E-ZPass bidding 'debacle'
Published in the Asbury Park Press 6/30/04
The way in which the contract for New Jersey's E-ZPass system was
designed and awarded by Whitman administration officials was the result
of an "administrative and financial
debacle of immense proportions,"
according to a blistering State Commission of Investigation report.
The report, released yesterday, contends some former senior state
transportation officials manipulated the bidding process to favor one
company and other officials
ignored repeated warnings that the funding
system they preferred would not work.
"Ultimately, this procurement was approached in such a way that the
combined absence of oversight and transparency produced a contract
award recommendation under circumstances that strongly suggest
malfeasance," the report states.
The 18-month SCI study examined how MFS Network Technologies, a
California company, was awarded the E-ZPass automated toll collection
contract in 1998. The E-ZPass program was to have paid for itself
through fines and leases, but ran up a deficit of more than $400
million by 2003.
The 149-page report alleges that state
rejected any attempts at financial oversight and conducted much of the
discussions and negotiations for the contract out of public view.
Targeted for particular criticism in the SCI report are:
|Former state Department of Transportation
Frank J. Wilson, who, the SCI said, was engaged in employment
discussions with companies linked to the E-ZPass procurement process
while the bids were being created and reviewed and who steered the
process away from Lockheed-Martin and toward MFS.
David Mortimer, Wilson's chief of staff, who the SCI
said refused to allow any consideration of financing plans other than
one under which toll cheats and leasing excess fiber-optic network
space would generate all needed revenue and who engineered a drawn-out
grading process through which the eventual winning bidder was chosen.
California-based consultant Kingston Cole, who the
SCI said had a "pre-existing professional relationship with Wilson" and
was given no-bid state contracts by Wilson in New Jersey.
Berkeley Township attorney Edward
Gross, who was then
the acting executive director of the New Jersey Turnpike Authority
who, the SCI said, intimidated
turnpike employees who appeared to get
in the way of the project. The report said Gross also told the
Assembly Transportation Committee in 2002 that the Turnpike Authority's
finance department had approved the numbers supporting the self-funding
scheme, while the authority's chief financial officer told the
commission that she had not.