Q&A
MOCS explanation of vendor responsibility determinations and related party transaction policies
1:30:23
·
139 sec
Charles Diamond from the Mayor's Office of Contract Services (MOCS) explains vendor responsibility determinations and policies regarding related party transactions.
- Vendor responsibility is determined on a case-by-case basis for each agency, as required by law
- The city cannot blacklist vendors but considers past performance and integrity issues in each determination
- MOCS is developing a new related party transactions policy and procedure, expected to be implemented in 2025
- The policy aims to balance rigorous oversight with the need to avoid hindering legitimate nonprofit operations
Commissioner Park adds:
- DSS has taken aggressive action against vendors with related party transactions, including ending business relationships or prohibiting the use of related sub-entities
Charles Diamond
1:30:23
Absolutely.
1:30:23
And tier 1.
1:30:25
So in particular, regarding touching on your kind of last issue of DHS perhaps not doing business with an entity or other agencies doing I just I have no personal knowledge of the contractor you described doing business with anybody else I can follow-up.
1:30:37
But it is, I think, important and as we've discussed before to note that, vendor responsibility and that determination that a vendor is responsible for receipt of public funds is by law on a case by case basis.
1:30:49
The city does not have the tools at it at its disposal to blacklist or otherwise a vendor.
1:30:54
We do not have those tools.
1:30:56
The state has some tools to do that that we can take notice of.
1:30:59
The federal government has aspects they can do that we can take notice of.
1:31:02
But when it comes to, as you say, a vendor who may have had an integrity problem where, or even, performance that was not adequate or anything else.
1:31:11
It's gonna be a case by case determination, for each agency when it comes before them, and that is determined by law that the city will take it on a case by case basis.
1:31:19
So you mentioned, in particular, the related party transactions.
1:31:22
As I referenced earlier, this is a significant, significant issue and one that mocks, has been working since the start of the administration to try and, make a better reality.
1:31:32
So I mentioned we have our related party transactions policy and procedure that has been vetted with members of the vendor community, that's been vetted with, stakeholders with, procuring agencies with oversights to make sure it's effective.
1:31:45
That is, and I I do want to emphasize, we're purposefully being very rigorous in developing these these things.
1:31:51
The last thing we wanna do is set out a policy that will make it harder for the vast majority of good acting non profit providers to do their day to day job.
1:31:59
So those are going through the process of the VCC, and and and we hope, as I said, to have those out in 2025.
1:32:05
So in particular, regarding related party transactions, the city has, for the first time in, I think, a very long time, been able to enhance, and we're looking to have that out in 2025.
Molly Wasow Park
1:32:14
Council member, I wanna correct my statement on the record.
1:32:16
I'm sorry.
1:32:17
We do still have 2 contracts with Subco.
1:32:20
Apologies.
1:32:20
I got them mixed up with a a different vendor.
1:32:22
But what we are doing when we have identified a related party transaction, is sort of one of 2 pathways.
1:32:29
In some cases, we've we've ended business with the vendor entirely.
1:32:32
That was the case with CORE, which is another one that was called out in the report.
1:32:36
Or we have taken very aggressive action to ensure that they are no longer allowed to use their their related sub entity.
