A consulting firm hired by ex-state Department of Social Services Director Lillian Koller when she earlier headed Hawaii’s social services agency received more than $10 million while in the Aloha State, and obtained a $6 million contract in South Carolina after Koller transferred here, records show.
And the South Carolina contract is on top of a $719,000 “emergency” procurement that DSS obtained for Benton & Associates Ltd. of Ellicott City, Md., which the S.C. Legislative Audit Council described as “improper” in a critical audit of the agency released earlier this month.
The audit found that a contract between DSS and Winthrop University for $20 million and two other contracts between DSS and the University of South Carolina for $50.8 million were the “result of non-competitive procurement methods.” That reduces the “probability that the vendors selected were the best combination of quality and price,” and also can “create the perception that contract awards are based on favoritism,” the audit noted.
Of the $20 million awarded to Winthrop University, $6 million, or 30 percent, will go to Benton & Associates if the firm fulfills the terms of its contract, Winthrop spokesman Jeff Perez told The Nerve last month. In a written response to The Nerve on Oct. 6, Perez said the firm to date has been paid $5,152,016, or nearly 86 percent of the total projected contract amount.
An initial cost proposal submitted in August 2011 by the Benton firm to the S.C. Budget and Control Board’s Procurement Services Division estimated annual costs, including wages, airfare and lodging, at $600,000, for a total of $3 million over the proposed “five-year life of this procurement.”
But a contract change order dated Oct. 17, 2012 — about 19 months after Winthrop and DSS signed a memorandum of understanding for the public university in Rock Hill to provide training and technical assistance to DSS — shows that the “total potential value” of the Benton firm’s contract was increased to $6 million from $3 million, according to a copy of the change order obtained last month by The Nerve from Winthrop under the S.C. Freedom of Information Act.
No reason was given in the change order for the 100 percent hike. The document shows a pay scale, effective July 1, 2012, for 11 named consultants ranging from $72.07 per hour to $237.32 per hour; the average hourly rate was $189.79.
DSS has faced a barrage of criticism this year from some lawmakers over understaffing in its child welfare division and child abuse deaths. To put the $6 million contract for the Benton firm in some perspective, DSS could have hired 120 child case workers with that amount, based on an annual salary and benefits of $50,000 per employee.
DSS spokeswoman Marilyn Matheus did not respond to two emails sent by The Nerve in August and last month seeking answers to the following questions about Benton & Associates:
n The specific purpose in hiring the firm.
n Length of contract.
n Total projected cost of contract.
n Source of payments (state, federal, other funds).
n Payments to date.
Given the agency’s non-response to the emails, The Nerve last week submitted a formal request under the Freedom of Information Act for copies of all contract documents and related records involving DSS and the Benton firm. That request is pending.
Bill Benton, who identified himself in the 2012 contract change order as the company’s vice president, declined comment when contacted by The Nerve, saying only, “I think you should get whatever you need from DSS. I appreciate the call; goodbye.”
Rick Brundrett is an investigative reporter for TheNerve.org, a website of the South Carolina Policy Council.