NO SECURITY IN ISLIP’S “ALARMING” BIDDING PROCESS…

Citing the Town’s “mistakes” Islip Town rejects lowest qualified bidder….TWICE


"I said there were mistakes made." Islip Town Attorney Alicia O'Connor admitted at a recent Town Board meeting about a security contract bid put out earlier this year.

World Wide Security owners in Garden City, hope the third time is the charm in their attempt to have their company’s low bid for a Town of Islip contract for Alarm Network and Maintenance and Service accepted.

Twice before their low bid has been rejected by Islip Town, even though World Wide Security (WWS),  executives say they fulfilled all bid requirements and both times they were significantly lower than the only other bidding company; Intellitec, of Westbury, which has held the contract with the Town of Islip for over five years.

Intellitec’s owner  claims the lower bid isn’t always the best financially, after factoring in other variables.
                                                                                                              
Town Supervisor, Phil Nolan also admitted at the meeting the Town had made errors in what he called "an important contract" saying, "We are acknowledging the mistakes and we are going to correct it."


           
                                                   THE FIRST BID...

Pat Mara and her husband Kenneth, owners of World Wide Security put their first bid in response to a request for bids by the Town, back in March of this year.  Originally they were told there were over 80 systems to monitor in about 40 or fifty buildings, but a complete list was not supplied until a week after the initial faxed request for bids was made, according to WWS.  There was a “pre-bid meeting” according to WWS executives, attended by Mike Patejdl, the Director of Purchasing for Islip Town, Jeffrey Hausner, from Intellitec and Michael Catalano, the Chief Fire Marshal for Public Safety Enforcement for Islip.  Also in attendance were WWS staff members Terri George, (who primarily handled the bid) Brian Macquade and Dave Young.

WWS staff and Intellitec were told the Town wanted to cut the cost of Fire and Security Alarm monitoring, currently handled by the Town.

At the time the town had just laid off approximately 39 workers.  WWS and Intellitec were told the Town’s system was “in good condition”.  The Town requested a10% bid bond (of the annual cost of the monitoring) and a one year performance bond at that meeting.   WWS did present a certified check to cover both that day.  Intellitec did not.  When Intellitec did not give a check, Mr. Patedjl returned the check to Ms. George saying the bond check was no longer needed.

Mr. Hausner spoke to Freelance Investigations and claims this was not a requirement.  “There was definitely not a bid bond required, because I called to check and they told me no.  If you go through the document there is nothing there that says you need a bid bond -I could get one overnight if necessary.  They only specified that the successful securities contractor provide a performance bond.”

Part of the specifications for the bid were that there would be no sub-contractors to be used and the company must have a NYC Fire approved Central Station which requires at least two persons manning monitors at all times 24/7 365 days a year.  WWS executives claim their bid has that and that Intellitec does not.

Mr. Hausner, said this is not an issue as Intellitec has Rapid Response Monitoring,  “ Rapid Response Monitoring is a NYC Fire approved Central Station", according to Mr. Hausner.  "We admit Rapid Response is a subcontractor, but so is Vision Monitoring, another company under WWS.”

Ms. Mara claims it is not the same. “In our bid submittal we submitted the bid as WWS and Vision Monitoring together.  They did not, with no mention of Rapid Response in Syracuse at the outset.”

Mr. Hausner countered,  “Rapid Response was printed on the initial bid provided to the Town. The subcontracting had nothing to do with the monitoring and WWS was not a certified dealer and did not have the certifications for Bosch Radionics and Mirtone, which really was the issue.”

Mr. Hausner added 90% of the Towns’ equipment is Bosch.

WWS said Vision Monitoring is a certified Bosch dealer and supplied Freelance Investigations with their certificate as verification.

Mr. Hausner insisted this was the real issue, that WWS does not hold the certification, Vision Monitoring does.

*************************************************************************
WWS first Bid on 88 sites (55 Burglar Alarms and 33 Fire Alarms) was:
$2,261.60/ month for monitoring ($29,264.20/year)
Hourly rate:  $100 for the first half hour; $50 for the next quarter hour for regular service.

Emergency service: $150 for the first half hour and $75 for the next quarter hour.
Central works 2000 computer support fee was $500/year
*************************************************************************
Intellitec bid:  $2,518.65/month  ($36,598.80) for monitoring
Hourly rate: $ 98.00 for the first half hour; $30 for the next quarter hour.
Central works 2000 computer support fee was one dollar.

Emergency service $150 for the first half hour; the next quarter hour $45 dollars.
******************************************************************************
Jeffrey Hausner told Freelance Investigations:

After the bid came out I did an analysis on the service calls that the town had done and I came up with based on these figures and the Town’s needs from January 1st to April 30th, WWS even with their less expensive monitoring combined with their Emergency services they would have been $12,000 more than Intellitec. For the year that translates to approximately $36,000 minus the $3,000 for the difference in monitoring fees, we would still have been about $33,000 less than WWS. 

