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In October, D.C. chief contracting officer Derrick White emailed Dash Kiridena, the CEO of a local IT company, CODICE, with some bad news.
Kiridena’s bid for a $13 million dollar contract to modernize the District’s unemployment insurance tax system was rejected. White wrote in the Oct. 9 email that although Kiridena’s proposal was impressive, “the contract has been awarded to the highest ranked offeror, Sagitec Solutions, LLC.”
But an internal government document leaked to LL says otherwise.
The 30-page document, dated April 30, 2019, lists the six companies that bid on the contract to modernize D.C.’s unemployment insurance tax system and spells out their proposals. The document then ranks the bidders based on technical criteria, pricing, and any extra points from D.C.’s Certified Business Enterprise program, which is designed to tip the scales in favor of local, minority-owned businesses.
Kiridena’s company, a joint venture with the Illinois-based On Point Technology, LLC, is ranked number one overall due to a boost from its CBE preference points, according to the leaked document. But Sagitec ranked higher in terms of its technical evaluation.
Now, Kiridena is crying foul. On Oct. 24 he filed a protest with the Contract Appeals Board, claiming that the Office of Contracting and Procurement violated contracting law and has ignored his requests for a required debrief after the agency notified him that Sagitec won the contract.
The leaked document and the protest, which has stopped Sagitec’s preliminary work on the contract, highlights some criticism of the CBE program, where proposals from local companies can be given greater weight than those from potentially more qualified firms.
The protest also pits two companies with ties to the District government against each other. On one side you have Thomas Luparello, the CEO of On Point Technology, Kiridena’s partner in the joint venture. Luparello was the executive director of D.C.’s Department of Employment Services, the agency offering the contract, in former Mayor Vince Gray’s administration.
Thorn Pozen, a lobbyist who has appeared in this column for his affiliation with Mayor Muriel Bowser’s controversial FreshPAC, is one of the lawyers representing CODICE in the protest. Pozen also lobbied the Council on behalf of Emmanuel Bailey, whose small company won a big piece of the District’s $215 million lottery and sports betting contract despite apparently having no employees, the Washington Post reported.
On the other side you have Darryl Wiggins, who owns the local company that is subcontracting with Sagitec on the deal. Wiggins and his company, DigiDoc (also known as Document Managers), stood to benefit from an alleged contract-steering scandal that got the chief operating officer for the Department of Health Care Finance fired in 2012. Wiggins was also a political advisor to former Mayor Adrian Fenty and chaired Ward 4 Council campaigns for Bowser and her successor, current Ward 4 Councilmember Brandon Todd. He is currently the chairperson for Todd’s 2020 re-election campaign.
Wiggins says he’s worked with Sagitec since 2014 on unemployment tax systems in multiple states. According to the leaked document, Sagitec has experience establishing unemployment tax systems in Maryland, West Virginia, and South Carolina. The company also won the contract to provide the District’s new Paid Family Leave tax system earlier this year.
Because the contract is tied up in pending litigation, neither District government officials, nor representatives for CODICE would speak with LL on the record. David Minkkinen, a senior partner at Sagitec, also declined to comment. A hearing on the protest has not been scheduled.
Now rewind to May 28, 2019, when OCP notified Kiridena that White would be replacing the original contract officer, Monica Hariri. (Hariri is listed as the contracting officer on the leaked April 30 document, and according to LL’s sources, no longer works for OCP. She declined to comment.)
In his protest Kiridena says Hariri’s departure is concerning.
“In [Kiridena’s] prior dealings with CO White on separate matters, CO White had expressed to [Kiridena], on more than one occasion, that CBEs were not equipped to handle the District’s technology needs,” the protest states. “These comments indicated to [Kiridena] that CO White was biased against [him] and likely to dismiss [his] proposal simply on the basis of [his] status as a CBE.”
For nearly three months, Kiridena heard nothing from White, according to the protest. Then on Monday, Aug. 19, he received an email from OCP requesting a webinar demonstration of his proposed tax system. The “system demonstration” is part of the normal procurement process in which Kiridena and the other bidders made their pitches to Hariri and a panel of technical experts. The second demonstration would allow White to evaluate the proposals for himself, according to the email.
However, attached to the Aug. 19 email was a more formal letter dated Aug. 16, the previous Friday. The Friday letter offered six time slots over three days from Aug. 21 through 23. But by the time Kiridena received the email only two slots were left, according to the Monday email.
Following the demonstration, White told Kiridena that his intent was to negotiate with the highest ranked bidder, according to a recording of the meeting that LL listened to.
“I do not know who that will be, and I will not know until I finish [the] system demonstrations,” White said. “But I do want to thank you guys for doing a great presentation for us.”
In the protest, Kiridena says he gave the second demonstration to White only, and none of the technical panel was present.
“Although [Kiridena] is not aware of [White] being a technical expert himself, [White] did not, in any case, identify, to [Kiridena] any disqualifying deficiencies in [his] product or capabilities,” the protest states, adding that White did not ask any follow-up questions.
White and Minkkinen, of Sagitec, signed what’s known as a “letter contract” on Oct. 8 for an amount not to exceed $1 million. The contract allowed Sagitec to begin working immediately because the agreement does not exceed the $1 million threshold requiring the Council’s approval.
OCP notified Kiridena on Oct. 9 that Sagitec won the contract, and the next day he requested a debrief, which OCP policy says he is entitled to within five business days.
White briefly responded via email later that day: “Acknowledged.”
By Oct. 15, White still hadn’t booked a debrief, and Kiridena emailed him again. This time, he specifically asked for numeric rankings of all the bidders, a summary of his rationale for the award to Sagitec, and his own company’s weaknesses.
Again, White responded later that day: “I acknowledge your email.”
On Oct. 17, with still no debrief on the books, and the five-day deadline approaching, Kiridena emailed White again. White quickly replied: “I am in the process of scheduling all debriefs. I will send you an [sic] calendar invite when I’m ready to conduct a debrief for you.”
Four weeks later, Kiridena is still waiting.