June 30, 2024
by Michael R. Wickline | Arkansas Democrat-Gazette
The Arkansas Department of Commerce has awarded a two-year, $8.85 million contract to the Boston Consulting Group to assist the Arkansas State Broadband Office with the execution of the federal Broadband Equity, Access and Deployment Program under which Arkansas has been awarded a $1.024 billion grant.
The contract by Arkansas Department of Commerce’s Economic Development Commission with the Boston Consulting Group, based in Boston, is the company’s first executive branch agency contract based on the records in the Arkansas Administrative Statewide Information System (AASIS), said Brooke Hollowoa, a spokesperson for the state Department of Transformation and Shared Services.
The contract comes after the Boston Consulting Group had a “pro bono services” agreement that started Oct. 2 and ended Dec. 15, under which the consultant agreed to work closely with the Commerce Department and the Department of Transformation and Shared Services “to assess how well Arkansas state agencies are operating effectively,” including identifying “opportunities to streamline the government in order to enable the government to serve Arkansas stronger.”
Following the expiration of its pro bono agreement, the Boston Consulting Group lost its bid for a contract with the Department of Transformation and Shared Services to help Gov. Sarah Huckabee Sanders’ administration’s 15 executive branch agencies become more efficient and improve services. The contract was awarded to Washington, D.C.-based McKinsey & Co. after the department issued a request for proposals and received eight.
The Department of Transformation and Shared Services’ contract with McKinsey & Co. is for up to $5.5 million under the governor’s Arkansas Forward initiative. The Stephen Group of New Hampshire is the subcontractor for the McKinsey contract, said Hollowoa.
The Commerce Department’s proposed contract with the Boston Consulting Group cleared the Legislative Council’s Review Subcommittee on June 17 and the Legislative Council on June 21 without any questions from state lawmakers.
The Commerce Department did not bid out the broadband contract awarded to the Boston Consulting Group, said Clark Cogbill, a spokesperson for the department.
“It was procured under a Cooperative (purchasing agreement) Contract with Omnia Partners,” he said Friday in a written statement. “By using the Cooperative Contract with Omnia Partners, the Broadband team was able to move quickly, evaluate three options (including Boston Consulting Group, CostQuest Associates and McKinsey & Company), and then select the best partner.”
Asked whether the Boston Consulting Group’s previous pro bono work for the Commerce Department factored into the department’s selection of the company for the contract, Cogbill said in a written statement, “As part of the Cooperative Contract, the Department of Commerce sought out budget inquiries from three companies: Boston Consulting Group, CostQuest Associates and McKinsey & Company.
“It was determined that CostQuest Associates did not provide all the services required. Boston Consulting Group’s cost was significantly lower than McKinsey’s, and the Department of Commerce moved forward with BCG for the contract,” he said.
As for why the Commerce Department selected the Boston Consulting Group for the broadband contract, Cogbill referred to the department’s written request to the Office of State Procurement “to use the Cooperative Contract.”
The proposed $8.85 million cooperative purchasing agreement with OMNIA Partners for the state Broadband Office presents “a compelling economic justification for cost-effectiveness compared to conducting an independent solicitation, particularly in the state-administered execution of the federal Broadband Equity, Access and Deployment (BEAD) Program,” the Commerce Department said in its written economic justification statement.
“Through the BEAD program, Arkansas was awarded a $1.024 billion grant for broadband deployment,” the department said.
In addition, Arkansas must comply with the federal BEAD program’s immediate and firm time restrictions that have required the state Broadband Office to act expeditiously in acquiring services to facilitate execution of the grant, the department said.
The proposed cooperative purchasing agreement with OMNIA Partners of $8.85 million is significantly more cost-effective compared with $14 million and $10.5 million “informal budgetary estimates provided by other vendors,” the department said.
“This price advantage likely results from OMNIA leveraging the collective buying power of its members to negotiate lower prices,” the department said.
Read the full article HERE.