WWS claims the $7,334.60 difference… made Intellitec the higher bidder.

WWS:

At the time WWS asked for an approximate total of service hours to base their hourly rate on, we were told by Mr. Patadjl to just give a single hourly rate.  When the bids went in however, WWS was told the rate should have been based on approximately 750 hours of service. That according WWS made Intellitec, appear to be the lower bidder.

After the bidding process ended, Ms. George called the Town and asked why they hadn’t been awarded the contract even though they were the lower bidder and was told about the hourly discrepancies and other issues were brought up as a reason to award the bid to Intellitec.  Ms. George informed the Mara’s, owners of WWS/Vision Monitoring and Mr. Mara objected to the process.

Mr. Hausner claims on the first bid, based on the hourly rates, his bid would end up being lower.  “They did not fulfill their certificate requirements. It is monitoring, plus an hourly rate there are two components.  When combined our bid was lower.”

In May, the Vice President of Intellitec, Jeff Hausner, a Nassau County resident, made a  $250 contribution to the Friends of Phil Nolan.  Hausner admitted he made the contribution at a cocktail party and said he grew up in Ronkonkoma and as such had lived in Islip Town, so it was not unusual for him to contribute.

In June the Town of Islip announced they had decided to rebid the job again.

Before the second bid, the Town Attorney’s office called WWS to set up a meeting with Mr. Catalano, (Fire Commissioner) and Mr. Lawrence (Larry) O’Leary, the Public Safety Commissioner for Islip and head of Code Enforcement for the Town, for the next day.  With little notice, the owner and president of WWS, Kenneth Mara, the bids’ administrative project manager’ Terri George and two others from WWS drove to Islip from Garden City, where their firm is located, and said they were told when they were five minutes away that the Security Commissioner (O’Leary) could not attend and the meeting had been canceled.
Mr. Hausner said he was not privy to this meeting.
                                                                                                                  

                                              THE SECOND BID...

The Town told Ms. George (WWS) that they had decided to re-bid the project (in June).

The second set of bids were:
**********************************************************************
World Wide Security:  $81,180.70             $2513.00/monthly monitoring fee
$50/for the first half hour $25 for the next quarter hour
$500 went to zero on the support fee
Emergency Service to $55/hour  and $27.50 for a quarter hour.
**********************************************************************
Intellitec:  $118,866.80                               $2179.80/monthly monitoring fee
$98/for the first half hour; $30/next quarter hour.
Support Fee: $1 dollar
Emergency Service Fee: $155/hour $45/next quarter hour
**********************************************************************
After the numbers for the second bid were in, Mr. Hausner questioned how WWS could pay their people with these numbers.  “I kept my prices the same except the monitoring which I dropped and I only raised the Emergency Service fee five dollars so I wouldn’t lose money on an emergency call.”

Ms. Mara, Vice President of WWS, responded, “How we pay our people should be of no concern to Mr. Hausner.”  At the Town Board meeting Ms. Mara indicated that her company is required by law to pay prevailing wage of $35 to $65/hour, that her contract bid was for $100/hour and that currently Intellitec was getting $200/hour from the Town of Islip for the service they have provided since 2006.

Mr. Hausner also noted,  “I’ve lost hundreds of bids because I was not certified in a particular product as a dealer.  This is the normal course of business.  WWS was not certified in Bosch period.” said Hausner, something WWS denies.

According to the specs, WWS or Intellitec would be required to handle over 88 systems including Bosch, which was also required by the Town in their specs, even though it’s like requiring the antiquated DOS system for your computer, according to Ms. George of WWS.

Mr. Hausner disagreed, calling the Bosch technology different, but complex and since according to him at least 90% of the Town’s ageing equipment is Bosch, Mr. Hausner agreed it was necessary to be Bosch certified, which he again claimed WWS is not.

A letter from Bosch Security Systems, dated March 26, 2010 Re: Certification-Bosch Security Systems Authorized Dealer stated that Vision Monitoring of Garden City is a certified Bosch dealer in: Intrusion Systems, Fire Systems and CCTV Systems.

 Mr. Hausner again insisted, "WWS does not have the certification-Vision Monitoring does."

After the second Bid WWS claims they were nearly $40,000 dollars lower than Intellitec, but again, they were not awarded the bid.

Forced to give an hourly rate, WWS came in at $100/hour compared to Intellitec’s  $196/hour.
However, Mr. Hausner claims when you add up the numbers, Intellitec's actual hourly rate comes down to $158/hour and when other variables are factored in, according to him, it is really less expensive.  WWS disagrees with that assessment insisting they have been the lower bid both times.

