Snafu 2000

Phoenix officials told volunteers planning an expensive millennial downtown bash to think big. It seems as though nobody was thinking at all.

But during the same period, city records show the Celebration 2000 Committee flagrantly ignored procurement rules -- with the city's tacit approval.

In late February, meeting minutes show the committee decided it needed to immediately secure stages and lighting for the New Year's Eve show. Rather than preparing a formal request for proposals and circulating it among the half-dozen or so qualified vendors in the Valley, Charlie Johnston cut a deal with On Cue Systems -- a company he regularly contracts with in his private promotion business, Select Artists Associates.

Johnston told the Celebration 2000 Committee at a March 15 meeting that he had spoken to Mark Cockriel of On Cue Systems and had been assured that the company could meet all staging requirements.

In an April 3 bare-bones contract proposal prepared by On Cue Systems, Cockriel promised to provide four stages with minimal lighting for a whopping $42,500 a stage.

The contract between Cockriel and the Celebration 2000 Committee (the CCC had not yet been incorporated) was signed by Grant Woods on May 24, and by Cockriel the next day. Not only did the contract lock the committee in for this year's show, it also guaranteed that On Cue Systems would provide stages for a planned December 31, 2000, celebration at the same $42,500-per-stage rate.

Though Woods had signed the contract, the Celebration 2000 Committee had no money -- even though the city council had approved a $25,000 appropriation last December. On June 17, the city agreed to "rush" the $25,000 payment.

Rather than depositing the money into an account controlled by the Celebration 2000 Committee -- which at that time was the only entity formally recognized by the city -- the $25,000 was deposited into a Citizens for Community Celebration account that Johnston had set up at Wells Fargo Bank. The city made the deposit into the CCC account on June 17, even though CCC would not sign a contract with the city until July 7, records show.

Johnston, who along with Woods, was a signatory on the CCC account, then issued a $10,000 check to Cockriel on June 18 as a deposit for the stages. The deposit check was sent 12 days before the Celebration 2000 Committee reviewed the contract and approved the $10,000 expenditure at its June 30 meeting.

Johnston says he negotiated the deal with On Cue Systems because it was the biggest firm in the Valley. "They are the one company in town that can do this," Johnston says.

Not so, says Joseph Lewis, owner of Spectrum Lighting, Sound & Beyond.

Lewis, who also is a Tempe city councilman, says his company received a call from a Phoenix official last March asking his company to make a bid on the stages.

"We were just asked to fax a quote for six stages," he says. "It was very, very vague."

Lewis says he asked for more details of what was to be required, but they weren't forthcoming. After reviewing a copy of On Cue System's contract provided by New Times, Lewis says his company could have delivered the same product for much less money.

"I guess it would have been around the $25,000 mark per stage," Lewis says.

City attorneys acknowledge that, while On Cue System's contract may have ignored city procurement regulations for failing to issue formal bids, such action is not necessarily illegal.

City attorney Philip Haggerty says the city is only required to seek competitive bids for public-works contracts, such as street and building construction. Nevertheless, the city follows detailed procurement regulations that normally require bidding on such contracts as the On Cue Systems deal, he says.

In this case, since the contract was signed by a city subcommittee -- Celebration 2000, on behalf of a nonprofit corporation, CCC -- Haggerty says there is little motivation for the city to intervene.

"The question is whether we want to force the corporation to go to public bids when they are using our money," Haggerty says. "They don't legally have to do it, and you can satisfy us with a halfway decent reason not to bid it."

The reason not to bid?

"This was an effort to secure those stages quickly so they wouldn't disappear," says Phoenix city parks official Michael Whiting.

Woods says that in retrospect the On Cue Systems contract raises serious questions, especially since the contract called for four stages and, after several acts were canceled, has since been reduced to three. Despite the reduction in the number of stages, On Cue Systems is still being paid $170,000.

"I don't know why it hasn't been renegotiated," Woods tells New Times. "It looks like it should be."

Woods says he has been contacted by a "couple of people" who said they would have liked to have bid for the contract.

"I think it is generally better to bid, but again the committee was being pushed by an urgency supposedly caused by the unique nature of the event, i.e. the 2000 celebration," Woods says.


While city officials refused to intervene on the $170,000 one-source contract with On Cue Systems, they jumped into the middle of a complicated series of negotiations with entertainers with disastrous results.

In late June, Johnston, Woods and Whiting met with Mayor Rimsza to go over planned entertainment. Johnston says he presented a detailed budget that showed the projected cost of each act, along with production expenses.

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