The no-bid micro contracts awarded to vendors at the center of a bribery scandal are rife with wildly inflated costs, an analysis finds.
How much does it cost NYCHA to change a lightbulb?
In one case, more than $708 per bulb.
That’s the rate the housing authority paid one vendor, who submitted a total bill of $4,250 to replace six LED bulbs and covers at Throggs Neck Houses in The Bronx, according to records reviewed by THE CITY.
Another vendor billed NYCHA $4,985 to replace one door to a compactor room. Yet another charged $4,875 to put in slip resistant rubber treads on a stairway with 15 steps — a cost of $325 per step.
When law enforcement officials arrested 70 current and former NYCHA workers on bribery charges earlier this month, they identified small no-bid contracts for apartment repairs, awarded to select vendors in exchange for cash to superintendents, as the source of corruption.
What prosecutors didn’t say was that many of the bills submitted by the vendors who win these so-called micro-purchase contracts raise serious questions about whether NYCHA wound up paying them hundreds of thousands — or even millions — of taxpayer dollars in inflated costs over the years.
All of these bills had one thing in common, a review of contract data by THE CITY found.
The vendors sought compensation as close to the maximum allowed at the time on each contract, regardless of the work performed. Micro contracts have a built-in incentive for vendors to bill for just below the maximum allowed — $5,000 until late 2019, $10,000 since — no matter what the scope and value of the task at hand is.
It is a bit of both.
It is really hard to write a good contract that can handle the scrutiny of a public bidding process and it is really hard doing it when paying staff the wages that NYCHA likely pays the staff managing their contracts.
The jobs have gotten outsourced since NYC in general has found keeping staff on hand to be incredibly expensive, but the model of contractor maintenance is to make money where possible, not to serve the best interest. It is really hard to write a contract that makes serving the public good a money maker for the winning contractor.
