Judge to rule soon on unbid Ala. computer contract

AP News
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Posted: Dec 17, 2009 3:21 PM

A judge said Thursday he will rule soon on Alabama Gov. Bob Riley's request to throw out a lawsuit filed by Democratic legislators challenging an unbid computer contract signed by the Republican governor.

Jefferson County Circuit Judge Tom King heard nearly an hour of arguments Thursday morning about the lawsuit filed by members of the Legislature's Contract Review Committee. They are challenging a $6 million extension of a contract with Paragon Source to modernize the state's financial records management system.

Paragon Source has done computer work for the state for several years, but legislators questioned why it got the extension on top of an initial $7 million contract even though it has no business phone listing or Web site.

The governor's attorney, Kevin Newsom of Birmingham, argued that the committee has no legal standing to sue over the contract with Paragon Source.

He said state law gives the committee the legal authority to review contracts, but not stop them. He said the committee filed its suit a week after Riley signed the contract, and that makes the suit moot.

"What they are trying to do is get in the courthouse what they can't get at the statehouse," Newsom said.

The committee's attorney, Tyrone Means of Montgomery, said the administration gave the contract to Paragon Source without contacting any other companies and the contract should have been put out for bids.

"We don't believe the governor can approve a contract that was void under the law," Means told the judge.

King, a Democrat who has been on the bench since 2001, said he will issue a ruling on the dismissal request before the next hearing in the case is scheduled Jan. 7.

Paragon Source has become the focal point of a political fight between the Republican governor and Democratic legislators over unbid contracts.

Riley officials say the company had performed well and the initial work needed to be contracted quickly because of a short deadline. The company's president, Janet Lauderdale, has said it hasn't needed a Web site or phone listing because it already is known to the clients it serves.

State law allows government officials to issue contracts to a company without taking bids if state officials determine the company is the "sole source" that can provide the service or product. Means said an undated letter describing Paragon as the "sole source" was not provided to the committee until Dec. 3 and that its wording indicated it wasn't written until after Paragon's contract became a political issue.