The mayor's response to my letter in the paper contained misleading and inaccurate statements. I have read Camp Verde Town Code, the Town of Camp Verde Financial Operations Guide and the State of Arizona Procurement Code as well as had several communications with Michael Showers, Camp Verde Finance Director and also spoke with the State of Arizona Procurement Office Compliance Officer. See below my findings and conclusions.
1. Lee Davis was the contact for National Bank, Mesa, Arizona. I was aware that the contact was not located in Camp Verde that is why I was careful to say that National Bank has a presence in Camp Verde and the closest branch for US Bank is Prescott.
2 and 4. The Town Manager presented at the council meeting that the decision could have gone to either bank. If a low bidder legal challenge was possible, he should have presented that information. It was not mentioned by anyone in attendance nor stated by the Mayor as being a factor in his decision. The possibility of a low bidder challenge in this instance is pure fabrication. According to the Arizona State Compliance Officer, the Town of Camp Verde's Request for Proposal would have had to state - contract to be awarded to the lowest bidder. This was not noted nor implied on the RFP. The Compliance Officer went on to say they would never recommend stating on a RFP that the contract will be awarded to the lowest bidder for service agreements because services usually include other cost factors and fees.
In this case, US Bank provided the lowest interest rate but a 3% prepay fee and National Bank had a slighter higher interest rate but could potentially have an escrow fee of a couple hundred dollars. Considering all financing cost components it would have been extremely difficult to determine the lowest bidder without making assumptions regarding the "possible" fees.
Staff recommended US Bank, but ultimately it is the responsibility of council to gather information, do the research, ask questions and vote in the best interest of the people of Camp Verde.
3. Refer to my previous letter. Finance Director Michael Showers told me that the overriding factor in his decision to recommend to council US Bank was the possibility of an escrow fee from National Bank IF the funding of the transaction was not completed by September 7th. Admittedly, he did not forward that information to council and there was no discussion or questions raised during the meeting about possible escrow fees. It is not clear how this could have been a factor in the decision process.
5. I agree with the Mayor, bids should not be awarded simply because the vendor or service is local. All terms and conditions of the purchase as well as the financial impact should be considered. According to the Compliance Officer, it is legal to have a policy that prefers doing business locally. They are many municipalities that have such a policy, namely the City of Phoenix.
For clarification, Council packets are not sent out to the public, they are available to the public through the Town of Camp Verde website, Quick Links, Town Council Agenda.
Finally, it did not go unnoticed by the public at the August 17th council meeting that Mayor German did ask for public input on agenda items. I appreciate that the Mayor read my letter in the Bugle printed August 17th and made a positive step to involve the public at council meetings during the agenda items presentation. Thank you.