No winning bid was chosen again.

Calling WWS’s bid “non-responsive” Alicia O’Connor, the Islip Town Attorney, spoke to WWS the next day.  WWS said Ms. O’Connor told them they were not awarded the bid because they did not meet all the requirements.  WWS insisted they had a Central Station on their premises and that Intellitec did not and invited her to take a ride to Garden City so they could show her their Central Station on their facility that very day.  Ms. O’Connor declined saying “We’re not required to do that.”  In the phone conversation Ms. O’Connor was claiming the process was now “too confused”, according to Ms. Mara V.P. of WWS, a claim Ms. Mara reiterated at the September Town Board meeting saying "These were your bid specs and the Town of Islip is now paying $40,000 dollars more a year because you're confused?"

Ms. O'Connor responded at that meeting, "I didn't say the Town was confused, I said there were some mistakes in the bidding process, which we have reviewed." adding that it was in the "Town's best interest and in compliance with the law" to rebid a third time.

After the second bid,  Mike Patdjl told WWS that Ms. O'Connor told him to tell WWS they were not getting the bid because they didn’t submit a certificate of insurance, according to Ms. George.  This despite the fact that it was clearly stated in the bid papers that only the successful bidder needed to submit their certificate of insurance, so therefore, not until a bid has been awarded would it be required, according WWS.  Even Mr. Hausner agreed in our phone interview that WWS didn’t need one.  Mr. Hausner said he had included it in his package anyway, because it is a simple form, "documenting my ability to obtain insurance."  Ms. O'Connor's office declined to answer the question about the insurance requirement or any others regarding the bidding process sent to her office by Freelance Investigations.

At a Town Board meeting in August, Ms. George, from WWS asked the Board for a private meeting to discuss the issue and the Board agreed.  The next morning, according to Ms. George, without ever having confirmed a date or time for the meeting at 11:30 AM the Town Attorney’s office called her and said her firm missed the meeting that they said was supposedly scheduled for 11:00 AM.  Another meeting was hastily scheduled for 1:30 that afternoon attended by; a different fire marshal, Larry O’Leary, Alicia O’Connor, her legal assistant and members of the WWS team.

The Town was informed by WWS that the Towns’ own bid specs were to include a N.Y. City Fire approved Central Station, which WWS  says they do have and that Intellitec does not.  Intellitec was planning to use Rapid Response Monitoring System in Syracuse, as their Central Station.  WWS believe this violates the provision of no subcontracting, because even though the owner of Rapid Response also owns a piece of Intellitec and does business with them, it is still considered a separate company and as such is considered a subcontractor.

WWS claims Vision monitoring is not a subcontractor, it is a company wholly owned by WWS,  the same owners.

Mr. Hausner says his part ownership of a small piece of Rapid Response is the same as WWS owning Vision Monitoring, which he claims is also technically a separate company and as such is also a sub-contractor.

WWS owner Pat Mara spoke with Freelance Investigations recently about the myriad of problems with the bidding process itself.  Ms. Mara claims that some of the specs required by the Town made no sense.   For example, the Town required the company to be S.I.A. certified.  This course is not even given any longer.  They also required the use of a Mirtone Dealer (made by G.E.) as a necessary “proprietary” supplier, despite the fact that it is not a proprietary dealer as G.E. sells Mirtone Vigilante to another company, according to Ms. Mara.

Mr. Hausner said Intellitec has $40,000 dollars worth of Mirtone parts available 24/7 in an emergency.  "Intellitec can provide them at a moments notice.  WWS would have to acquire these parts third hand and on a weekend in an emergency, that would be difficult if not impossible to accomplish."

In a letter to Islip Town Councilman Steven J. Flotteran (Rep,) WWS Vice President, Pat Mara discussed the concerns she had with the bidding process with the Town of Islip.
“We are a strong company who are reputable and work for some of the largest organizations in the world. I followed the bid specifications to the letter.” Ms. Mara wrote.

Ms. Mara offered to replace the Mirtone Alarm equipment that is in two Town Hall Buildings free of charge if they could not repair or replace it and that they would guarantee they would use brand new Honeywell Equipment, (the world’s largest supplier of fire and security equipment).  Ms. Mara cc’d the letter to the members of the Town Board, inviting Phil Nolan, the Town Supervisor and the rest of the Board to visit their facility and see for themselves, that they do have a NYC Fire Department approved Central Station.  Ms. Mara said no one took her up on the offer.

WWS provided the documentation to Freelance Investigations to support their claims and gave Freelance Investigations a tour of their facility in Garden City, including their on premise Central Station, which contained state of the art modern technology and was manned by two employees at the time.

