By Steve Waring
Special to The Milwaukee Times
(Editor’s note: This is the first installment on a continuing series The Milwaukee Times has undertaken to educate business owners and our readers on who’s receiving their tax dollars and share their location and whether they employ individuals who live in the City of Milwaukee. This series will also report on procurement by the City of Milwaukee, Milwaukee County and the State of Wisconsin.)
The Milwaukee Public School (MPS) system held its first monthly information session for vendors who are interested in doing business with MPS and unfamiliar with the process. The session was held September 24, 2015 at the MPS Central Services building, 5225 W. Vliet Street.
In 2008 McKinsey & Co., global consulting firm released a report which in part urged MPS to make a number of changes, including reform of the vendor procurement system. “The system frequently uses outdated practices such as keeping information on slips of paper and not in a database,” the report stated and concluded that MPS could save between $10-15 million as reported at the time in the Milwaukee Journal Sentinel.
MPS has gradually been changing its purchasing procedures, according to MPS Procurement and Risk Management Director Kristin D. DeCato. Since that report, vendors have been added to a database and the system computerized, she said. These changes are meant to make the system more transparent and to maximize value to taxpayers, she said. Under the new system jobs are assigned and categorized into three categories depending on the estimated cost.
Jobs costing less than $5,000 do not require administrative approval. Vendors are discouraged from contacting schools directly, but MPS officials acknowledged that it does happen and that they are not particularly threatened by a minority-owned business doing occasional work of less than $5,000 for one school near where its offices are located. What the district wants to avoid is one ‘shell company’ business dominating the market by operating under a variety of subsidiary companies.
The middle-tier vendor supply process covers goods and services in the range of $5,000.01 through $49,999.99. Vendors seeking business worth this amount of money must submit a bid. An MPS administrator will select three bidders and negotiate with the three chosen to determine who will receive the bid. More than a dozen vendors attending the meeting on September 24 had the most questions about this part of the process. For instance one vendor asked who oversaw the work of the administrator who chose the vendor; and another asked what the criteria were for submitting a successful bid. The vendors did not seem entirely satisfied with the answers offered.
“We don’t have to use the lowest quote,” DeCato said. “We have discretion after we get those three quotes… We’re only held to the lowest price on sealed bids.” Work estimated to cost more than $50,000 requires a very extensive sealed bid process. This type of work is typically for major projects and a very thorough and transparent sealed bidding process must be followed and closely monitored. Information on bidding for those types of jobs is available from MPS.
DeCato said that a good working relationship with MPS went a long way to ensuring that work is steered toward the motivated vendor. “The whole driving force behind our policy is inclusion and educating our kids,” she said. “Of course money is a driving force, but the metrics vary depending on the job requested. Obviously plumping repair and mindfulness training” would have different standards by which to judge quality of work performed, she added.
