In late 2015, the City of Allentown started the process of soliciting proposals for a new municipal solid waste and recyclables collection contract. City employees, in conjunction with a consultant, determined to use a Request for Proposals (“RFP”) process, instead of the more traditional sealed bid process. This was done to allow the City the greatest flexibility in an effort to obtain the best value for the City and its taxpayers. Flexibility was deemed important because the fields of municipal waste collection and recycling are rapidly changing and the waste collection companies are particularly knowledgeable concerning the options available. The City also sought “value added” proposals which would be beneficial to the City, something that is not possible under the narrower sealed bid process.
One of the potential proposers objected to the process, contending that it was not proper under applicable law. Specifically, that company argued that the sealed bid process was required under the Third Class City Code. However, Allentown operates under a Home Rule Charter form of government, which exempts it from the Code. Allentown’s Home Rule Charter requires that it use competitive processes for City contracts, but neither requires a sealed bid process nor prohibits an RFP process. Likewise, the City’s Administrative Code specifies that certain contracts must be subject to bids, permits an RFP process for others, but it is silent on how services contracts are to be awarded.
After a diligent process to evaluate both technical proposals and cost proposals, the City determined that the lowest responsible proposer with regard to the options selected by the City was Waste Management of Pennsylvania, Inc., and awarded the contract to that company. City Council approved the award, even though one disappointed competitor, JP Mascaro & Sons, disputed the propriety of the RFP process.
Since it was unsuccessful in persuading the City that the RFP process was improper, Mascaro filed suit and sought to enjoin the ward of the contract to Waste Management. Mascaro argued that the RFP process followed by the City was “illegal,” and that the City had to start the process over, this time following the sealed bid structure.
Doug Smillie, Chair of FL&B’s Litigation practice, represented the City of Allentown, and argued that the RFP process was permitted under the City’s governing ordinance, and that a sealed bid was not required for the award of a services contract. Mascaro disputed this, arguing that the ordinance should be interpreted to require a sealed bid process, even though that requirement applies only to a limited number of specifically described types of contracts, not including services contracts. After a trial, at which evidence was presented to describe the thorough review and analysis under which all responses to the RFP were evaluated, the Court agreed with the City, holding that the ordinance was clear and unambiguous and that the omission of service contracts from the list of those required to be bid was presumed to be intentional. The City complied with the competitive processes required under its Home Rule Charter and the governing Administrative Code, and the request for an injunction was denied.
“A number of City employees worked diligently and conscientiously to obtain both the best services and the best value for the City and its taxpayers. The RFP process offered flexibility and was permitted under the applicable law. We are pleased that the Court agreed with our interpretation and that in the end Allentown will benefit from the extensive efforts of those individuals,” said Smillie.