Mr Hausner sent Freelance Investigations a link to a virtual tour of Rapid Response, their state of the art, Central Station Monitoring facility located in Syracuse, New York.

American Securities Technologies Inc. D/B/A WWS does business with a wide range of clients including the government, West Islip School District, the Town of Hempstead, Nassau County and NYC Department of HRA at over forty locations.

Mr. Hausner declined to name any of his clients stating, "We are in the security business and the last thing I would do is reveal a client due to security concerns."

On September 23, 2010 Patricia Mara sent a letter to Islip Town Attorney, Ms. O’Connor requesting a definitive answer on the second set of bids.

At the last board meeting a number of issues were addressed regarding the use of sub-contractor and licensing.  I am sure you have been able to verify that Intellitec does not operate a central station at their location, which was a requirement of the bid specifications.  You should also have been able to confirm that Intellitec was going to be using Rapid Response as a “sub-contractor” for the central station monitoring, which is in violation of the bid specifications.  Intellitec is not certified as a NYC Central Station Signaling Company, which would make Intellitec “non-responsive” to the bid.

Mr. Hausner insisted, "Nowhere in the request for proposals does it state that the bidder must operate the Central Station at their location."  adding "We provided the name and address of Rapid Response in the initial bid papers as well."

The letter was sent in advance of the recent September 28th Town Board meeting where Ms. O’Connor admitted on the record that the Town had made mistakes in the specifications and the process itself was flawed for the second time, though she declined to specify what the mistakes were.

After the second bid went out, we found there were some mistakes, not only in some of the bid specifications, but in the actual document we had prepared.  There was some information not put into the bid documentation that would specifically go into a maintenance/service contract and they were not there.  So we need to do it again we need to re-draft the specifications.             (Ms. O'Connor/ September 28, 2010)

No one disputes the quality or the credentials of either company.  Mr. Nolan admitted for the record at the September meeting that both sides have "great expertise" and he insisted "This is an important contract that we are looking at in totality."

                                                      THE THIRD BID…


The Mara’s and their employees say they have invested so much time and energy into this bidding process so far it is really a question as to whether it is even worth it to re-bid.  Ms George called the process "unjust" and "it is nothing like I've ever seen before." at the Town Board meeting, adding her company put in over 200 hours of time and energy on the bidding process so far.  According to them, the anomalies of the process itself need to be exposed.

Mr. Nolan responded, "We've given it an even handed negotiation, what more do you want?"

Terry George also asked at the September 28th meeting why Mr. O’Leary and the Fire Commissioner were at these meetings and not just the purchasing agent as is her experience in the 27 years she has been working creating bids in the industry.  Mr. Hausner said their presence at the meetings was "not out of the ordinary".  Ms. George asked of the Board, "I'd like to know what's missing and what errors you found.  I'm concerned because normally the other bidders try to get the lowest bid thrown out."

Ms. George also charged the Town is purposely trying to throw out WWS even though they are the lowest.  "Intellitec doesn't have to say a word, because the Town Board members are doing the work for them."

Mr. Nolan insisted that "We're just trying to get the best outcome."  Saying "I'm not thrilled with bidding something three times...but if an error is correctable, then we should do it.  It's a simple as that."

No one knows when the next bid will be or if they will re-bid, according to owners of WWS and Intellitec.

“We may not even be invited to the next bid, if we are, we will bid unless the new bid specs are clearly aimed at Intellitec.  If it is not clearly looking for the lower bid then we won’t waste our employees’ time.” according to Ms. Mara.

Mr Hausner declined to say if Intellitec will bid again as no date for the third bid has been set.

Freelance Investigations called Ms. O’Connor with a list of questions regarding the bidding process itself and a time frame for the third bidding invitations to go out.  Calls to Ms. O’Connor were handled by Amy Basta, the Director of Public Information for Islip Town, who sent this E-Mail response from Ms. O’Connor.

Hi, Amy, I won’t be able to respond to the questions since we have not yet issued the advertisement for the third bid and any information out there could impact prospective bidders’ numbers and proposals. The writer is free, however, to submit a FOIL request to review the documentation the Town has on file. Thanks, Alicia.

At the September meeting Ms. O'Connor apologized to Ms. Mara and Ms. George stating:

We have cancelled the bid, we are now working on new specifications and putting in the required information, for a maintenance, servicing and monitoring contract.  I can assure you that it was not our intent to have a long arduous process, but the fact of the matter is, there were some mistakes, it went out and we caught the errors and now we are addressing it.

Admitting, "Some of the errors were discovered after the second bid" Ms. O'Connor added when questioned by Ms. George, that the Town would again be drawing up the specifications for the third bid "in house".