Bogus Bidding Busted in Ohio

© 2006 Door & Access Systems
Publish Date: Summer 2006
Author: Deborah Baron
Pages 54-56

Bogus Bidding Busted in Ohio
DOT Official Played Favorites for Garage Door Work
By Deborah Baron, DAS Special Correspondent

Some garage door dealers in northwest Ohio now know why they weren’t getting any work from the Ohio Department of Transportation (ODOT). A rigged bidding system, which favored a few select dealers, has led to the resignation of a key ODOT official.

John J. Gordon, district facilities manager, was suspended indefinitely with pay in March but resigned in April after he admitted that he had rigged bids for emergency garage door work in his district.

The Tipoff

The ODOT investigation was launched after a garage door dealer in Toledo tipped off the Ohio Attorney General’s office that someone named John was rigging bids for garage door repairs at a DOT district office. Door & Access Systems obtained a transcript of the March 2006 ODOT investigation interview.

“When door work becomes necessary, John contacts the door companies in question,” the allegation stated. “Subsequently, the companies get together, decide which company will be awarded the project, then submit quotes accordingly.”

ODOT investigators turned to Facilities Manager John Gordon when a systematic review of door repair projects revealed a pattern of questionable bids in his district. Their sleuthing revealed that “the first bid submitted was generally awarded the contract. Also, in some cases, the quotes from all the companies bidding were faxed into the district the same day and sometimes within hours of each other.”

Gordon’s Defense

Gordon submitted a written response to the allegation. “In my attempt to use the best contractors, give everyone a piece of the pie, and keep service areas close to the facilities, I have been using five contractors,” he explained.

“I have provided a list of the contractors to the county managers and to my staff … to call in the event of emergency repairs. This process expedites the response time.” Gordon claimed, “This was not done to benefit myself personally."

The Scheme

The state of Ohio bidding procedure requires at least two competitive quotes for work exceeding $1,000 and at least three bids for work over $2,500. Also, as long as contracts awarded to any one vendor do not exceed $50,000 in a year, state procedure does not require public bid advertisements for small contracts.

But Gordon, apparently feeling pressured to get his district’s repairs done quickly amid government protocols that tend to slow the work process, devised his own bidding procedure.

Approximately two years ago, Gordon said, he contacted several door vendors. If they agreed, he would assign each of them a (district) garage for which they would perform preventive maintenance and emergency repairs. If the repair or replacement of a door was likely to exceed $1,000, Gordon would contact the “preselected” vendor in that area and request a quote.

Then Gordon would direct the selected company to call one or two competitors and have them submit higher bids. “This process made it ‘appear’ ODOT had followed proper protocol by obtaining competitive bids,” according to investigation findings.

Blowing the Whistle

A story in the Toledo Blade on March 23, 2006, first reported Gordon’s suspension for his rigged bidding scheme. In the Blade’s report, one of the original whistleblowers explained that he saw a fax arrive from another door dealer requesting the (whistleblower’s) company to submit a repair bid “several hundred dollars” more than they had just submitted.

The employee prepared the bid himself because his boss was not available. However, he had a secretary sign it and send it to ODOT because he “didn’t want his name on it.” He has since gone to work for another door company, but he first told another dealer about the scheme.

The owner of that door company told the Blade how he learned about the suspicious bid process. That set off his report to the state attorney general.

“Not Right”

John Gordon admitted that what he had done was “not right,” but he is quoted in the interview transcript as saying, “I have done things to try and expedite work here. I don't want to use it as an excuse, but … I am very short-staffed. I have four trade workers … to try and maintain the entire district.”

ODOT reported that, although Gordon “had been provided training relating to the competitive bidding process, … he developed and implemented a process contrary to the ‘intent’ of competitive bidding.”

The Aftermath

Andrew Gall, a spokesman at ODOT headquarters in Columbus, Ohio, said that investigators had scrutinized all garage door repair contracts awarded in District 2 for the period in question. After Gordon admitted to accepting rigged bids, the ODOT investigation determined the original allegation to be “founded.” At that point, Gordon was suspended indefinitely, but a story in the Cleveland Plain Dealer reported on April 8 that Gordon had resigned.

In the Plain Dealer story, Gall said, “The investigation turned up no evidence that Gordon accepted bribes or otherwise profited from the scheme.” Gall also told the Plain Dealer that “ODOT is still reviewing the $80,000 in purchases it made from door vendors in northwest Ohio in 2005 and 2006, but that ‘there did not seem to be any gross overpayments.’”

The Tip of the Iceberg?

Bob Bollin is the owner of Toledo Automatic Door, a firm that was not involved in the scheme. He learned of Gordon’s original suspension in the Blade story and has been following its progress “through the grapevine.”

Bollin doubts that it is an isolated incident. “I would guess that this goes on regularly to try to reduce the ‘red tape factor’ when procuring and performing government work. It upsets me to think that a few ‘selected’ door dealers are doing state work at what are probably highly profitable inflated prices at the taxpayers’ expense.”

John Gordon admitted to investigators that his bidding procedure resulted in ODOT paying more. He said his contractors could set their own prices because they were sure their competitors would not undercut them. Agreed Bollin, “Why would you submit a low bid when you have already been informed you will get the job, with price being no object?”

Bidding on Government Jobs: What You Should Know

The American Subcontractors’ Association (ASA) believes that the construction practices of the federal government should be an example for the entire construction industry. ASA works with Congress, trade, and business organizations to promote fair procurement policy.

Their policy states, “The bid amount of one competitor should not be divulged to another before the award of the subcontract or order, nor should it be used by the contractor to secure a lower proposal from another bidder on that project.”
Although Gordon’s scheme was a variation of this practice, it still prevented some qualified companies from getting government work.

What You Can Do

Andrew Gall told Door & Access Systems that if a vendor suspects suspicious bidding, they should report it to their DOT’s Chief Legal Counsel’s office or the state Inspector General’s office for review and investigation.

What should a good door dealer do?

Bob Bollin put it best: “I sleep well at night because I know that I do business right. Ethical business practices are the only way. You do not get anything for free. Pay your dues, work hard, do your job, be honest, and it will reward you in the long run.”

Bogus bidders beware.

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