Eureka Council Rejects Humboldt Made's Proposal, Moves Forward with Virginia Marketing Firm

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Meeting in closed session on the heels of recent revelations that staff had materially misrepresented the extent of issues with Humboldt Made’s proposal to provide marketing services for the city, the Eureka City Council voted this evening to direct the city manager to negotiate the $370,000 annual contract with the other finalist, Eddy Alexander, based in Virginia.

The closed session decision — which City Attorney Bob Black said was reached by general consensus — comes amid serious questions about the city’s request for proposals process that had led to staff’s recommendation to award the contract to Humboldt Made. On May 21, the city council went against that recommendation and instead voted to have both finalists interviewed by a new review panel appointed by the mayor that was to include at least one council member and marketing experts.

But that panel interview never took place as revelations about errors with Humboldt Made’s initial proposal — and how they were misrepresented to the public and the council — consumed the process. Black took on reviewing the issues and told the Journal he planned to report his findings to the council this evening, as well as applicable law, under a closed session agenda item listed as “significant exposure to litigation.”

"The legal standard that we're looking for is did it give one proposer a competitive advantage and, if so, the irregularity would not be considered a minor matter," Black told the Journal on Friday. "It would put it out of bounds for a waiver."

The city issued a request for proposals for the marketing contract back in February, severing decades-long ties with the Eureka-Humboldt Visitors Bureau, and set a proposal deadline of April 5. The RFP required interested firms to submit both print and digital copies of their proposals by the deadline, warning that submittals that weren't timely or complete "shall" be rejected.

Staff initially indicated that Humboldt Made submitted an incorrect draft of its print proposal and the correct draft of its digital proposal by the deadline, with the sole issue with the incorrect copy being a duplicate page that took the place of another page. Humboldt Made was allowed to resubmit the print proposal, staff said, on April 8, the next business day.

But after a Journal inquiry led to Black's review last week, the city's administrative staff found that Humboldt Made had not in fact submitted a correct digital copy of the proposal before the deadline and that corrections in the resubmitted print copies were far more extensive than staff had originally represented.

Because the contract in question is for more than $100,000 in city funds, the city's procurement policy states that the city council is the sole entity with the power to waive "irregularities" in the bid process. Tonight, the council voted not to waive the irregularities and thus to reject Humboldt Made's proposal. In a separate vote, the council then directed City Manager Greg Sparks to move forward with negotiating the contract with the other finalist, Eddy Alexander.

Both votes will come back before the council in open session on June 18 in the form of resolutions.

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