Monday, September 15, 2014

Furniture company rep to state auditor: Fix was in on Joplin school bids

The fix was in when it came to furniture bids at the new Joplin Schools, a furniture company representative claims in a letter to State Auditor Thomas Schweich.

In the letter, a copy of which was sent to the Turner Report, John Howsmon, a workspace consultant with Scott Rice, accused Joplin R-8 officials of "conflict of interest, at best, and outright collusion at worst."

Howsmon says, "It is disheartening to say the least when you invest time, money and energy to win business only to find out that the game is fixed against you."

The letter is printed below:


Monday, September 15, 2014
Thomas Schweich
Missouri State Auditor
301 West High Street
Office 880
Box 869
Jefferson City, MO 65102

Re: Joplin School Audit

Mr. Schweich,

I would like to make specific comments on an article that recently appeared in the Turner Report. After reading this and other articles regarding the Joplin School Bids, I feel compelled to reach out and provide additional facts regarding these specific projects. As one of the vendors who took the administrative team on a trip to visit Steelcase in Grand Rapids, MI, I can speak directly to this issue.
http://rturner229.blogspot.com/2014/09/germany-trip-catches-attention-of-state.html

Turner Blog:
State auditors conducting a forensic examination of the Joplin R-8 School District have been closely examining a 2012 fact-finding trip to Germany taken by former Assistant Superintendent Angie Besendorfer and Executive Director of High School Instruction Jason Cravens, administration sources have told the Turner Report.

It already looked like a breach of ethics for furniture companies seeking to land contracts to equip the district's new schools to pay for district officials to come to their facilities, but even worse was when a company with a facility in Charlotte, North Carolina, decided to pay for Besendorfer and Cravens to come to its headquarters in Germany because it had a "bigger showroom" there, according to Besendorfer.

That company later received a single bid contract for furniture for East Middle School, Soaring Heights Elementary School, and Irving Elementary School.

As the Joplin Globe related in its Oct. 27, 2012, edition, the German manufacturer,
VS Verenigt Spezialmobelfabriken, paid for Besendorfer and Cravens to come to Germany for two days at the beginning of October. The two took their spouses, according to the Globe article (the spouses paid their own way) and took a couple of vacation days sightseeing in Germany after seeing the furniture.

Plus, as Besendorfer noted, they had a chance to play with the furniture and jump on it, like schoolchildren might.

All of the school officials interviewed by the Globe said there was nothing wrong with allowing the company to pay for the administrators' trip and for whatever else was paid for while they were in Germany.

Board member Randy Steele, who was board president at the time, said the trips made no difference because "the bid comes to us, so we, as the board, make that decision, not the person who went on the trip."

Superintendent C. J. Huff told the Globe, "The district is obligated to accept the lowest qualified bid."

The board approved a contract for $59,107.07 to provide the furniture for the schools. The reason V/S was the only bidder- "V/S is a single source provider of furniture for some products that meet the needs of our learning spaces."

As Besendorfer told the Globe, "I'm confident we have done nothing inappropriate."

It will be interesting to see if the auditors agree.

As both a vendor and a tax payer I agree that “there was nothing wrong with allowing the company to pay for the administrators' trip and for whatever else was paid for while they were in Germany.” Steelcase, the company that I represent has a vast product offering and getting a prospect to invest the time to travel to any company’s headquarters is a great way to introduce them to the vast array of products and services offered.

Where I would disagree is with “Board member Randy Steele, who was board president at the time, said the trips made no difference because "the bid comes to us, so we, as the board, make that decision, not the person who went on the trip." This statement is predicated on the bid that the board is reviewing has been developed by an independent 3rd party and all participating vendors are competing on a level playing field. This was not the case in the furniture selection for the Joplin Schools. This is either a conflict of interest at best and outright collusion at worst.

The core questions is “is it legal for the school district to enter into a design / build agreement with a vendor?”

The vendor who won the bid, also developed the bid specifications and when they did, they contacted each manufacturer ahead of the bids being let to register each bid with the appropriate factory. This enabled them to lock into preferential pricing that was not made available to other vendors. This process put Scott Rice as well as all other vendors who wanted to bid on the furnishings for the schools into a noncompetitive position. This was a design build agreement which put the company I represent as well as all others in an uncompetitive position.

How many different architectural firms and design teams were paid by the school district to design the various buildings that were put out for an open market bid? Why did the administrators not award an Interior Furnishings Contract to one or more of these design teams? This would have enabled the school board to actually receive a bid that was based on an independent evaluation of what is in the best interest of the school, not a single vendor’s opinion. A vendor who not only specified products they were in the best position to sell but who also locked into preferential pricing with the factories that were specified so that other dealers were not allowed to compete on a level playing field.

When a bid comes out that is the work product of a competitor who registers all these products with the various manufacturers in advance, it is ridiculous. The bid request I received was a sham to support a decision that was already made by the people who directed SSI to develop the bid. It would have been a waste of time to enter a bid to justify a decision that had already been made.

It would be interesting to see how many companies bid on the furnishings for the Joplin Public Schools.

My comments are not an indictment against the people involved in this decision, only the process that was followed. It is disheartening to say the least when you invest time, money and energy to win business only to find out that the game is fixed against you.

I feel providing these additional facts will likely remove Scott Rice from further business opportunities with Joplin Schools but since all bidders were not on a level playing field, any proposal that we submitted would not have been competitive and will further act to justify a decision that had already been made.

My name is John Howsmon and I am a Workplace Consultant for Scott Rice.
john.howsmon@scottriceok.com
417.529.1630 c www.scottriceok.com www.steecase.com
Sincerely,
John Howsmon

2 comments:

Anonymous said...

Good for you John. I believe if more people would come to the surface they will find out that they are not the only ones that were treated this way. For Randy Steele to say the Board decided what furniture they were going to use in 3 schools is ridiculous. It was in the consent agenda and yes the board agreed but they didn't do any work. They are supposed to work for the taxpayers and not the administration!!

Anonymous said...

Of course it was a single-source vendor since V/S was the only company that manufactured furniture to the EXACT specifications developed by V/S.

Anybody at Joplin R-8 responsible for ordering knows how to steer business to their preferred vendor and get around the three-bid process. This was just on a much larger scale.