Mayor Richard Daley’s top aide on Friday announced new oversight of big-money contracts as part of a move to shore up troubled city purchasing procedures.
The action came four days after the mayor acknowledged procurement problems and promised reforms following evidence of irregularities uncovered by a Tribune investigation into G.F. Structures. The politically connected firm has won more than $55 million in city business under the Daley administration.
Meanwhile, Daley got heat on another contracting front. As he addressed a breakfast gathering commemorating the birthday of Martin Luther King Jr., African-American demonstrators marched outside complaining that blacks are being shortchanged on public projects and jobs.
“We just feel that Dr. King would be standing out here with us,” said Calvin Omar Johnson, head of the Work-Ship Coalition, a West Side advocacy group.
At City Hall, Julia Stasch, Daley’s chief of staff, announced that Mark Jiambolvo, currently finance director in the city’s Transportation Department, will head a new Purchasing Department unit that will monitor whether items being ordered by various departments match the items and prices specified in the contractors’ bids.
The oversight will involve “work unit contracts,” pacts that allow contractors to perform work as ordered, usually by multiple city departments, at agreed prices.
The Tribune’s investigation found that once G.F. Structures won such a contract in 1997 to provide fences, the firm was allowed to substitute materials, using a more expensive type of ornamental iron fencing than what was specified.
Also, city staffers routinely added costly items to the contract, such as ornamental iron planters, that were not originally specified.
More Top Picks Best Balance Boards For Kids
G.F. Structures has been paid about $10.5 million under the pact, providing its products to the city’s General Services, Transportation and Aviation Departments.
“On citywide contracts, we seemed to lack a single point of contract administration responsibility,” Stasch said in an interview. “I want to immediately set up that single point of responsibility.”
The new oversight unit will monitor over 100 contracts now in force worth more than $100 million. If proposed work doesn’t conform to the bid, the departments must seek change orders or have the contracts rebid.
“I think we need to move quickly to give people confidence we are dealing with this,” Stasch said.
Any proposal for a contractor to do more than $5,000 worth of work at a time must be reviewed by both the user department and an official of the new Purchasing Department oversight unit. Review by the oversight group is to take no more than two days.
After the Tribune’s revelations of questionable practices involving G.F. Structures, Daley ordered Stasch to review all purchasing procedures, using outside help from Arthur Andersen and other private companies.
The firm of Altschuler, Melvoin and Glasser has been hired to review contracts and bills submitted by G.F. Structures and a sister company, Builders Chicago, which has done $32 million in business since Daley took office in 1989.
In his speech at the King Day commemoration at the Chicago Hilton & Towers Hotel, Daley promised “important changes” in another area in which he is under fire: the city’s set-aside program for minority and female owned firms.
A caucus of 14 African-American aldermen, unhappy with what they contend are paltry city contract awards to black-owned firms, agreed on Thursday to step up the pressure on Daley’s administration for a bigger piece of the pie.
Daley said after his speech that he has no problem with those who met in the South Side offices of Ald. Dorothy Tillman (3rd), or with their demand for more city contracts for African-Americans.
“We are working with them,” he said. “Our struggle is to get more African-American contractors. You know that. They know that, too.”
Daley is particularly sensitive about minority contracting after a recent review by city officials substantiated the findings of a 1999 Tribune investigation.
The Tribune found that Windy City Maintenance, a janitorial company purportedly operated by a woman that has won millions of dollars in contracts under the city’s affirmative action program, in fact is controlled by the politically connected male members of the Duff family.
John Duff Jr., the family’s patriarch, is an ex-convict with ties to organized crime figures.
African-American leaders contend that companies that falsely pose as minority- or woman-owned siphon money away from bona fide minority and female firms.