PROVIDENCE — Federal authorities are involved in the investigation of a controversial contract for up to $5.2 million that Governor Daniel J. McKee’s administration awarded to ILO Group, a consulting firm that formed two days after McKee took office.
“We’ve been made aware that the attorney general is partnering with the US attorney’s office on the ILO review,” said administration spokesman Matt Sheaff Thursday. “As we’ve said previously, we’re fully cooperating with this review.”
The McKee administration has faced scrutiny over the contract, which was awarded to help with reopening schools after the pandemic and to launch municipal education offices modeled after one that McKee established while mayor of Cumberland.
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The consulting firm formed two days after McKee took office and one day before McKee took part in a Zoom meeting with Chiefs for Change CEO Mike Magee, a McKee ally and donor who mentioned ILO during the call. That meeting led to a contract for ILO, whose managing partner, Julia Rafal-Baer, then worked for Chiefs for Change and had been invited to the Zoom meeting.
The House and Senate oversight committees have grilled the administration over the contract award, with legislators noting that Rafal-Baer was on a state task force that issued a report on issues that ILO was later hired to address.
Attorney General Peter F. Neronha’s office and the State Police have confirmed they are investigating the circumstances surrounding the award of the ILO contract.
McKee administration officials have maintained the process ended up being fair, thorough, and competitive. McKee has defended the contract award, saying he has been assured that the state procurement process for the ILO contract was done correctly.
WJAR-Channel 10 and WPRI-Channel 12 reported that the FBI is now involved in the investigation, and news of the federal involvement drew immediate criticism of McKee, who is running for a full four-year term in this year’s gubernatorial race.
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“It’s unfortunate that with all the challenges Rhode Island students continue to face, it increasingly looks like Governor McKee chose to make a special handout to his political allies in the ILO Group, one of his administration’s very first actions,” the Rhode Island Working Families Party tweeted.
“Rhode Island’s working families deserve a government that is fair, transparent, and works in their best interest,” the group said. “The ILO contract situation — and the ongoing investigation by the US attorney’s office and the FBI — undermines all Rhode Islanders’ trust in government, and suggests a move backwards to the very culture of backroom dealing that we have all been trying to leave behind.”
Former secretary of state Matt Brown, one of the Democrats challenging McKee in a gubernatorial primary, said he hopes the FBI will get to the bottom of what happened.
“The endless cycle of indictments and FBI investigations will continue until we oust the corrupt political machine that has been running our state for decades,” Brown said. “Rhode Islanders are sick of the politicians and corporate CEOs who are running things, always looking out for the interests of the wealthy and well-connected. Last year, as Rhode Islanders struggled to afford their basic needs like housing and health care, Governor McKee awarded a multimillion dollar contract to a consulting firm tied to one of his top campaign donors.”
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Another Democratic gubernatorial candidate, former CVS executive Helena Foulkes, said, “For many Rhode Islanders, this story feels all too familiar: Yet another career politician finds himself in the shadow of an FBI investigation. Once again, Dan McKee has shown that he cares more about enriching his well-connected friends than serving the people of our state. How can Rhode Islanders possibly trust him now?”
Edward Fitzpatrick can be reached at edward.fitzpatrick@globe.com. Follow him @FitzProv.