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For years, Evanston has required City construction contracts over a certain dollar figure to comply with a “Local Employment Program” requiring the hiring of Evanston residents to work on projects. Recent changes to the LEP program shifted what had been a less than onerous $100-per-day fine for noncompliance to a more imposing fine equal to 1% of the contract value.
A proposed contract on the Aug. 17 City Council agenda called into question the ultimate goal of those changes and the impact of those changes on official City policy. City staff, including City CFO Marty Lyons and City Manager Wally Bobkiewicz, took the position that it was an established City policy that a contractor requesting a waiver of the LEP requirement was deemed “non-responsive” for bid evaluation purposes.
As a result, City Staff rejected a bid of about $303,000 for the rehabilitation of water plant clearwells, and recommended to Council a bid of $452,000. Mr. Bobkiewicz said, “It’s very straightforward. We have an unresponsive bid because they asked for [an LEP] waiver.”
The Administration and Public Works Committee votes on most City contract work before sending contracts to the full City Council for approval. The discrepancy in cost between the LEP-compliant vendor, EJ Henderson, and the low bidder who asked for a waiver, Walsh Construction, created a predictable reaction among committee members.
“Just because this person will comply [with the LEP] does not mean we have to select this outrageous bid,” said Alderman Ann Rainey, 8th Ward.
Alderman Jane Grover, 7th Ward, called for changes to the LEP policy. “Just that we have a policy that produces such a skewed result [in cost differential]” means “we need to change the policy.”
The LEP’s requirement that 15% of wages paid go to Evanston employees meant, said Ald. Rainey, that the City was spending nearly $150,000 to preserve at most $67,000 in wages to Evanston residents.
“The new Evanston policy does not grant staff options,” said Mr. Lyons. LEP compliance is a requirement the same as insurance coverage, he said, so the Walsh bid was deemed nonresponsive. Ald. Grover agreed – it is Evanston’s policy, she said.
“Says who?” asked Second Ward Alderman Peter Braithwaite, chair of the very MWEBE Committee that proposed changes to the LEP ordinance. “We didn’t change the requirement, we just made modifications to the penalty” for failure to comply, he said.
The RoundTable asked Sixth Ward Alderman Mark Tendam, who also sat on the MWEBE Committee at the time, what changes were discussed and implemented, whether it was his understanding that a contractor asking for a waiver from the LEP should be deemed non-responsive by City staff.
“I don’t think that’s true at all,” said Ald. Tendam. “I can’t believe that’s the case… the waiver is what makes them compliant.” To automatically reject a bidder for merely asking for a waiver “doesn’t seem right,” he added.
Ald. Braithwaite, speaking with the RoundTable after the meeting, said it was never the intention of the MWEBE Committee for City staff to reject low bidders out of hand because they asked for a waiver. Instead, he said, the City can simply reject a request for a waiver while accepting the low bid. The contractor can then determine whether to comply with the LEP requirement or pay the fine. A similar situation arose on a February contract for cured-in-place water pipe repairs. Then, the low bid was some $44,000 under the LEP-compliant bid. At that time Ald. Braithwaite said he expected the City to reject the waiver request and for the contractor to comply with the LEP. If not, the contractor could comply in other ways, including possibly the assessment of the 1% fine.
The RoundTable asked Mr. Bobkiewicz and Mr. Lyons for the origin or source of the City policy dictating the rejection as non-responsive of any bid from a contractor requesting an LEP waiver (provided another bidder promises compliance). Mr. Lyons wrote in reply:” [W] hen the City solicits bids and some contractors comply with LEP and others request a waiver, the City has specific proof in the form of another bid that the LEP program can be a part of the given project and that a waiver for a different vendor on the same bid cannot be granted because LEP is possible.
“LEP is a City Council-approved program, and therefore non-compliance when the program is applicable can be deemed ‘non-responsive.’ All businesses that pick up a bid or RFP packet receive instructions on both [MWEBE and LEP] programs in the packet and therefore should be aware.”
The Committee voted to hold the clearwell project until Aug. 31, when it will appear on the Council, not the APW Committee, agenda. The MWEBE Committee does not meet before that date, but Mr. Bobkiewicz said, “This is an important project” affecting proposed water sales to other communities. He added, “When the weather turns, we would want to be done with this project.”