The New York City Council Committee on Contracts, chaired by Lincoln Restler, held an oversight hearing on transparency and accountability in the city's use of master agreements (MA1s and MMA1s). The hearing examined spending of over $8.8 billion through these contracts between fiscal years 2022 and 2025, with 28,000 delivery orders per year, and focused on the lack of public visibility into what is purchased, at what price, and by which agency. The committee heard from the Mayor's Office of Contract Services (Mox), the Department of Citywide Administrative Services (DCAS), the Office of Technology and Innovation (OTI), the New York City Comptroller's Office, and members of the public.
Good afternoon and welcome to the New York City Council here in for the committee on contracts. Please turn all devices on silent. Going forward, no one is to approach the dayus. If you have any questions or you want to testify testify as you want to decide on that ops. Chair, you may begin. Thank you so much, the Sergeant of Arms. Uh my name is Lincoln Wrestler. I have the privilege of chairing the committee on contracts. I would like to welcome my friend and colleague, the inimitable Gail Brewer. Thank you for joining us today. Today we're holding an oversight hearing on the city's use of master contracts. Master agreements made up about 17% of the city's contract spending over the past four years. We paid over $8.8 billion for these goods and services, and yet there is no meaningful public record of what we purchased. Master agreements are a critical and frankly helpful contracting tool. They are standing contracts that allow city agencies to quickly purchase laptops or hire security guards without running a new years-long, painful procurement process. The city signs one master umbrella contract, and every agency can then place individual orders off those contracts. It's essential that agencies have this flexibility in order to operate efficiently and serve New Yorkers well. But unlike regular contracts, where we have a detailed review process and transparent reporting on exactly what was spent, we currently have very limited information on purchase details for master agreements or MA1s. Public records show only spending, they're not here for the contracts hearing, that's why they're laughing so hard. Um the public records show only spending totals and not items, quantities, and company details. Last month, controller Mark Levine released a compelling report on these master agreement contracts. His office found that between fiscal year 2022 and fiscal year 2025, the extent of the Adams administration, mayoral agencies spent more than $8.8 billion through these delivery orders or DO1s, issuing more than 28,000 orders each year. The estimated values agencies put on these contracts at registration bear limited relationship to what the city actually ends up spending. Agencies have overspent the combined value of these master agreement contracts by more than 1.6 billion dollars over these this four-year period. In 2023, DCAS registered an emergency master agreement with Garner Environmental Services. The estimated value was about 30 million dollars. Since then, agencies have placed 103 delivery orders against that contract, spending more than $675 million, more than 20 times the estimated value of the contract. These were largely purchases to support asylum seekers, purchases that we absolutely needed to be able to effectuate quickly. But reporting later found that agencies paid wildly different amounts for the same service on this contract. HH, for example, Health and Hospitals paid $117 per hour for security guards, while NYSAM paid only $79 or New York City Emergency Management paid only $79 per hour for security guards, both far exceeding the city's rate on existing contract, $24 an hour with FJC, but I believe DHS holds, which is a union contract for security guards at you know less than a quarter of the price that it that HH paid. Examples like this illustrate that we need to eliminate the contract. We need examples like this illustrate not that we need to eliminate this important contracting tool, but that we need to increase transparency and implement more rigorous standards and review to ensure we are planning properly and always getting the lowest price to avoid wasting taxpayer dollars. The city's technology contracts are similarly opaque. OTI has a single citywide IT contract that covers 740 manufacturers and service providers. We have overspent on that contract by two billion dollars without any reporting on what we actually purchased. There is no way to look how many laptops or printers we purchased and how much they cost. While agencies are collecting invoices before making payments without centralized reporting on purchases, it's impossible for us to identify patterns and discrepancies between agency purchases. Today we are hoping to gain more insight into the current review practices and protocols at Mox, DCAS, and OTI, and OTI. We hope that the administration is committed to working with the council to increase transparency and oversight of this of this spending. I really do appreciate that the Mamdani administration has made clear that they are committed to identifying cost savings and efficiencies in contracts, and we hope to work together to identify additional savings that can be found through improved review protocols and systems upgrades. Before we begin, I'd like to just thank our terrific contracts committee team for their hard work in preparing for today's hearing. Senior Counsel Alex Polanoff was very excited about this hearing and unfortunately has a sick kid, so I know he's watching from home. We appreciate all your help, Alex, and our terrific committee counsel Jahari Fraser, who transferred with me here from GovOps, although we still have scale over there as well. Our policy analyst Alex Dublon, financial analyst Owen Kotowski, and the brains of our operation in Council District 33, my chief of staff, Molly Haley. I would now like to turn over to the committee council to administer the oath and thank the panelists for joining us today. Alright, we will now hear testimony from the administration. Before we begin, I will administer the affirmation. Panelists, please raise your right hand. Do you affirm to tell the truth, the whole truth, and nothing but the truth before this committee and to respond honestly to council member questions? Alright, we may begin when ready.