Northern Burlington officials said they are appealing the state’s decision that the school board violated the Public School Contracts Law.
By: William Wichert
The Northern Burlington County Regional School District is battling a $73,354 fine levied by the state Department of Education in regard to the district’s contract for the security system at the new middle school.
District officials said they are appealing the state’s Nov. 1 decision that the school board violated the Public School Contracts Law by awarding the security contract earlier this year to a firm which had submitted a bid without giving the other nine bidders a chance to negotiate a contract as well.
"We didn’t feel that we had to sit down and negotiate with all 10 bidders," said Richard Kaz, the district’s business administrator, who said the district filed the appeal this week. "It just doesn’t seem feasible to sit down and negotiate with 10 people. There was nothing malicious going on here."
The appeal was filed this week with DOE Commissioner William L. Librera, who will evaluate the district’s position, but there is no deadline for the commissioner’s decision, said Jon Zlock, a DOE spokesman.
According to the DOE’s October report on the contract violation, the school board advertised the security system contract for the new middle school on Oct. 26, 2003, and subsequently received three bids.
The board rejected those bids and re-bid the project on Dec. 14, 2003, according to the report. The district received 10 new bids, but rejected them again "as unreasonable to price," the report states.
After this second set of bids were rejected, the board negotiated and awarded a $178,911 contract to Integrated Systems and Service Inc. of Cliffwood without any more bidding, according to the report.
As a result, state officials stated that the district violated the following clause of the contracts law: "If on the second occasion the bids received are rejected as unreasonable to price, the board of education shall notify each responsible bidder submitting bids on the second occasion of its intention to negotiate, and afford each bidder a reasonable opportunity to negotiate."
Mr. Kaz said the school district has interpreted this clause differently in the past and negotiated contracts in similar ways, Mr. Kaz said.
"That doesn’t mean we’re right or wrong, but they’re (state officials) telling us we interpreted it incorrectly," he said. "We’ve done (this practice) on several occasions where we’ve rejected bids twice and sat down to negotiate with several bidders."
One instance of these negotiations took place a couple of years ago, when the district was soliciting bids for the demolition of a sewer plant on its property, Mr. Kaz said. The district rejected the bids twice and then negotiated a contract with one of the firms, he said. At that time, only a couple of firms submitted bids, said Mr. Kaz.
By negotiating the $178,911 contract with Integrated Systems and Service Inc., Mr. Kaz said the district was able to save about $150,000, because several higher bids were over $300,000. He said other firms submitted bids lower than ISS did, but those did not meet the project’s requirements.
"They (ISS) submitted what we considered a competitive and competent bid," he said. "The lowest bid doesn’t mean it was a competent bid. Some of the contracts were underestimating the scope of the work."
The security system contract involved the installation of video cameras, fire alarms, smoke detectors and electronic card readers on the outside of the middle school, which opened this past fall, Mr. Kaz said. He said ISS is in the process of fulfilling the final requirements of its contract.
If the district’s appeal is rejected, however, it will establish a Corrective Action Plan (CAP) that the DOE requested in its October report, Mr. Kaz said. The CAP will mandate that the district notify all bidders of its intention to negotiate a contract, he said.
But the school board still takes issue with the $73,354 fine, Mr. Kaz said. The specific fine was calculated by multiplying the amount of the contract, $178,911, by the percentage of state aid during the 2004 fiscal year, which was 41 percent, according to the DOE report.
"We think that the fine was arbitrary," said Mr. Kaz. "The project was paid with federal dollars and they’re using a state funding formula to come up with the fine."

