Philly’s online sheriff sale contract violated city charter

A controversial city contract that outsourced Sheriff sales to a private online auction house was issued in violation of Philadelphia’s government contracting laws.

In March, Sheriff Rochelle Bilal announced through a series of town halls that sales of distressed real estate would resume after a year’s hiatus caused by the pandemic, but with auction operations contracted out to a Maryland-based company known as Bid4Assets. The shift triggered an outcry among housing activists and pols who said they were blindsided by the move –– culminating in a court order suspending foreclosure sales once again.

But Philadelphia’s Home Rule Charter explicitly states that the city’s Law Department “shall prepare or approve all contracts” issued by the city. In an email, Law Department spokesperson Andrew Richman acknowledged that oversight did not occur in the Bid4Assets contract.

“The Law Department was not involved in the approval or preparation of this contract,” he said.

In hearings called by Councilmember Cherelle Parker earlier this month, Sheriff’s Office officials acknowledged that they had not issued a traditional request for proposals after electing to outsource auction functions, simply awarding a six-year contract to Bid4Assets after an internal review.  At the time, Undersheriff Curtis Douglas explained the office felt an urgent need to resume sales and difficulties raised by pandemic lockdowns led the office to eschew traditional contracting procedures.

That explanation did not stop Councilmember Helen Gym’s questions about the Law Department’s involvement –– or lack thereof –– in the contracting process. Gym, on Friday, tied the irregularities to a lengthy history of corruption at the office, which saw one of Bilal’s predecessors, John Green, admit to taking bribes in a contract steering scheme.

“There’s a reason why this issue is critically important and why there’s concern there was a no-bid contract done without any oversight or Law Dept approval despite the fact it’s in the city charter,” she said. “The history of this office shows why oversight is important. It’s not merely a technical bureaucratic requirement.”

A spokesperson for the Sheriff’s Office declined to comment. Bid4Assets CEO Jesse Loomis did not immediately give comment on the issues.

Gym called on the city to take immediate action in the short term.

“There needs to be a thorough review of the entire process. And that’s where we have to start,” she said.

What should happen next isn’t totally clear, according to sources involved in city discussions. Invalid contracts would need to be amended or possibly voided and reissued, but more complicated is the status of hundreds properties sold at auction under the terms of a voided contract.

Further, the Law Department would have to represent the Sheriff in any forthcoming civil actions as a result of the contract.

Richman, from the Law Department, declined to disclose additional details.

Pat Christmas, policy director at the government watchdog the Committee of Seventy, said the nature of the obscure and independently elected office seemed to engender poor oversight and corruption. He called for the Sheriff’s functions to be merged into other parts of city government.

“This is why this office is off on its own island in city government,” he said. “It has had issues for years, over multiple administrations. Why is this even a separate elected office?”