House members question $3.9M Marpi landfill contract

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SOME members of the House of Representatives have expressed concern about the three-year, $3.9 million deal between the Department of Public Works and Micronesian Environment Services LLC or MES to operate the Marpi landfill.

The contract was awarded on Monday last week, DPW Secretary James Ada informed lawmakers during the budget hearing conducted by the House Committee on Ways and Means.

House Floor Leader John Paul Sablan said he is reviewing the documents including the contract itself, memoranda and communications.

Rep. Joseph Leepan T. Guerrero, for his part, asked questions about the bidding process.

MES and the previous operator of the landfill, Tang’s Corp., submitted proposals to operate the landfill.

James Ada

On Feb. 19, Tang’s Corp. submitted a bid for equipment rental only, amounting to $109,824 for three months while MES submitted a proposal to operate and maintain the landfill for $119,989 per month. On Feb. 27, MES submitted its “best and final fee proposal”: $109,683 per month.

On Feb. 28, Procurement and Supply acting Director Frank Aguon cancelled the invitation for bids on the equipment rental. On March 4, MES submitted another “best and final fee proposal” further reducing the cost to $106,495 per month.

On April 22, Ada submitted to  Procurement and Supply a “justification for emergency procurement of equipment rental and security services” and sought approval to award the contract to MES.

Ada told Aguon that the “land operations contract under Tang’s Corp. has been completed and therefore we need an interim operator pending the results of the request for proposal [for operation]. This interim contract is necessary under emergency procurement, as the existence of public health and safety may be threatened.”

The cost that Ada indicated in the letter was $53,140 per month, but in the contract that Finance Secretary David DLG Atalig certified on May 29,  the amount was $318,842.

Sablan and Guerrero said they are concerned about the cancelation of the invitation for bids for equipment rental that was followed by a “best and final fee proposal” from MES.

Sablan said it is highly suspicious that one of the bidders would reduce its proposed fee in the middle of the procurement process and after the cancelation of the invitation for bids for equipment rental.

Guerrero said it appears to him that “this was a done deal.”

For his part, DPW Solid Waste Manager Blas Mafnas told the lawmakers that the cancelation of the invitation for bids was “beyond our control.”

He added that it was an evaluation committee that submitted its findings, along with documents, in selecting the new contractor.

But “there’s always an opportunity to appeal the decision,” he said.

DPW officials also informed the lawmakers that Tang Corp. has received $78,576 as partial payment for its contract that expired in October last year. The officials said DPW still owes Tang’s Corp. $151,914.




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