• Polk County Public School officials ducked Florida’s laws on competitive bidding by using a Texas middleman to broker a lucrative, pre-negotiated contract with a school bus camera company.
• After questions arose about the original contract’s illegal payment scheme, Polk officials renegotiated the deal, but won’t say how they did so without violating Florida procurement laws.
• The vendor is Verra Mobility, formerly known in Florida as American Traffic Solutions, the same company that was kicked out of multiple cities for red light camera abuses.

Officials working for Polk County Public Schools (PCPS) are facing new legal questions swirling around its new school bus camera contract, a program aimed at trying to keep students safe. But the program itself remains embroiled in controversy thanks to an illegal payment scheme and how the contract was amended without going through a transparent competitive bidding process.

Initially, school officials managed to sidestep Florida’s competitive bidding laws by using a little-known legal loophole, a Texas based cooperative known as the Houston-Galveston Area Council (HGAC). Polk officials used the out-of-state middleman to secure a “pre-negotiated” deal with Verra Mobility, allowing school officials to avoid Florida’s far more transparent process for awarding contracts. But what started as a sketchy workaround to duck public scrutiny and save time has since unraveled into a tangled legal mess for the school district.

The trouble began when questions surfaced late last month about the obvious illegality of the payment terms in the ill-fated original contract. After initially denying the problem existed, PCPS officials said they would address the matter by “clarifying” the language in the contract to ensure the payments were compliant with Florida law. But amending an already “prenegotiated” contract opened a new can of worms for district officials, and now they are refusing to provide answers.

Earlier this week, Polk Schools acknowledged a new deal had been negotiated, but a spokesman refused to explain how the new agreement could have been forged without breaking Florida laws that require the rebidding of competitive procurements. In short: Polk officials tried to duck Florida law by avoiding negotiations in the first place, using HGAC to handle the matter. But after learning that the prenegotiated deal contained an illegal payment scheme, Polk needed to renegotiate the terms to comply with Florida law. How they did so without opening up the entire process to other bidders in a transparent way – required under both Florida law and HGAC rules – remains a mystery.

In Detail: How Polk Officials Skirted Florida Procurement Laws via HGAC

To pull off the first deal, Polk County turned to HGAC, a Texas-based cooperative purchasing group, to secure the contract with Verra Mobility. HGAC allows local governments to bypass the traditional competitive bidding process by letting them piggyback on contracts already negotiated out-of-state. This no-bid process offers speed and convenience but comes with a catch—the terms are locked in as part of the cooperative agreement.

That last sentence is critical. The entire point of a pre-negotiated deal is that the terms are locked and can’t be changed in any substantial way without reopening the entire process to the public and soliciting new bids. That’s exactly what Polk officials sought to avoid in the first place.

Unfortunately for Polk County, those pre-negotiated terms included a payment structure that had already been outlawed in Florida. The original deal’s terms called for paying Verra Mobility a whopping $49 for each traffic violation their computer systems processed. Deals like that, critics say, incentivize companies like Verra Mobility to aggressively issue citations in order to generate more cash – a practice that Verra Mobility has been accused of repeatedly. And in fact, those kinds of cash incentives are specifically banned under Florida’s House Bill 1363, passed earlier this year – making the pre-negotiated Polk County school bus camera contract illegal.

Faced with mounting scrutiny, PCPS officials on Wednesday released details of a renegotiated payment scheme with Verra Mobility, and even helpfully included an email from a Polk County law firm explaining that the renegotiated terms of the contract were, at least in their lawyer’s opinion, probably legal. After a bit of hemming and hawing, the informal legal analysis concludes with a series of caveats that the analysis could change based on legal developments.

“…it appears that the proposed Service Fee Schedule in Exhibit ‘A’ as established in the Second Amendment would comply…(with Florida law),” wrote John Murphy, an attorney with Boswell and Dunlap, LLP who specializes in local government law.

Of course, that’s where things get really murky, because while Polk County was busy focusing on making the payment scheme legal, there’s no evidence to prove that they followed Florida law governing contract negotiations, and in fact, aren’t answering basic questions that might clear the matter up.

The Catch-22: How Did Polk County Legally Renegotiate a Pre-Negotiated Deal?

All of HGAC’s contracts are pre-negotiated, meaning the terms—including pricing and payment structures—are already set when a local government opts into the deal. According to HGAC’s own manual, renegotiating one of the most important elements of the contract – the payment scheme – should automatically trigger HGAC’s recompete clause (see section 14.1 on page 62), which means that other potential vendors are allowed to submit their own competitive bids for the new contract.

But Polk County Public Schools declined to provide any evidence showing that they followed HGAC’s rules. When asked for details on how the contract was renegotiated so quickly, school officials remained tight-lipped and used the excuse that the act of providing simple factual answers was not possible due to the school district’s “process.”

“Sorry again, but we have no additional comment at this time,” wrote Polk County Public Schools spokesman Kyle Kennedy in an email response to a series of questions about the deal. Kennedy then suggested that The Capitolist seek answers through a time consuming and expensive public records search.  “Not trying to be difficult, but that’s our process; public records are separate from our PR department.”

For the record, The Capitolist did not ask for any public records, instead, we just asked a series of seemingly simple questions that could be answered factually by Polk officials.

It’s not clear why the school district is being evasive about the new contract. But if the county engaged in direct negotiations with Verra Mobility, those negotiations would have been subject to Florida’s procurement laws. And if they used HGAC as a middleman to negotiate, that, too, should have triggered a re-opening of the competitive bid process.

The Renegotiation Mystery

So what exactly changed in the “renegotiated” contract? According to PCPS, Verra Mobility is now compensated based on “program revenue,” though officials have refused to define what that means. With traffic violation fines being the primary source of program revenue, it’s unclear how this new structure differs from the original illegal payment scheme that paid Verra Mobility per violation. Both payment schemes depend substantially on the variable revenue generated by traffic violations.

If the bulk of the revenue still comes from those fines, the renegotiated contract may simply be a rebranded version of the same illegal structure. And with no clear explanation from PCPS, there’s growing suspicion that the district has once again found a way to bypass the law under a new guise.

What’s Next?

As Polk County Public Schools continues to refuse to provide clear answers, the clock is ticking. The first traffic fines – as high as $225 per violation – are set to be issued later this month under this still-murky contract, and the district’s unwillingness to explain how the deal was renegotiated leaves taxpayers, parents, and drivers in the dark.