Contract for Hurricane Florence recovery cancelled due to improper procurement process

RALEIGH, NC (WBTV) - A seven-figure contract to help repair homes damaged by Hurricane Florence was cancelled in late December, a little more than a month after it was awarded, due to errors in the procurement process.

North Carolina Emergency Management awarded a contract to AECOM to administer a program funded by the US Federal Emergency Management Agency called the Sheltering and Temporary Essential Power Program.

The program, more commonly known as STEP, was designed to make minor and temporary repairs to people’s storm-damaged homes to allow them to move back in.

AECOM was awarded the contract at the conclusion of an evaluation process in which an independent review panel assessed the bids of at least companies that competed for the project.

The decision to award the contract to AECOM was the subject of a protest from a rival company that bid called IEM.

Related: Questions about previous work emerge for company hired for Hurricane Florence recovery

The bid protest said the evaluation committee had improperly calculated several parts of the evaluation criteria, including the way it awarded points based on overall project cost.

In a letter sent on December 21, 2018, North Carolina’s State Purchasing Officer, Odessa McGlown, upheld the protest on the basis of improper calculations.

“After considering the arguments and information presented during the protest meeting and the record of the procurement process, it is concluded that NCEM erred in calculating the cost information provided by H2Bravo; in calculating the cost scores for AECOM and IEM; and in the way it averaged and rounded the technical scores, and that these errors affected the outcome,” McGlown wrote.

McGlown’s letter recommended the contract be vacated and that the bid be re-issued due to the number of problems with the process used to evaluate the first round of bids.

“NCEM shall develop clear and objective criteria with respect to the technical and cost evaluation methods under guidance of the Division of Purchase & Contract,” McGlown wrote.

The decision in the Hurricane Florence-related contract for the STEP program is the second time in 2018 questions have been raised about the way in which NCEM awarded a contract for hurricane relief.

In July, a WBTV investigation uncovered efforts by senior NCEM officials to alter bid documents for a large federal contract to fund recovery efforts for Hurricane Matthew.

Related: State officials tried to alter bid documents for multi-million dollar hurricane contract

That contract was awarded in late spring, after the state had been labeled a ‘slow spender’ by federal housing officials because of the state’s failure to immediately begin spending more than $200 million of a federal grant designed to permanent repair or replace homes damaged in Hurricane Matthew.

The cancellation of the first contract to administer the STEP funds awarded in the wake of Hurricane Florence could mark the first substantive delay in recovery efforts for Hurricane Florence.

It is not clear when NCEM will be able to re-issue the bid, hire a company and resume work on the STEP program.

An NCEM spokesman issued the following statement in response to a request for an interview for this story:

“North Carolina Emergency Management (NCEM) continues to work with volunteer organizations currently repairing homes to ensure the NC Sheltering and Temporary Essential Power (STEP) program moves forward without interruption, enabling eligible homeowners impacted by Hurricane Florence to return to their homes as quickly as possible.”

“So far, voluntary groups including NC Baptists on Mission and United Methodist Disaster Relief have completed repair work on 20 homes, work is in progress on another 31 homes and next week more homes will be assigned to voluntary groups to begin work.”

“The Department of Public Safety received notice of the decision of the North Carolina Department of Administration (DOA) Division of Purchase and Contract regarding protests filed over the program management contract award for the STEP program. DPS, in coordination with the DOA Division of Purchase and Contract started immediately addressing the concerns outlined. DPS has developed a new request for proposals (RFP) which is currently under final review and will re-open the bid process in the next few days.”

“While the program management contract is being re-bid, home repair work is continuing uninterrupted. AECOM will continue to work on several tasks pursuant to a transition clause in the contract while NCEM rebids the contract. This will allow NCEM to remain on track with completing the work expeditiously.”

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