EmailEmail
PrintPrint
Schools sued over aid to minority firms
Legal action spawned by award of contract for electrical work
Thursday, April 05, 2007

A West End resident has sued the Pittsburgh Public Schools, claiming the district is preparing to squander $200,000 on an overzealous effort to steer business to minority-owned and other disadvantaged companies.

Ironically, Henry M. Fields III's complaint about the district's "business opportunity program" comes at a time when some school board members and two University of Pittsburgh researchers are saying it isn't doing enough to involve disadvantaged companies in construction and other projects. The researchers said discrimination is partly to blame.

The struggle to balance financial responsibility and social justice isn't unique to city schools. Across the country, business opportunity programs have been criticized either for coddling disadvantaged companies at taxpayer expense or for not doing enough to help the companies get a fair share of public dollars.

"There is a natural tension between competitive bidding law and this type of program," school district Solicitor Ira Weiss said.

Mr. Fields, an employee of Westmoreland Electric, sued the school district March 2 for disqualifying his employer's $1 million bid for an electrical contract at Sterrett Classical Academy in Point Breeze. The school board instead accepted Moletz Electric Co.'s $1.2 million bid.

In bid specifications, the district said it wanted at least 15 percent of the contract dollars funneled to subcontractors or suppliers certified as minority-owned, women-owned or economically disadvantaged businesses.

Mr. Fields said Westmoreland missed the goal by 0.38 percent. He called the shortfall "minor and immaterial" and said the district has the right to forgive minor problems with bids, especially if it means saving the taxpayers $200,000.

But Mr. Weiss called the shortfall a serious matter.

In all, nine companies vied for the electrical contract, with bids ranging from $952,962 to nearly $1.6 million. The lowest bidder withdrew its offer because of a mathematical error. Westmoreland and two other companies were disqualified for not meeting opportunity program specifications.

Next in line was Moletz, of Millvale, the fifth-lowest bidder, which met the 15 percent goal. Moletz also was named a defendant in Mr. Fields' suit.

The suit has not been resolved, though a judge refused Mr. Fields' request for a preliminary injunction to force the school board to award the work to Westmoreland. The school district said the electrical project is proceeding.

Some school board members have cited a need to beef up the business opportunity program, not rein it in.

Mark Brentley Sr., Thomas Sumpter and Randall Taylor have questioned the district's liberal use of change orders to complete projects associated with Superintendent Mark Roosevelt's school reorganization plan. Mr. Brentley said some of the add-ons should have been put out for bids instead to give disadvantaged firms more chances to vie for district business.

Alarm also was raised by Ralph Bangs, associate director of Pitt's Center on Race and Social Problems, and Audrey Murrell, associate professor at the Katz Graduate School of Business, who said minority-owned businesses obtained only 3.2 percent, or $1.7 million, of the $53.6 million in prime contracts and change orders the school district approved from January 2005 through September 2005.

The researchers said interviews with officials of minority-owned companies revealed "strong evidence of discriminatory practices" by the school district. They said school district staff sometimes didn't return the companies' calls, omitted the companies from project notification lists, overused change orders and awarded contracts without competitive bidding.

The two did not, however, study prime contracts awarded to women-owned or economically disadvantaged companies, and they did not study subcontracts at all.

Dr. Bangs and Dr. Murrell found low participation by minority-owned firms in Allegheny County contracts, too, and similar complaints have been raised nationwide. For example, National Black Chamber of Commerce President Harry C. Alford last month complained about a lack of contracts for minority-owned businesses in Hurricane Katrina rebuilding.

Mr. Fields' lawsuit doesn't challenge the school district's business opportunity program, just strict enforcement of the electrical contracting goal.

Westmoreland offered to modify its bid to meet the goal, but its offer wasn't accepted. William J. Meyer, one of Mr. Fields' lawyers, said the school board awarded the bid without the waiting period it usually gives to disqualified bidders for objecting.

"Westmoreland is an experienced, savvy company. ... They understand the rules of the game," Mr. Weiss said.

First published on April 5, 2007 at 12:00 am
Joe Smydo can be reached at jsmydo@post-gazette.com or 412-263-1548.