Department of Labor officials awarded a $200,000 contract to promote a book club without engaging in competitive bidding, paying double what was budgeted for the project and neglecting to keep tabs on the winning contractor’s performance or hours worked.
Potential bidders had only 29 hours to prepare and submit bids, though “the department did not provide any evidence for why it could not have waited longer,” according to a new investigation by the department’s inspector general. The investigation was requested last year by then-Sen. Tom Coburn, R-Okla.
Labor officials limited bidding to advertising firms it already had on retainer, and which had experience with multiple languages and other criterion that had nothing to do with the book club assignment. That left a pool of two.
The contract was awarded to Concepts Inc., a Maryland public relations firm, after the other potential bidder was unable to provide a complete response in 29 hours.
The contract was awarded by Carl Fillichio, a politically appointed public affairs confidant of Secretary of Labor Thomas Perez and his spokesman, but was recorded as a contract under the Office of Disability Policy.
It “had nothing to do with promoting disability issues but the book club Fillichio started and chairs … Hiding the contract on another agency’s payroll was [standard operating procedure] for Fillichio — that way he could semantically answer a Hill/media FOIA and say he had no such contracts,” a Labor employee with knowledge of the situation told the Washington Examiner. The employee requested anonymity.
Labor paid Concepts $120,000 under a fixed-price contract that required the work to be done for the stated price, regardless of how much time was required to do so. But then the government also agreed to begin paying an hourly wage on top of the fixed price for the same work, adding $89,000 to the cost.
Concepts essentially wrote its own job description. “The first requirement of the statement of work was to develop the requirements. This was not appropriate because well-defined requirements in a statement of work are necessary for the Department to hold a contractor accountable and ensure it receives the services for which it paid,” the inspector general wrote.
The contractor was paid monthly rather than upon completion of particular tasks, and without having to provide an accounting of hours worked. Indeed, Labor may never have checked the work.
“The department was required to verify 100 percent of the performance elements completed. However, there was no evidence that this had occurred. As such, there is no evidence DOL received the required services,” the inspector general said.
Coburn became concerned about contract after reading media reports that Labor had spend hundreds of thousands of dollars on gay rights documentaries, poetry competitions and the book club in a campaign to garner positive publicity for the labor department on concerns unrelated or only marginally related to its official purpose. This Washington Post article was published as a result of the campaign.
The campaign was geared primarily to Labor Department employees, however, and included hiring a mascot to cheer up employees during the 2011 sequestration battle in Congress.
