The state Department of Commerce's executive broadband manager told lawmakers on Thursday that the department should issue a new request for proposals to hire a consultant to develop a statewide broadband implementation plan.
Steven Porch made that assertion before the Legislative Council's executive subcommittee, despite the secretaries of the departments of Commerce; Finance and Administration; and Parks, Heritage and Tourism selecting the Broadband Development Group of Little Rock as the consultant. The Commerce Department issued a request for proposals last month.
Porch's comments surprised lawmakers on the subcommittee, prompting the eight-member panel to delay action until next week on the Commerce Department's proposed $2.2 million contract with the Broadband Development Group.
The Legislative Council has authorized its executive subcommittee to make the final decision on the contract.
The subcommittee's co-chairman, Sen. Terry Rice, R-Magnolia, said he wants to give subcommittee members time to digest the information they received Thursday.
"In light of the testimony and questions this morning, I am not calling for a new [request for proposals] at this time," he said.
The Broadband Development Group is one of three companies that submitted proposals after the request for proposals was issued Aug. 16. The deadline to submit proposals was Aug. 23. Deloitte Consulting and CostQuest Associates also submitted proposals.
Broadband Development initially submitted a proposal with a $2.75 million price tag, while CostQuest Associates of Cincinnati submitted a proposal with a cost of $533,600 and Deloitte Consulting LLP of Austin, Texas, proposed to do the work for $489,273, according to state records.
The proposals were scored by state officials based on cost and a technical review by one information technology employee apiece from the Commerce, Finance and Administration, and Parks, Heritage and Tourism departments.
CostQuest Associates' proposal received the highest score at 881.7; Deloitte Consulting's proposal got the second-highest score at 801.7; and Broadband Development's proposal was scored at 461.3, according to state records.
Parks, Heritage and Tourism Secretary Stacy Hurst told lawmakers that she, Commerce Secretary Mike Preston and Finance and Administration Secretary Larry Walther unanimously selected Broadband Development.
She said she has been heading the effort to secure a consultant because she is leading Gov. Asa Hutchinson's broadband working group within the governor's Cabinet.
Hurst said she, Preston and Walther and their staff experts and an American Rescue Plan consultant, The Center for Toxicology and Environmental Health, were involved in the evaluation and discussion of proposals.
"Following extensive discussion and negotiation, we determined that the Broadband Development Group offers the most advantageous proposal for Arkansas as we endeavor to undertake this important work," she said.
Hurst said the company's proposal included a comprehensive master plan for statewide broadband deployment, including a detailed and extensive community outreach plan that includes all 75 counties.
Through negotiation, Broadband Development reduced its initial offer by 19%, she said.
"We found other respondents to be qualified, [but] their were proposals were deficient or lean in certain areas that we deemed were important for a comprehensive plan," Hurst said.
But Rep. Howard Beaty, R-Crossett, said Broadband Development submitted the highest bid and received the lowest score, yet the other proposals were rejected.
"I just have a problem with that when they are the lowest scored and the highest cost, and it just doesn't make sense to me," he said.
Rep. Jon Eubanks, R-Paris, said he had the same concerns as Beatty.
When questioned by Beaty, Porch said Broadband Development's proposal has "a better boots on the ground approach" among the three proposals.
He said his concern is the company hasn't previously done a statewide broadband implementation plan.
"I think they need to become more robust in what they were doing," Porch said. "They have not done a statewide plan and I have not minced words about it.
"I think there is a lot of work that needs to be done, and the [request for proposals] process needs to happen again, so we can get the best things for Arkansas, so we can do this once and do it right," Porch said.
"If these three parties, in addition to others, want to resubmit a more robust plan that is in line with what you have required and demanded and what Arkansas deserves, then so be it."
Sen. Missy Irvin, R-Mountain Home, said the Commerce Department's request for proposal standards seems to have been applied through the Office of State Procurement.
"I guess I am going to have to respectfully disagree [with Porch]," she said. "We don't need another RFP."
At that point, Porch said, "I will work with whomever is chosen to make sure we get the best outcome for the state of Arkansas. That's my word today."
Commerce spokeswoman Alisha Curtis later said Preston "has not had a chance to watch all of today's testimony."
"He is in favor of the proposed contract that was presented today and does not feel a new RFP is necessary," she said in a written statement.
"Steven Porch is a valued member of the Commerce team and has done outstanding work leading the broadband office, he will continue to serve in that capacity and in his dual role as Chief Legal Counsel to the Department," Curtis said in response to the Arkansas Democrat-Gazette's question about whether Porch's testimony affected his continued employment.
So far, the Commerce Department has spent about $275 million on broadband grants through the Arkansas Rural Connect program.
Two weeks ago, Hutchinson set a goal for the broadband grant program to award $250 million more in grants financed with federal American Rescue Plan funds by the end of this year.
Irvin said spending $2.2 million in federal funds to hire a broadband consultant pales in comparison to spending more than $500 million on broadband grants.
"We need an architect to create a comprehensive approach to expanding broadband to all areas of the state of Arkansas," she said. "We are building a building without an architectural plan. That's what we are doing right now, in my opinion."
Irvin said she fully supports hiring Broadband Development as the consultant.
Senate President Pro Tempore Jimmy Hickey, R-Texarkana, said if Broadband Development doesn't "perform, then we are not going to pay that money, so it is almost like what we got out here is a building project that requires these draws to be done as the work is performed."
Sen. Charles Beckham, R-McNeil, asked Hurst whether the initial intent was to award the contract to Broadband Development without going through a request for proposals.
Hurst said "yes," through a special procurement.
Afterward, Department of Parks, Heritage and Tourism spokeswoman Melissa Whitfield added that, "We considered several options including a special procurement or sole source, but decided against that and to open it up for competition through a procurement process called a MAP [Most Advantageous Proposal]."
Beckham asked if the Broadband Development Group was involved with writing the request for proposals. Hurst said not to her knowledge.
The Broadband Development Group's board of directors includes Aaron Bragg, son of Rep. Ken Bragg, R-Sheridan, and Ryan Holder, the husband of Arkansas Highway Commissioner Marie Holder, according to state records. The records show that Aaron Bragg has a 10% ownership interest and Ryan Holder has a 5% ownership interest.
Attorney Martha Hill is a registered lobbyist for the Broadband Development Group, while the Gilmore Strategy Group -- led by Hutchinson's chief political strategist and former deputy chief of staff Jon Gilmore -- is a registered lobbying firm for Deloitte Consulting, according to the secretary of state's website. Hill is the wife of U.S. Rep. French Hill, R-Ark. CostQuest Associates doesn't have a registered lobbyist in Arkansas, based on a search through the secretary of state's website late Thursday afternoon.