How a City Contract Bid Opening was Faked
Nothing illegal, but two lost their jobs in a comedy of errors,
Sunday, July 25, 2004
By Frederic Pierce, Staff writer
Channel 10 News' camera was rolling May 3 when Syracuse city officials
ceremoniously opened the sealed bids submitted by developers interested in
bringing the long-vacant Mizpah Towers building back to life.
A veteran city purchasing employee went through the two proposals page
by page, noting required items.
When he was done, former city Economic Development Director Bart
Feinberg announced that a decision would be made within 90 days.
The public procedure was done by the book, except for one thing.
It was a sham.
The proposals, both of which had arrived unsealed, had been packaged
and treated as if they were sealed bids, city officials now say.
The charade was held to satisfy media interests based on an inaccurate
newspaper advertisement by the city. "It was staged," City Operations
Director Charles Everett said.
No criminal wrongdoing has been alleged in the city's mishandling of
the Mizpah proposals to develop the former church on Columbus Circle.
It did, however, cost two top City Hall officials their jobs, sent both
interested developers back into limbo and guaranteed there will be no
redevelopment of the historic structure unless it survives another winter.
The incident created a blizzard of internal finger-pointing and
launched an independent city audit that has bogged down over disagreement
about what the city auditor is authorized to do.
"There's enough blame to go around," City Auditor Phil LaTessa said.
"I, as city auditor, am never going to know exactly what happened.
Nobody's going to know because it's become a he-said, she- said kind of
The one thing everyone seems to agree on is that the bid opening shown
on Time-Warner's cable news channel and broadcast over radio station WSYR
was a fake.
City administrators said Feinberg and former Budget Director Ann Rooney
are responsible for the staged opening, and said they later misled other
city officials about the process and the nature of the responses.
Both Feinberg and Rooney, however, deny they were behind the false bid
opening. They acknowledge that mistakes were made in the process, but said
many of the city's allegations against them are false and said they did
nothing to intentionally mislead anyone.
"I'm the one who told them that the bids had been repackaged," Rooney
said. "If they're so convinced that I was trying to hide this stuff, why
would I tell them?"
Rooney and Feinberg said the staged event sprang from pressure by
members of the administration - chiefly City Director of Intergovernmental
Relations Christine Fix - to hold a media event.
The two Mizpah proposals were responses to letters sent directly to the
developers; the responses were not to a newspaper ad that erroneously
asked for sealed bids. A bid opening wasn't required and none was planned.
The incorrect ad, however, drew the attention of some members of the
local news media, who asked to sit in on the opening. As far as city
communications personnel knew, they were arranging coverage of a
legitimate news event, Fix said.
"If they felt pressure, why didn't they say then and there that the ad
was wrong and there were no sealed bids to open," Fix said of Feinberg and
Rooney. "We didn't know anything was wrong."
Feinberg, ina written statement given to LaTessa, said he explained the
situation to both Fix and Everett, but the opening was held anyway.
What Feinberg failed to tell them, Everett said, was that the proposals
had already been flipped open and looked at as they came in, something
that's usually not a problem with responses to city requests for
But since the city had advertised the Mizpah project as a sealed bid,
the law required it to follow that process, Everett said. That meant the
process should have automatically been scrapped and begun again.
Rooney said she was contacted by Fix about an hour before the scheduled
opening. Rooney said she called the city worker who normally opens bids
and told him to go with Feinberg and "do what he usually does."
"That's all I told him," Rooney said. "In my mind, I was thinking
Mizpah-RFP (request for proposals), and the talk of sealed bids didn't
register. I was thinking of the deadline for getting proposals in."
Norman Mingolelli,the purchasing employee sent to handle the situation,
told administration officials he felt he was doing what Rooney had
directed him to do when he repackaged the opened proposals, put them in a
box and then opened them for the news media, Everett said.
Feinberg admitted to LaTessa that he went along with the charade but
did so out of frustration with changing rules and red tape that he felt
were holding back what he viewed as a viable development proposal for
New Salt City Ventures - a group spearheaded by Syracuse businessman
Alan Isserlis - wanted to pursue a $19 million plan to turn Mizpah into a
hotel. A local arm of the Wesleyan Church, meanwhile, proposed a $10
million plan to use it as both a church and a social service center.
"At the time, I should have just said no," Feinberg told LaTessa of the
bid opening. "But the whole process was a complete comedy of errors, and I
just wanted to be able to move on the review of the RFPs since we were not
going to be awarding a bid."
LaTessa plans to complete his audit sometime next week.
Mingolelli wasnot punished for his role, mainly because city officials
believed he was acting on Rooney's orders, Everett said. Everett
acknowledged that no one knows exactly what Rooney told Mingolelli, but
said she and Feinberg were responsible for other problems that occurred
well before the bid opening.
Things started to go wrong in January, when administration officials
said that Mayor Matt Driscoll made it clear in a meeting that he wanted
potentially important, city-owned buildings like Mizpah, the Sibley's
garage and the Dey Brothers building to follow the RFP process.
But Feinberg, who had been working to sell the property directly to New
Salt City for more than a year, said Driscoll didn't make that clear to
him until late March or early April. The RFP was issued April 6.
The RFP process is supposed to be handled by the city purchasing
division, which Rooney oversees, Everett said. The Mizpah request was done
primarily by Feinberg, with help from Rooney's staff, she said.
City officials said Mingolelli questioned Rooney about that decision,
as well as her approval of Feinberg's request to shorten the response time
to the RFP from six weeks to three weeks. They said Mingolelli also
refused to approve the ad that eventually caused the problem, forcing
Rooney to sign it herself.
Rooney, however, said she routinely signs all requests for ads -
sometimes without having time to read them carefully - and that this was
Feinberg said the draft ad he gave to a purchase division clerk was
As soon as the incorrect ads ran, the process should have been declared
invalid, because potential developers could have been dissuaded by the
sealed bid process, Everett said.
© 2004 The Post-Standard.