Firm lost district job despite vow of diversity
E-mails show it pledged 67% of work to businesses run by minorities and women - Arlene Ackerman's stated priority - but still got bumped.
In overriding her professional staff and demanding that a $7.5 million no-bid surveillance-camera contract be awarded to a minority company, School Superintendent Arlene C. Ackerman said she wanted to make sure that such firms were treated fairly.
But the company that had begun preliminary planning before Ackerman pushed it aside - Security & Data Technologies Inc. - had guaranteed to provide 33 percent of the work to a minority contractor and 34 percent to a firm owned by a woman, according to e-mails reviewed by The Inquirer.
The SDT guarantee is documented in a series of e-mails to the school district and in internal district e-mails, including one sent to Leroy B. Nunery II, the deputy superintendent, six days before Ackerman took action Sept. 23.
In meticulous detail, they describe SDT's plan to include minority- and women-owned firms in a project to install surveillance systems and command control centers at 19 schools classified as persistently dangerous.
That work, classified as "emergency" to get around bid requirements, would be worth about $5 million, according to district calculations in the documents.
Explaining her decision to reject SDT before a contract was approved in favor of a minority-owned firm, IBS Communications, Ackerman said in a recent interview, "I asked the question, 'Are there any minority contractors represented? Why didn't IBS get a chance?'
"To me, it didn't feel right, and it didn't smell right. People have benefited from this system, and it's not fair, and it's not equitable. . . . There are the 'haves' and the 'have-nots.' "
The e-mail traffic makes it clear that companies run by minorities and women would have received the bulk of the work on the surveillance job.
In a draft of a resolution to the School Reform Commission sent to Nunery on Sept. 17, Myron Patterson, chief of school safety, spelled out the specific percentages allotted under the SBT plan:
"MBE participation for all installation . . . will be 33%," Patterson wrote. "WBE participation . . . will be 34%." (MBE signifies minority-owned enterprise, and WBE stands for businesses owned by women.)
Nunery said in a statement that he and Ackerman "undertook a thorough review" of the proposed resolution before Ackerman vetoed SDT. That paved the way for the work to be awarded to IBS, a small Mount Airy company that - unlike SDT - was not on the state's approved list of emergency contractors, though it is an approved contractor for the City of Philadelphia.
The e-mails provide a trail of how SDT and school district officials worked together to ensure that the district's commitment to businesses owned by minorities and women was fulfilled - until Ackerman interceded.
In a Sept. 16 e-mail to the district's senior information-technology project manager, Amy McCole, SDT vice president of sales Kenneth R. Spressart wrote: "We have not yet 100 percent settled which subs we are going to use, however, here are the percentage goals to use: MBE 33% WBE 34%."
In a follow-up e-mail that day, McCole asked Spressart to provide company names in order "to have Executive Mgt prepped."
Five days later, Bob Westall, McCole's supervisor, confirmed SDT's commitment and specified that the firm was considering minority contractors Larry C. McCrae Electric, a Philadelphia company, and MJK Electric, a South Jersey company.
For the female component of the proposal, Westall's memo said Tri-State Telecommunications of Bristol and EJ Electric were under consideration. As it turned out, SDT was mistaken about EJ's ownership; the company, once owned by a woman, is controlled by a white businessman.
In each case, SDT suggested two firms so SDT could solicit cost estimates and ensure that the district was paying the lowest possible price for the work.
Given the magnitude of the contract, Westall's e-mail concluded, "It's reasonable to expect 33% and 34% respective participation for MBE + WBE on a total of ~$5 million."
SDT, which had worked with McCrae in the past, did not inform him his firm was under consideration, sources said. Because of their ongoing relationship, SDT expected that McCrae would welcome the opportunity to join the project. In the case of MJK, which had not worked with SDT before, an SDT executive called to verify its minority ownership. Efforts to interview representatives from the two companies were unsuccessful.
Shana Kemp, a district spokeswoman, questioned whether SDT and the district staff were serious about the proposal to include minorities and women because they had failed to complete a minority-participation form and attach it to the draft SRC resolution. That requirement, she said, dated to 2003 and was implemented because several firms owned by white businessmen had failed to fulfill their commitments.
