The D.C. government terribly mismanaged the contract for legal services at the new Nationals’ stadium, a scathing new audit reveals, but the D.C. Council on Tuesday moved to continue the deal anyway.
The price tag for legal work, performed by law firm Venable LLP, is now millions more than anticipated and is threatening the $611 million ballpark cost cap, D.C. Auditor Deborah Nichols found.
Venable was awarded the contract in 2005, during Mayor Anthony Williams’ administration, for one year plus four option years, at no more than $950,000 annually. But the Office of the Attorney General and the Office of Contracting and Procurement “did not develop and document a realistic projection of costs, or the source and amount of funding available for such services,” the audit reported, and no one in any agency monitored the deal to ensure the firm’s billings were appropriate — many were not.
“It appears that all of these matters were unclear, unsettled, or not realistically considered prior to and during the contract solicitation phase or the base year of contract performance,” Nichols wrote.
The D.C. Council nevertheless approved an emergency resolution Tuesday to pay Venable up to $3.8 million over the next two years “in support of the District’s eminent domain litigation to determine the amount of just compensation due to the owners of parcels of land on the ballpark site.” The firm has performed many hours of discovery in preparation for mediation and trials expected to start later this year.
The city used its eminent domain authority to seize dozens of parcels for the stadium project. At least 17 landowners now are suing over what the city should pay for those properties.
Council Chairman Vincent Gray moved the resolution with “great reluctance,” he said. The city is in too deep to back out of the Venable deal now, Gray said; it has no ability to take the services in-house; new Attorney General Linda Singer revised her office’s procedures for monitoring any contract for outside legal services; and the people responsible for approving and handling Venable under the Williams’ administration are off the case.
“I have frankly not seen ever in my service a contract more poorly administered than this one,” Gray said.
Venable’s fees for the base year totaled $1.19 million. The city expects the firm to charge as much as $2.2 million before Oct. 1 and up to $1.6 million during the second option year, which would run into 2008.
Other audit findings
» Venable performed services without being issued task orders in violation of the terms of the contract.
» The Office of the Attorney General failed to appoint a project manager or contract administrator as required by municipal regulations.
» Invoices were not properly reviewed, and “there was no system of accountability in effect.”
» Venable overbilled the city for “inappropriate or improper charges” tied to incorrect hourly rates or ineligible expenses.
» The deal “may result in over-expenditure of the $611 million baseball stadium budget.”
