N.Y. senator criticizes disputed DMV contract

Thursday November 15, 2012

ALBANY, N.Y. (AP) -- A New York senator said Wednesday that the state’s plan to choose the highest bidder to produce driver’s licenses with black-and-white images is unacceptable, while the state defended the company, saying it provides the most secure product.

"If it is an overbid, (it’s) unacceptable considering the problems we have with Hurricane Sandy, the devastation we see on the Eastern Seaboard," said Sen. Mark Grisanti, an Erie County Republican. "We need every penny we can get to help out the victims of Hurricane Sandy."

The Department of Motor Vehicles has tentatively selected a Canadian company for a contract that would cost $38 million more than the current vendor, according to court papers. The state Comptroller’s Office is reviewing the $88.5 million contact after the apparent losing bidders filed protests and a lawsuit saying they met all the specifications with color photos but were dismissed unfairly at a cost to taxpayers.

On Wednesday, the state defended its decision.

"The two losing bidders were not selected because their products were inferior with respect to document security and anti-tampering measures that are standard for licenses," state motor vehicles Commissioner Barbara Fiala said in a statement. "Since the driver license serves as a de facto national identification card, it is extremely important that the documents we provide the citizens of New York are the most secure and least able to be altered or counterfeited.

"We are confident that the vendor we have chosen will provide the best value for the citizens of New York," Fiala said.

The driver’s license contract is rebid under the federal "Real ID" measure from the Department of Homeland Security to make licenses more secure, and more states are expected to face similar contract decisions.

The Canadian company, CBN Secure Technology, is regarded as one of the leaders in the competitive industry of providers of secure government documents. Its other contracts including printing currency and passports.

The DMV chose CBN in a scoring system that put emphasis on the security of the technology. CBN submitted the only bid using a kind of technology that involves black-and-white photos, which is widely used in stats and by other governments in addition to the technology used by the apparent losing bidders.

The DMV tentatively awarded the contract to the highest bidder 10 months after New York advised the current vendor, De La Rue North America Inc., that because of "significant budgetary constraints" the state would have to reduce the cost of the contract, according to the court filings.

As a result, De La Rue submitted a bid 10 percent lower for the new, eight-year contract, which ended up being nearly $38 million less than CBN’s bid of $88.5 million.

De La Rue, based in England, and Massachusetts-based MorphoTrustUSA, another unsuccessful bidder, want a rebid. They claim the bidding was unfair because they didn’t known the DMV was interested in the black-and-white photo technology, according to a lawsuit filed in state Supreme Court in Albany. If they did, the companies claim they could have provided a lower cost to New York taxpayers.

"Government needs checks and balances to ensure a fair and open process," said Kate Gurnett of state Comptroller Thomas DiNapoli’s office, which continues its review of the bid and its protests. "Our independent contract review ensures that the law is followed, that vendors are properly chosen and that New York taxpayers get the best value."


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