Unmasking state’s shady contracts
The coronavirus pandemic forced California to venture into a strange new market for masks, an enterprise it undertook with all the grace and deliberation of a popup Halloween store. Gov. Gavin Newsom’s wellmeaning global hunt for medicalgrade masks and other protective gear has drawn justified criticism in the Legislature and come perilously close to frittering away hundreds of millions of taxpayer dollars on phantom goods. It’s been a testament to the value of government transparency even amid crisis as well as the price of delegating a national crisis to state and local governments.
The governor’s latest budget asks the Legislature to give him free rein to spend almost $3 billion more on protective equipment and other emergency pandemic needs, which led state Sen. Holly Mitchell, DLos Angeles, to urge the administration to recognize “the role the Legislature must play” in such decisions. The nonpartisan Legislative Analyst’s Office rightly warned lawmakers to protect their power over spending, noting, “In many cases, we are very troubled by the degree of authority that the administration is requesting that the Legislature delegate.”
That wariness is wellearned. After Newsom took to Rachel Maddow’s MSNBC show last month to announce a deal with the Chinese electriccar maker BYD for hundreds of millions of N95 and surgical masks, he refused to disclose the billiondollar contract to lawmakers or the public for about a month. The company has yet to deliver the bulk of the masks because the federal government has not certified them. The delay means it owes the state a refund worth about a quarter of the contract’s price, half of which the state delivered upfront.
Some of California’s other adventures in protective equipment procurement didn’t even go that well. An $800 million deal for masks and face shields with a company headed by a former Alabama attorney general fell apart after most of the equipment failed to materialize, the Los Angeles Times reported, though officials say they didn’t pay for any of the missing supplies. The state did send more than $450 million to another politically connected company promising N95 masks, CalMatters reported, only to frantically retrieve the money hours later. Now that company, Blue Flame Medical, is reportedly under federal investigation.
California wasn’t alone in this. Maryland had an abortive contract, albeit for much less, with the same company, and an Illinois official recounted rushing a $3 million check to a mask vendor for a dodgy exchange in a
McDonald’s parking lot. States, cities and hospitals are competing for masks in an international market that the Washington Post recently described as rife with fraud and pricegouging.
With most of the Bay Area and the United States still experiencing shortages of vital protective equipment for health care workers, the Newsom administration’s urgency was more justifiable than its methods. But the circumstances call for more rather than less pubic and legislative scrutiny to avoid squandering the state’s scarce resources in the inevitable confusion.
The fundamental failure here is the lack of a national strategy to procure, manufacture and distribute masks while preventing counterproductive competition among the states. Although California is better equipped for that competition than its counterparts, its missteps spring partly from a scramble to fill a federal leadership vacuum.