A Cloud Of Corruption Over City's Purchase of New Voting Machines

By Ralph Cipriano
for BigTrial.net

There was no formal announcement made or press conference held to commemorate the event. But the week before the May 21st primary election, the Kenney administration quietly signed a $29 million contract to buy new voting machines.

Two weeks later, when the election was over, and the mayor victorious by a landslide, his spokesman confirmed last Friday that the voting machines contract had indeed been "signed by all parties and finalized in the city system." The unannounced contract includes an additional $6 million in possible contingency costs, which would put the total purchase at $35 million, with additional expenses expected to follow.

While the city administration proceeds with plans to buy what critics say are the most expensive and riskiest voting machines out there as far as hackers are concerned, the ExpressVoteXL, the controller's office has issued two series of subpoenas prying into the secrecy of the procurement process behind the purchase. With the assistance of outside counsel, city Controller Rebecca Rhynhart is proceededing with her own investigation of the murky deal that may ultimately cost taxpayers more than $50 million.

The controller has previously stated that she intends to block the purchase because she's "deeply concerned about the legality of this process." 

It's a process that featured a cast of anonymous city officials reviewing specs and making confidential recommendations behind closed doors, a process that according to critics, was slanted to favor one particular vendor.

So the Kenney administration and the controller are headed for a confrontation that may end up in court, as flacks for both parties last week issued dueling statements warning each other about legal liabilities. But regardless of how the battle of City Hall turns out, there's a cloud of corruption hanging over the voting machines purchase that isn’t going away. It emanates from the federal indictment of labor leader John "Johnny Doc" Dougherty and extends straight to City Hall.

Nobody's talking about it in a town where general elections are as meaningless as the ones held in Vladimir Putin's Russia, and local journalism is on life support. But all you have to do is read the indictment to connect the dots and realize that while the Kenney administration and the controller are duking it out, the feds are probably watching. Because both the indictment and the voting machines purchase feature the same cast of characters, the same modus operandi. 

On page 111 of the federal 116-count indictment, the feds talk about Dougherty giving City Councilman Bobby Henon tickets to sporting events worth $11,807, tickets bought by Local 98 of the electricians union, as part of a conspiracy to deprive the citizens of their right to honest services from Henon:

"Defendant JOHN DOUGHERTY gave these things of value to defendant ROBERT HENON with the intent to influence HENON in HENON's capacity as a member of Philadelphia City Council, and performing official acts as directed by and on behalf of DOUGHERTY."

"Defendant ROBERT HENON accepted the stream of personal benefits from defendant JOHN DOUGHERTY, knowing that the benefits were given in exchange for HENON's performance of official acts at the direction of and on behalf of defendant DOUGHERTY."

Dougherty and Henon have both pleaded not guilty to the charges that remain allegations headed for trial.  But in addition to the sports tickets, the indictment says, Local 99 paid Henon a salary of $70,649 in 2015 and $73,131 in 2016 as part of that alleged conspiracy to deprive the citizens of Henon's honest services:

"At defendant JOHN DOUGHERTY's direction, defendant HENON drafted, supported, advocated and sponsored Philadelphia City Council legislation, resolutions, and other Council legislative activities that were favorable to defendant DOUGHERTY's personal, professional, or financial interests."

According to the indictment Henon drafted legislation at Johnny Doc's request to require all tow truck drivers in the city to take a special training course after Dougherty got tagged with a $190 parking ticket, and the tow truck driver couldn't give Doc $10 in change after Doc handed him $200 in cash. 

"That $10 is going to cost their f***ing industry a bundle," Dougherty told Henon on a wiretapped phone call in 2015, as he was ordering up the legislation. 

Elsewhere in the indictment, Dougherty told Henon to "stay INFRONT of the soda tax!!" as future legislation that Dougherty said would screw the Teamsters, a rival union that had run TV commercials portraying Dougherty in a negative light.

