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R.I. House speaker questions no-bid consulting contract at Rhode Island College

The $76,000-a-week contract with N.Y.-based Alvarez & Marsal started on Dec. 14 and will run through Feb. 28, but state lawmakers have railed against it since the Globe reported the terms of the agreement on Monday

Providence  RI 1/5/21  05RIASSEMBLY  New  Speaker of the House, Joseph Shekarchi, a Warwick Democrat giving a speech after he was voted in as the Speaker of the House at Veterans Memorial Auditorium. (photo by Matthew J. Lee/Globe staff)
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Providence RI 1/5/21 05RIASSEMBLY New Speaker of the House, Joseph Shekarchi, a Warwick Democrat giving a speech after he was voted in as the Speaker of the House at Veterans Memorial Auditorium. (photo by Matthew J. Lee/Globe staff) Topic: Reporter:Matthew J. Lee/Globe Staff

PROVIDENCE – House Speaker Joseph Shekarchi said Tuesday he has asked the House fiscal staff to investigate how a consulting firm secured a $76,000-a-week no-bid contract to review the programming, operations, and finances at Rhode Island College.

The contract with New York-based Alvarez & Marsal started on Dec. 14 and will run through Feb. 28, but state lawmakers have railed against it since the Globe reported the terms of the agreement on Monday.

It is being paid for by the Office of the Postsecondary Commissioner, and was approved by the state Department of Administration, according to Council on Postsecondary Education Chairman Tim DelGiudice.

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“I was unaware of RIC’s actions and it is obviously concerning to me that the college awarded a consulting contract without competitive bidding,” Shekarchi said. “I have spoken with Chairwoman Patricia Serpa and I have asked the House Oversight Committee to seek more information and potentially conduct a hearing.”

Serpa said she was outraged to learn about the contract, and said the issue will be a top priority for the House Oversight Committee.

“It’s a blatant, cavalier attitude with the use of taxpayer money,” Serpa said.

DelGiudice said that the council wanted to expedite the firm’s review of the college in order to include any of its recommendations in Governor Gina Raimondo’s budget proposal for the fiscal year that begins July 1. He said the state is familiar with Alvarez & Marsal because the firm has worked with other parts of the state’s government.

Records show several state agencies paid Alvarez & Marsal $1.25 million in the 2020-’21 fiscal year, $1.4 million in the 2019-’20 fiscal year, and $936,000 during the 2017-’18 fiscal year, including the Department of Administration, Department of Children, Youth and Families, Office of Health and Human Services, and the Department of Health.

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But Serpa said the all state departments have been told to limit their spending as the state seeks to navigate the COVID-19 pandemic, and a $76,000-a-week contract isn’t something that should just fly under the radar.

“What does the does council not understanding about no new spending?” Serpa asked.

Rhode Island College announced it August that it was seeking to slash expenses by 15 percent to reduce a projected $10.4 million shortfall. The school cut the salaries of executives, laid off staff, and declined to fill most vacant positions.

The Alvarez & Marsal review is designed issue recommendations that will produce longer-lasting structural savings, but Serpa said the public and private colleges around the state should get together to come up with plan to emerge from the pandemic.

“What would that cost, a couple of lunches?” Serpa quipped.


Dan McGowan can be reached at dan.mcgowan@globe.com. Follow him on Twitter at @danmcgowan.