The city's Department of Education plans to award a contract worth as much as $2 billion to a tech firm that got caught up in a kickback scandal four years ago while doing the very same work being proposed.
The deal, set for vote by the Panel for Educational Policy Wednesday, would give Long Island-based Custom Computer Specialists $1.1 billion over five years for "IT networking and installation services," DOE documents say.
It includes options to extend the contract four years for $900 million more.
City investigators confirmed CCS was cited in their 2011 probe of a multimillion-dollar kickback scheme that led to the conviction of contractor Willard "Ross" Lanham on fraud and theft charges.
Watchdogs were furious.
"It's just an immense contract, and the idea that it should be given to a company that was involved in a kickback scheme just a few years ago is mind-boggling," said Leonie Haimson, director of the group Class Size Matters who first blogged about the contract.
CCS was a subcontractor that for years worked on Project Connect, a federally funded program to give public schools computers and high-speed Internet.
The 2011 probe found CCS "facilitated the concealment" of Lanham's profiting off the DOE and also of the employment of consultants at inflated wages.
In one case, CCS charged Verizon $247 per hour for a staffer whom Lanham paid $60 an hour, the report said.
Investigators also found Lanham insisted Verizon hire CCS as its subcontractor even though the telecom company's officials said they could do the work more cheaply without him.
"[The firm] benefited by Lanham's threat to Verizon that they would lose millions of dollars in business if they did not hire CCS," the 2011 report said.
After the probe, CCS was put on the city's vendor "caution list" for five years.
In August 2012, the firm submitted a corrective plan that included agreeing to report suspicions of wrongdoing to the city.
A call and e-mail to CCS went unanswered Monday.
DOE officials said that the contract is essential for schools and that it meets federal requirements.
They said CCS is partnering with Dell under a publicly bid contract that was renegotiated to $637.4 million for the first five years.
"This is a smart contract that will ensure smart classrooms," said DOE spokeswoman Devora Kaye.
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