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Inside City Hall: $6.3M for consultants, $667K for accounting error

Details of the major contracts awarded by the Board of Estimates – where the money is going and for what.

Above: Facing the camera (l-r), BOE members Joan Pratt, Jack Young, Stephanie Rawlings-Blake and George Nilson at Wednesday’s meeting.

Consultants shared $6.3 million in contracts approved by the Board of Estimates yesterday, while the exact cost of correcting an accounting mistake made by the city’s Finance Department was revealed – $667,300.

In its final session of the year, the board also approved $1.6 million for manhole inspections and database inventory, $1 million for office furniture for city agencies and $259,500 for lactation consultant services provided by a local employment agency.

The contracts were approved collectively by the board, which consists of Mayor Stephanie Rawlings-Blake, City Council President Bernard C. “Jack” Young, City Comptroller Joan Pratt, City Solicitor George Nilson and Public Works Director Alfred Foxx. Several members abstained from voting on some of the contracts.

Here are details of the contracts awarded:

Accounting Mistake vs. Rec Centers

The cost of fixing the city’s 2010 Comprehensive Annual Financial Report (CAFR) – a document used by rating agencies to determine the city’s credit rating – was buried on pages 89 and 129 of the BOE’s 130-page agenda.

The board approved $542,500 to Ernst & Young to reinstate the fiscal 2010 report and $124,800 to KPMG to correct the beginning balances of the 2011 statement, for a total of $667,300.

(To put in context: the $667,300 going to the accountants would more than pay for the $300,000-$400,000 shortfall in the city’s Recreation and Parks budget, which has caused all the controversy involving the possible closure of some rec centers.)

The reinstated CAFR will not affect the city’s credit rating, but does mean that the government’s total assets, including bridges and roads, are about $265 million less than previously thought because depreciation was not included for certain fixed assets.

In a statement to the rating agencies, Finance Director Edward J. Gallagher said the mistakes were made by the city’s accountants and not Ernst & Young, the external auditor of the 2010 CAFR.

Young voted “no” to the Ernst & Young expenditure; all board members approved the KPMG allocation.

Lactation Consultant Services

This contract involves the renewal and increase of a 2009 award to Kennedy Personnel Services for registered nurses to help breastfeeding mothers as well provide nutritional aid.

Including yesterday’s approval of $259,500, the contract will total $519,000 and run through December 2012, with two 1-year renewal options remaining.

The contract is federally funded and administered by the city Health Department’s WIC (Women, Infants and Children’s) program, which seeks to encourage low-income women to breast feed.

Water Consultants

A total of $4,736,847 was awarded yesterday to four consultants doing specialized work for the bureau of water and wastewater.

By far the largest contract – $3 million over three years – went to Raftelis Financial Consultants, a Charlotte, N.C., company that has done financial consulting for more than 400 water utilities, according to its website.

The company will help the water bureau determine the cost and rates of its water service, including “the cost of providing water to Baltimore County, assisting with inter-jurisdictional cost sharing issues, developing cost of service and rate recommendations, and providing debt assurance support.”

Two black-owned businesses, Peer Consultants and King, King & Associates, will share 27% of the contract, while Nicole M. Harrell, a certified women’s business, will receive a 9% share.

The three other water contracts awarded were:

• $999,822 to Dewberry & Davis, over two years, to provide water design and engineering services for the rehabilitation of existing water mains, including preparing contract documents and cost estimates.

• $422,390 to Johnson, Mirmiran & Thompson to study and prepare plans for improvements to the headworks of the Back River Wastewater Treatment Plan to handle high water flows. Baltimore County will chip in another $422,390.

• $314,635 to Louis Berger Water Services for helping water bureau inspectors in “code compliance, field inspection and recordkeeping” of the on-going $117 million denitrification project at the Patapsco Wastewater Treatment Plant.

$1.6 Million for Manhole Consultants

The board also approved two “on-call” contracts for the same project, awarded to the same consultants, sought by the city Department of Transportation:

• $992,852 to KCI/STV Joint Ventures “to complete the Automation and Data Entry Services for the remainder of the 14,100 manholes in the existing GIS [Geographic Information Systems] database and the additional 200 manholes identified by the city.”

• $661,782 to KCI/STV Joint Ventures for “manhole inspections, attend progress meetings at the Conduit Division office, supervise inspection crews and allocate appropriate resources to complete the inspections, collate file folders with photographs and scans for download to the city’s on-base system.”

Office Furniture

The BOE approved a $1 million increase to a $4 million contract approved in 2008 to supply office furniture and equipment to city agencies.

A total of 17 companies are listed as suppliers under the contract. Each company has agreed to allocate 5% of their award to minority business enterprises (MBEs) and 0% to women business enterprises (WBEs), according to the board’s agenda.

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