Fast forward to the purchase of the voting machines. It was Councilman Bobby Henon who in 2016, at the behest of the Kenny administration, introduced the best value procurement initiative as a proposed charter change. Henon was one of five co-sponsors of the bill that was approved by voters a year later.

The voting machines purchase, the controller says, was the first significant use of the best value procurement initiative, which was supposed to give the city more flexibility in awarding contracts by considering factors other than just having to automatically go with the lowest bidder. The way the city went about implementing the new charter initiative during the voting machines purchase, however, was to slap a confidentiality order on the process, as well as to bypass several lower bidders.

Mayor Kenney didn't see any problems when I asked him last month about any shadow cast on the voting machines purchase by the federal indictment of alleged co-conspirators Johnny Doc and Bobby Henon, who, according to the feds, were actively engaged in a conspiracy to deprive the citizens of Henon's honest services in favor of what's best for Local 98. 

"No," the mayor flatly said, the charter change was "duly passed legislation," so what me worry?

While Kenney was pulling an Alfred E. Neuman, critics see politics in play. The way the best value initiative was implemented by the Kenney administration, according to Mark Zecca, a former senior attorney with the city's law department, and an outspoken critic of the voting machines purchase, was to "promote secrecy in contracting, contrary to all modern transparency concepts; promote political patronage contracting; and eliminate accountability."

In Zecca’s opinion, the way the city implemented the best value charter change was illegal, as was the way they just awarded the $29 million contract.

You'd think the voting machines purchase would be subject to additional scrutiny since hackers just shut down websites and computer programs linked to Philadelphia's court system, but in Philadelphia, the politics of patronage outranks the safety of our election process. Who needs transparency?

Meanwhile, the feds aren't talking but they appear to be watching. A spokesperson for the U.S. Attorney's office, Jennifer Crandall, wrote in an email, "We cannot comment on an ongoing investigation."

Back at City Hall, mayoral spokesman Mike Dunn divulged details of the voting machines contract in an email:

"The maximum contract amount is $35 million, but the difference of $6 million is simply a contingency and is not an obligation," Dunn wrote. "Of that $29 million, $26 million are capital dollars and the remainder are operating budget dollars. Please keep in mind that the project will have ancillary costs that are not included in this contract. Also, we are currently engaged in conversations with the Wolf administration and our partners in the state legislature to determine potential levels of reimbursement that would be provided to Philadelphia . . . to cover the costs of this state-mandated initiative."

Of that $26 million outlay in capital funds, the administration has proposed moving $22 million from the operating budget's so-called rainy day fund into the capital budget to spend on voting machines. Another $4 million for the capital budget will be borrowed from the budget of the city's Office of Innovation of Technology, to help pay for the voting machines purchase.

About the impending conflict with the controller, Dunn wrote in another email that it was the controller's job to ensure that accurate payments are made pursuant to an appropriation. If there's a question about those payments, "those must be resolved by the Law Department,” Dunn wrote, “after reviewing any evidence provided by the finance director, the controller, and any other relevant officials."

So apparently the mayor's office isn't buying that the controller has the right to block the purchase. Dunn's email also implied that with the contract finalized, any future interference in the purchase by the controller may be problematic, not only for her, but also for the city.

"If any city official, including the controller, blocks or interferes with a payment that is legally due, that official risks causing costly legal liabilities not only for the city but also for that official," Dunn wrote.

In response, the controller's office issued the following statement:

"The controller's office is granted the authority to prevent improper payments by the Home Rule Charter. We're authorized to investigate the circumstances around any invoice to ensure it is 'justly due' or suitable for payment."

"Any purchase of this size warrants scrutiny, and given the importance of this particular purchase and the concerns about the process around it, we believe an investigation is not only appropriate, but necessary."

"Despite knowing our concerns and that our office has launched an investigation, the city decided to move forward with signing the contract. That doesn't change our focus -- our investigation is ongoing and our office will not authorize any payments of the voting machines until that investigation is resolved. It's what’s in the best interests of taxpayers."