Honolulu Ethics Commission Investigates Fire Department Contract

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BY JIM DOOLEY –The city Ethics Commission is investigating allegations of wrongdoing in the 2010 award of a $175,000 consultant contract that recommended a merger of the Fire Department with the Emergency Services Department, Hawaii Reporter has learned.

The contract was awarded by the city to a firefighter-affiliated consulting firm after  last-minute changes in the selection process, according to records and interviews.


Ethics Commission executive director Charles Totto confirmed today that an investigation is underway.

“Yes, we are looking into it,” Totto said. “We’re in the early stages.”

Fire Chief Kenneth Silva and department spokesman Capt. Terry Seelig said the contract award was straightforward and appropriate but complicated by the fact that the top two bidders for the work were found equally qualified to perform it.

Totto confirmed the ethics probe after Paul K.W. Au, a member of a city procurement panel involved in the contract award, declined to discuss the matter in a brief telephone interview with Hawaii Reporter, citing the Ethics Commission investigation

“I can’t talk about that right now. It’s under investigation,” Au said.

The company that performed the merger study, Emergency Services Consulting International, is an Oregon firm owned by the International Association of Fire Chiefs (IAFC).

Chief Silva is a board member of the IAFC and in the past two years has benefitted from thousands of dollars of travel gifts to the city from the IAFC and a related group, the Western Fire Chiefs Associations, city records show.

Fire Chief Kenneth Silva

The gifts, which were approved by the City Council, financed travel and ground expenses incurred by Silva for four trips last year and this year to Mainland events sponsored by the two groups, according to city records. A fifth trip is planned for the end of this month.

Also benefitting from those cash gifts was Fire Department Assistant Chief Thomas Perkins, who served with Au on the procurement panel that reviewed the qualifications of companies that competed for the consultant contract.

Perkins has since retired from the Fire Department and did not respond to emailed questions for comment on this story.

“There is no connection between the funds to attend meetings and the selection of ESCI,” Silva said today through Seelig.

 The third member of the procurement panel was Patricia Dukes, Emergency Medical Services chief in the city Emergency Services Department.

Dukes declined comment.

“I have been informed to keep the matter confidential, therefore I cannot speak about the issue,” she said in an email message.

Hawaii Reporter obtained a copy of a June 21, 2010 email sent by Perkins to Dukes (and copied to Au, Fire Chief Silva and others) which referred to an unspecified “scoring dilemma” in the contractor selection process.

Perkins said he had asked Au to “consider reviewing and revising” his scores or to simply allow procurement  officials to make the decision.

Perkins said in the email that he made the request to Au after asking personnel in the Department of Budget and Fiscal Services how to proceed.

Procurement law requires the city to negotiate such a contract with the top-ranked bidder for the  consultant work.

If the top qualifiers are tied, procurement laws state that contracts should be awarded equally to the companies. But this contract was a one-time event, meaning that the work could not be shared.

Silva said that because the top two firms finished in a dead heat for the job, Perkins asked Au to revisit his review of the companies’ qualificaitons.

“Mr. Au chose to conduct a review of his notes and made an adjustment,” Silva said.

Asked if Silva or Perkins disclosed their connections to the consultant firm before the contract was awarded, Silva said “their membership and Chief Silva’s director role (at IAFC) were widely known prior to the selection process.”

And Silva “deliberately did not participate in the selection process” because of his connections to the IAFC and WAFC, Seelig said.

City records show that in the past two years, the IAFC and WAFC have given the city nearly $13,000 to pay for four Mainland trips taken by Silva or Perkins and a fifth trip planned by Silva at the end of this month.

One of the trips taken by both Silva and Perkins was to Denver in June 2011 to attend an IAFC event called “ConneXions” which allowed fire department executives to meet fire equipment vendors and to participate in “procurement focus groups,” according to city records.

Kenneth Silva

Included in the $13,000 worth of gifts accepted by the city in the past two years are funds to cover a planned $3,475 trip by Silva to Denver at the end of this month to attend an IAFC board meeting and a Fire-Rescue International Conference.

Mark Light, chief executive of the IAFC, said the group’s travel gifts were unrelated to the award of the consulting contract.

“We do not give any gifts to attend conferences or anything that would be an incentive for that,” Light said.

Light said he was unaware of the Ethics Commission investigation here.

The consultant’s report on a merger of the Fire with Emergency Services Departments has been criticized by Dr. James Ireland, director of the Emergency Services Department, and by Dr. Linda Rosen, head of the Emergency Medical Services branch of the state Health Department.

Dr. James Ireland

Ireland said “miscalculations and omissions” in the report made him doubt the consultant’s assertion that the merger could save taxpayers s much as $10 million per year.

He said he suspected that the move could in fact cost as much as $10 million more annually.

Rosen, whose state office funds Honolulu’s emergency services, also has misgivings about the numbers in the report.

“Some of the financial conclusions weren’t fully substantiated,” Rosen said today.

Rosen said the state doesn’t “have an official position” on the proposed merger.

“The biggest thing holding everything back is we really don’t have a model of how this would work. The consultant’s report is really more a concept with a lot of unanswered questions,” she said.

Light, who is also chief executive of the consultant firm that authored the report, denied that its contents were tilted to favor the Fire Department.

“The people that worked on the study with ESCI were some of the top administrators and EMS experts in the country and they look at each case based on the merits,” Light said.

Silva defended the ESCI report as “valid and credible.”

The report “presented a range of options and possibilities as a result of the information it obtained from the HFD and the Emergency Services Department,” the chief said.

The merger proposal has become a political football in this year’s Honolulu mayoral election.

One candidate, former city Managing Director Kirk Caldwell, has accused incumbent candidate Mayor Peter Carlisle of dragging his feet on the merger idea.

Carlisle has said he is taking a measured and careful approach to the possibility of a merger.