Government South Orange Towns

South Orange Moves on Pay to Play Amendment

(Discussion of amendment of the pay to play ordinance starts on the video of the September 8 2014 Board of Trustees meeting at 1:21:24.)

The South Orange Board of Trustees unanimously endorsed an amended pay to play ordinance on Monday night, September 8.

“Pay to play” is the common phrase used to describe the practice of political contributions being given in exchange for government contracts. Many towns, including South Orange, adopted their own pay to play ordinances restricting such behavior after the state enacted its own pay to play laws in 2006.

Township Administrator Barry Lewis explained why the further amendment of the South Orange ordinance, which was first amended in 2011, was needed.

Lewis noted that South Orange’s ordinance started from a place that was much more stringent than the state legislation that inspired it.

The state legislation, said Lewis, set up thresholds for contributions and two processes: One called “fair and open” and one called “non fair and open.” Any contract in excess of $17,500 requires the fair and open process, similar to a public bidding scenario. “Non fair and open” is used for contracts below $17,500 in which the town hires “the professional it’s most comfortable with.” Such a contractor would then be incapable of making a reportable contribution (anything over $300 ) to a local elected official or campaigns or committees supporting local elected officials.

South Orange, Lewis explained, is more stringent than the state legislation, banning any contributions from a contractor, whether the contract is awarded through the fair and open process or not. The South Orange law initially also required all contracts, whether above or below $17,500, to be bid as fair and open. However, South Orange amended the ordinance in 2011 to apply the fair and open process to contracts of $17,500 and over only.

Despite that amendment, said Lewis, “The strict application created problems operationally and the village’s ability to get the best value.” He said that the need for the additional amendment was apparent after talking to department heads.

Lewis said that the current amended ordinance “strikes the appropriate compromise” and “addresses practical difficulties” without sacrificing the heart of the law.

He noted that this amended ordinance has been “tweaked” based on public comment and feedback from board members.

“It does a couple of things,” said Lewis. The ordinance retains the restriction that no reportable contributions can be given — regardless of amount. It also provides and requires that any professional service in excess of $17,500 is required to be procured through the fair and open process, but with two notable exceptions:

1. Appointed professional services. For professionals who serve the village on an annual basis, including the town planner and counsel, Lewis said it was “not practical to RFP and switch those positions every 12 months.” The ordinance will require that such positions go to RFP every three years at a minimum or when needed per the discretion of the board.

2. Additional professional services. Lewis said this amendment both “tightened up” and “expanded” the 2011 amendment to the ordinance. “This is a situation we have found ourselves in where we go out, we do an RFP, we have a fair and open process, we award a contract to a professional to do what I’ll call the preliminary or background work on a particular project … then because at that point you don’t know what the condition is or what the scope of project would be, it’s not possible to get a quote  …  and/or because a project grows in scope.” Lewis said that going out to RFP and subsequently hiring a different professional in such a scenario — where the new contractor would have to redo a significant portion of the work of the original firm — was wasteful and impractical. However, to guard against a contractor deliberately extending a project, “we’ve included a requirement that additional services be provided under the same rates of the initial contract.” Lewis said that, as with the appointed professional exception, the use of this exemption was subject to the board’s discretion.

The pertinent language of the ordinance related to this second exception reads as follows:

Such services are necessary and an initial part of the work or project for which the initial contract was awarded, or constitute an additional phase of the project which was the subject of the initial contract and  the performance of which will utilize and require the work product from the initial contract and which if awarded to another entity would require the new entity to perform all or a substantial portion of the work already performed under the initial contract.

The additional services were either unanticipated at the time the initial contract was awarded or because of the passage of time, insufficient funding, or a need to phase the work for which services are required, the services could not be contracted for earlier.

The additional services will be provided under the same rates, terms and conditions as the initial contract to the greatest extent possible.

After Trustee Deborah Davis Ford questioned whether the ordinance was available online (it is), there were no questions from the other Trustees. The ordinance was passed on first reading unanimously. A second reading of the ordinance will follow.

Read the ordinance here.

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