Steelcase Tops FPI For Contract

June 20, 2003
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WASHINGTON — After a months-long battle, Steelcase Inc. has won a $6 million contract bid to outfit the new Washington, D.C., headquarters of the Federal Aviation Administration (FAA), Congressman Vernon J. Ehlers announced today.

The announcement marks the end of a conflict that involved the Grand Rapids-based office furniture manufacturer pitted against the Federal Prison Industries (FPI) program, also known as UNICOR.

Following several sometimes-heated meetings involving Ehlers, Congressman Pete Hoekstra, R-Holland, Sen. Richard Shelby, R-Ala., and officials from the FAA, FPI, the General Services Administration (GSA) and others, FPI Chief Operating Officer Steve Schwalb, in a June 19 four-page letter to the FAA, announced that FPI would “relinquish its right to participate in the project.”

“I am extremely pleased to see this positive outcome for Steelcase and its employees,” said Ehlers, R-Grand Rapids. “I believe that FPI operated very inappropriately in trying to take over this contract and I am gratified that our hard work was able to reverse the tide.”

A Maryland-based dealer for Steelcase Inc. was notified in February that it submitted the “best value” bid to furnish the FAA’s new headquarters after a competitive process, but then lost the bid when FPI used a new procedure allowing it to review the Steelcase bid and match it identically. The contract calls for delivery and installation of more than 900 workstations along with associated furniture such as chairs, file cabinets, walls and other items at a total cost of more than $6 million.

In his letter, Schwalb claimed that FPI did not “engage in any impropriety” regarding the contract, but Ehlers said FPI’s efforts to essentially copy Steelcase’s bid in order to win the contract at least had the look of impropriety.

“I have many years of experience with the government bidding process,” Ehlers said. “It is important to maintain the integrity of the bidding process. It is incredibly unjust for a federal agency to take a contract away from the lowest bidder after the bidding process is complete.”

“We are very pleased with the outcome,” said Rick Yeates, vice president and general sales manager for Steelcase. “This would not have happened without Congressman Ehlers’ leadership. On behalf of all the workers at Steelcase, we are extremely grateful for his efforts.”

Ehlers said the experience only emphasizes the need to reform the FPI program.

“I strongly support Congressman Hoekstra’s efforts to totally reform this badly flawed program,” Ehlers said. “It is important to provide prison inmates meaningful work that can help the rehabilitation process, but it should not be done in a procedurally flawed manner at the expense of the jobs of law-abiding citizens.”           

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