Contracts with Department Heads

By Matt Grocott

Problems with contracts, respective to department heads, needs addressing. With a new City Manager on board, and a new Council after the election, I will take the lead to finally address these shortfalls as has not been done over the past four years.

For example, the Municipal Code was changed to prevent department heads who are contractors from bidding on work, if they participated in preparing the bid documents. Almost immediately, the City found a way around the provision by simply awarding work without bids, without a contract.

Left unchanged in the Municipal Code was section 3.12.260, Paragraph A. This section of the code seems to have been written to purposefully allow "sweet heart deals" with certain firms. It is because of this clause that Mokhatari Engineering, for example, has a contract with San Carlos to provide City Engineer/Public Works Director services, yet has never been expected to submit a proposal in the context of competing proposals.

In its 2004 report, the Civil Grand Jury cited the "20 Factor Test" the IRS uses to determine whether or not an individual is an employee or a contractor. One factor is that the contract have a specified term for specified work. Again using Mokhtari Engineering as an example, the contract we have with ME was last reviewed and signed on September 16, 2002. Every City employee has an annual review; it is bad policy to allow contractors to carry on indefinitely without the same measure of scrutiny as employees and in possible violation of the IRS.

These problems with contracting need addressing. With a new City Manager on board, and a new Council after the election, I will take the lead to finally address these shortfalls as has not been done over the past four years.