Monday, November 29, 2010

Avoiding Conflicts of Interest When Selecting Consultants

What is the relationship between your selection committee members and the consultants who submit proposals?  What is the nature of the relationship between your project manager and the selected consultant?  

Personal Relationships with Consultants:  In many cases, government employees know the consultants who are proposing, often having worked with them in the past.  But what if the project manager or other evaluators also have a social relationship or personal friendship with any of the consultants submitting proposals or with the selected consultant?  Does that create a conflict of interest or the appearance of a conflict of interest?

Contract Termination:  The City of Sammamish, Washington recently terminated a $30,000 consultant contract for an environmental study to establish the "ordinary high water mark" for Lake Sammamish, after it was revealed that the city's project manager was a personal friend of the consultant.  In addition, the city's project manager was a member of the selection committee, and just prior to the selection process, the city's project manager had invited the consultant onto the city employee's boat.

Keep it Squeaky Clean:  In announcing the contract termination, in which the consultant will keep $20,000 for work already performed, Deputy City Manager Pete Butkus stated: "We want to make sure this is squeaky clean."  The study is "a very emotional issue for many people and we want to make sure it is technically correct and there's not anything that would allow someone to question the results."

Costly Relationship:  The city will start over with a new selection process, a different city project manager, and a new contract that will be for the same study as the terminated contract.

More Information:
Practical Tip: As part of the selection process, require each evaluator to sign the evaluation form with their scores.  The evaluation form should include a statement that the evaluator does not have a conflict of interest (financial, relational, or other nature) with any of the firms being evaluated or key personnel of any of the firms, and that there is no perception of a conflict of interest that could arise from any relationships.
Mike Purdy's Public Contracting Blog 
© 2010 by Michael E. Purdy Associates, LLC

No comments: