Mayor Cherelle Parker wanted to prove the doubters wrong. Philly could pull off a celebration worthy of America’s 250th birthday.
- “I can remember feeling the pressure of folks saying, ‘Philadelphia lacks ambition,'” she said during a July 1 news conference, days before the One Philly Unity Concert for America. “They’re thinking too small … Where is the legacy project?”
Why it matters: The star-studded Fourth of July concert and fireworks show was certainly ambitious: It cost city taxpayers a whopping $15.5 million — more than double the cost of Welcome America’s 2024 festivities.
- But Axios found the city didn’t seek competing bids or proposals for the event before hiringpolitically connected ESM Productions, prompting scrutiny and calls for an investigation.
State of play:City procurement rules generally require a competitive process for major contracts.
- Instead of seeking new bids for the July 4 celebration, the Parker administration relied on a roughly yearlong agreement between the Philadelphia Authority for Industrial Development (PAID) and ESM Productions, according to an Axios review of the city’s procurement filings and records obtained through a Right-to-Know request.
- The agreement was also used to produce the city’s first-ever free New Year’s Eve celebration last year, headlined by rap legend LL Cool J, Kevin Lessard, a spokesperson for Philadelphia Industrial Development Corporation (PIDC), which manages PAID’s day-to-day affairs, confirmed to Axios.
- The city declined to say how much it paid ESM for the NYE celebration.
Reality check: This isn’t how Philadelphia handled other major event contracts.
- Philadelphia bid out the Made in America festival in 2018 and 2022 — even though thoseevents costa fraction of this year’s Fourth of July festivities.
Meanwhile, the Parker administration is seeking bids for a contract worth up to $75,000 to produce an economic impact report on this year’s 250th anniversary events.
What they’re saying: Legal and government watchdogexperts tell Axios the deal raises questions about whether the city followed competitive procurement requirements designed to promote fairness, transparency and the best value for taxpayers.
- “If this came by my desk, I would ask a lot of questions,” UPenn law professor Richard Feder, a former chief deputy city solicitor who advised Philadelphia officials for three decades, tells Axios.
- “Good government principles would suggest that the better route is for a contract of that nature ought to be publicly bid.”
A “favored” company
Follow the money: Financial records show the city never wrote ESM a check, instead routing payments throughPAID, the redevelopment arm of city nonprofit PIDC.
- The payments appeared as “city contributions” to PAID, finance records show. But accompanying payment records told a different story: “ESM Productions for City’s 4th of July Event.”
- The city paid for the concert out of its Class 500 budget category, emails show — which is typically used for contributions to schools, nonprofits, tax payments and legal settlements.
- Feder says professional service contracts should come out of Class 200.
The other side: City officials say the work ultimately stemmed from a bidding process that occurred more than 18 months before Parker’s July 4 plans and wasn’t specific to the concert.
- Lessard tells Axios PAID simply acted as a “financial conduit” for the payments and that doing so “doesn’t replace or bypass any procurement requirements,” which remain the city’s responsibility.
City attorney Andrew Richman told Axios in a statement that the city used an existing contract with PIDC to administer an “economic stimulus program.”
- Under that agreement, PIDC “issued an RFP on behalf of the City for various on-call strategic support services,” and ESM was selected.
- “This process allowed the City to engage ESM to produce the One Philly Unity Concert for America,” Richman wrote.
The city declined to make officials available to answer detailed questions about the process. ESM didn’t respond to Axios’ requests for comment…