Newark school board cries foul over no-bid deal for politically connected firm

By Dan Ivers | NJ Advance Media for NJ.com
Email the author | Follow on Twitter
on January 20, 2016

Newark Superintendent of Schools Christopher Cerf, shown here in a file photo, is defending the district's decision to award a no-bid prescription benefits contract to a company with ties to well-known New Jersey political figures.

 

NEWARK – The city's School Advisory Board expressed their reservations over Superintendent Chris Cerf's recent decision to award a contract to a politically connected prescription benefits provider.

At the board's business meeting at Newark Public Schools headquarters Tuesday, members said they were dismayed that officials had bypassed both the board and the open bidding process to switch all district employees to the new provider, Benecard, as of Feb. 1.

The move had previously drawn the ire of the Newark Teachers Union over its ties to prominent Trenton power players. Benecard is owned by former U.S. Senate and gubernatorial candidate Doug Forrester, and was recommended by Conner Strong & Buckelew, an insurance brokerage firm run by South Jersey political power broker George Norcross that also does business with Benecard.

While the board said they understood exploring all potential cost savings measures as the state-controlled district continues to grapple with significant revenue shortages, the manner in which the switch was made appeared to give them pause.

"I suggest we go out to bid and seek the lowest bidder. The one that's going to give us the lowest rate, so it can look like in fact we are being transparent and we have nothing to hide," said Chairwoman Ariagna Perello.

"We have a new superintendent who is saying to everyone 'I'm going to be transparent.' So why not be transparent in this case?"

District officials defended their decision, saying Benecard's plan would offer an estimated $1.5 million in savings over current providers while improving service for subscribers. They also stressed that Conner Strong recommended the switch only after examining plans from a number of providers – a process that has been employed with the past while contracting services such as insurers and legal representation.

Conner Strong has been the district's broker since 2007, when it took over a smaller benefits consulting firm that had previously been contracted for the role, according to Cerf.

"The Conner Strong process was a deliberative one," said Business Administrator Valerie Wilson. "There were competitive proposals sought from several vendors."

Cerf also pointed out that the move to act unilaterally was made only after negotiations with the Supplemental Fringe Benefits Fund – an unusual joint trust between the district and union - were thwarted by a number of NTU-appointed trustees.

The adoption of Benecard as the district's sole prescription provider essentially renders the SFBF – which has managed dental, vision and prescription benefits for city teachers since 1972 – null and void.

"We have been in discussions with them, with this board, I believe going back to last spring," Cerf said. "We hit brick wall after brick wall after brick wall. Finally we decided enough is enough."

Top Newark schools official announces exit from district

Board member Antoinette Baskerville-Richardson said she feared for any legal ramifications the district might face if it was found to have violated its contract with its roughly 4,000 teachers. The union has already filed a complaint alleging as much with the state's Public Employment Relations Commission, and has provided notice that it plans to file a formal lawsuit.

"In the larger picture this is a question of the (district) taking their toys and going home...because the district didn't get its way," Baskerville-Richardson said. "I think that that's basically unethical. Some changes may have to be made, but that is not a responsible way to make them."

Cerf, however, doubled down on earlier comments that any deviation from the norm was done solely for the sake of the city's students.

"We clearly have a different view in terms of what's ethical or moral, and I'm going to stand by mine," he said.

Vice Chairman Marques-Aquil Lewis suggested the board produce a resolution formally opposing the no-bid deal for a possible vote at next week's regular meeting.

Other members, including Perello, voiced support for such a measure, saying the district's action had sent a disheartening message as the board prepares to shed its advisory status and assume legitimate power over city schools in the coming years.

"It makes us feel that the board really doesn't matter and obtaining financial control doesn't matter either," she said. "Because at the end of the day the district will do whatever they feel that is best for them."

Do you like this post?

Be the first to comment