October 7, 2013

Hialeah awards millions of dollars in no-bid contracts

The city also agreed to more than $500,000 in change orders from contractors on a new municipal auditorium.

To speed up the construction of the new Milander Auditorium, the city of Hialeah granted more than $2 million in no-bid contracts to dozens of companies to finish the interior build-out, complete the kitchen and even buy curtains.

Those contracts represent a third of the construction budget for the auditorium, at 4700 Palm Ave., according to an El Nuevo Herald analysis of contracts granted since 2011.

Besides granting contracts without passing through an committee evaluation, the city also authorized more than $500,000 in increased purchase orders for about 25 contracts because, according to the administration, additional work that wasn’t part of the original plans was needed to finish the job.

In all the cases, the council voted unanimously in favor of the proposals.

Mayor Carlos Hernández said he wanted to speed up the project to celebrate in time for a Christmas inauguration last December. Despite the rush, the grand opening didn’t happen until June.

“Time was of the essence and we wanted to finish the job as soon as possible,” Hernández said. “But our priority was always to find the best quality at the best price in what was being purchased.”

However, critics of the mayor said that granting no-bid contracts has become a bad habit in Hialeah.

Julio Martínez, a former mayor who is running against Hernández in the November elections, said that no-bid contracts should be considered in cases of emergency, such as rebuilding work after natural disasters.

“What’s happening here is a mess,” Martínez said. “It’s preferable to be a little late than to give away all the contracts this way.”

El Nuevo Herald interviewed several contractors who have worked for the city, but none of them wanted to comment publicly about the process for fear of being hurting their chances at future contracts in the city.

However, one contractor said the city had “made a fool of me” when it accepted a proposal for a job at Milander that was significantly lower than his own bid. Months later, the city sought increases in the purchase order for work that wasn’t part of the original plan.

“If the plans are already drawn out, why add to them now?” asked the contractor. “If I present a bid, it is complete and there is no reason why it should be increased.”

Among the nearly 30 companies that received contracts without going through a public bidding process is one that belongs to a former business partner of the mayor’s in an action flick they produced together a decade ago.

WeGiveSoundAdvice Inc., a Fort Lauderdale company belonging to Peter Beshouri, received about $40,000 in city funds in March for the installation of an audiovisual system at the auditorium.

Hernández said that his friendship with Beshouri, with whom he produced the film Street Survival in 2004, was not a factor in the selection of the company.

“I didn’t even talk to Peter for that,” said Hernández, who was elected to the Hialeah council in 2005.

Beshouri did not respond to messages left on his phone and at his business last week.

In the months after granting the contract to Sound Advice, the Hialeah council approved two increases to the purchase order to the same company for another $58,000.

Vince Rodríguez, director of the city’s Construction Department, said that the additional purchases took place after it was known that the project was under budget. For that reason, That was the reason why it was authorized to purchase new audiovisual equipment “in order to make it more marketable and reduce staffing.”

No-bid contracts are given out through a closed selection process. Rodríguez said that his office keeps a pre-established list of vendors that he contacts to ask for a proposal for these selections. These contractors are asked to deliver their proposals in a sealed envelope at a specific date and time.

“Bidding takes much longer,” Hernández said. “We save time by not using bids, but it must be clear that there is always a concern of making sure that at least three proposals are presented to make the selection for each contract.”

In the case of Sound Advice, its offer was middle range. The other two were from Revelation Sound, of Miami, which offered to install an audio system for a little more than $75,000. The lowest offer was from Luviar Technologies, of Hialeah Gardens, for about $32,000.

Rodríguez explained that Sound Advice was chosen because of its experience in the market.

“The lowest bidder was a fairly new company with very little experience in audio systems,” Rodríguez said.

Hernández said that in all no-bid contracts authorized by the Hialeah council, his administration’s concern is to acquire services and equipment of quality at competitive prices, “allowing everything to be done within budget.”

In fact, when the project was close to being finished, Rodríguez said he notified the mayor that they were under budget, so that new improvements were authorized that were not included in the original plans, such as the additional audio equipment.

The largest contract granted without bidding was for the interior build-out. The company Builders Choice Restoration proposed doing the carpentry, floors and doors, among other works, for about $689,000, the lowest of the three prices offered.

The Hialeah council gave the contract to Builders Choice in November 2012. Then in April and June, the council increased the purchase order for a total of $93,000, approving the Construction Department’s request for final repairs and additional work that had not been included in the original contract.

Related content



Editor's Choice Videos