board to vote in favor of the contract.
"With all the awareness it's getting, people are concerned about the transparency of the procurement process," she said.
Baltimore Sun reporters Luke Broadwater and Gus Sentementes contributed to this article.
Copyright © 2014, The Baltimore Sun