In addition, Kemp said, the district had begun an investigation to identify the sources of information published by The Inquirer. "They are sending you on a wild-goose chase," she said.
The sources who provided their account of the events leading up to the IBS contract award asked not to be identified because they were concerned that doing so could jeopardize their jobs.
Despite SDT's written commitment to guarantee work to minority- and women-owned firms, Ackerman ordered the work be given to IBS, according to sources with extensive experience in school district business operations.
During the interview with The Inquirer at district headquarters Nov. 30, Ackerman vehemently denied that she had made the decision. She said she simply had instructed Nunery and his staff to be sure to include minority firms in the project.
Nunery, who was sitting at the table, said he - not Ackerman - had selected IBS.
Then, noting that one of the proposed subcontractors was Tri-State, Ackerman complained that the firm had overcharged the city for emergency work last December at South Philadelphia High School and had installed too many surveillance cameras.
She said she had gotten her information from IBS, which had a small piece of the project, thanks to Ackerman.
The South Philadelphia project was ordered after attacks on Asian students.
Ackerman directed her staff to improve security and upgrade facilities over a weekend, and to make sure minority firms were involved in the $700,000 project. As the work neared completion, she said, she discovered there were no minority firms on the job, and her staff told her it didn't know of any that installed surveillance cameras.
It was then, she said, that she handed her staffers an IBS business card and told them to "find some work" for the company.
The company was incorporated in December 2000 by Darryl Boozer, who has declined interview requests. Ackerman said she had gotten the IBS card at one of many functions she attends.
A witness at a recent SRC meeting, the Rev. Leroi Simmons, representing the Germantown Clergy Initiative, extolled Boozer, calling him a man of "high moral character" who worked diligently to help his community. Recounting a scorchingly hot summer day when they were working side by side at Germantown High School, Simmons said he had asked Boozer why he was spending so much time at the school. "I'm doing it for the children," he said Boozer had replied.
Since Tri-State had finished installing the cameras at South Philadelphia, the only work remaining was for IBS to provide schematic drawings of the project. IBS was paid $12,980; Tri-State said it would have done the drawings for $1,000.
Ackerman said she knew nothing about the $1,000 offer.
Ed Long Jr., vice president of Tri-State, said district officials had previously praised his firm's work. He said school police had dictated the number and placement of the surveillance cameras.
Tri-State was a subcontractor on the project. In fact, when The Inquirer received a response from the district in August to a right-to-know request about payments related to South Philadelphia, Tri-State was not mentioned among the vendors that had worked on the project.
The company was paid about $191,000 for its work at South Philadelphia. More than $100,000 of that, Long said, was for equipment.
Long said the total project cost at South Philadelphia had exceeded $700,000 because Ackerman had ordered the work to be completed over a weekend, to try to end a boycott by Asian students.
The cost, he said, included overtime for more than 40 district employees who renovated the school's bathrooms, as well as $8,000 to $10,000 in overnight shipping costs for equipment.
"We had to have equipment shipped in from all over the country from different suppliers," Long said. After learning of the project on Friday, Dec. 11, 2009, he said, he had four hours to place orders for delivery the next morning.
Long said he was dismayed that Ackerman and others had characterized the controversy over the process that the district followed to award contracts to IBS as a dispute over the district's effort to make sure minority- and women-owned businesses received district work.
"She is making this look like this is to support minority businesses, when they already were being supported," said Long, pointing out that his firm is a woman-owned business. His mother is the firm's president.
In defending the award to IBS, Nunery said that "80 percent of the kids in our schools are persons of color, yet minority contractors receive only 20 percent of all contract awards. How are we supposed to convince these young people that they will have equal opportunities in society if the adults who look like them in this community aren't getting equal opportunities in matters like this?"
But when minority- and women-owned businesses receive contracts, Long said, it does not mean all their employees are minorities or women.
Students, he said, may still see white men working in their schools, even on these projects.