Opinion ID: 1154635
Heading Depth: 1
Heading Rank: 8

Heading: Professional Services

Text: The City contends that the services which are the subject of the bid proposal were professional services which are exempted from the bid requirement under the City Public Bid Law found in Section 6-307(5) of the New Orleans Home Rule Charter. Rosenbush contends that they are administrative services which are fundamentally clerical and must be publicly bid. As noted previously, Section 6-307(5) of the 1954 Home Rule Charter of the City of New Orleans provides that services, other than professional services, are subject to public bid. A closely analogous case was presented in Council of City of New Orleans v. Morial, 390 So.2d 1361 (La.App. 4th Cir.1980), writ denied, 397 So.2d 804 (La.1981), in which members of the city council sought a declaratory judgment that a contract for administrative services for the city's employee health care plan was covered by the public bid laws. An argument was made that the services were professional services and thus exempt. The court found otherwise: If these services fall within the definition of professional services contemplated by the city charter, the contract forms an exception to the requirement of public bidding necessary for any other service contract. We refer to two previous cases of this court wherein we considered the application of contracts to the charter provisions. In New Orleans Transfer Company, Inc. v. City of New Orleans, 284 So.2d 362 (La.App. 4th Cir.1973) we reaffirmed the general rule relating to the interpretation of public bidding laws as set out in the case of Boxwell v. Department of Highways, 203 La. 760, [14] So.2d 627 (La.1943) that the public bidding laws were enacted in the interest of and for the protection of the tax paying citizens, and that open competitive bidding is a thing to be desired. In the case of Transportation Displays, Inc. v. City of New Orleans, 346 So.2d 359 (La.App. 4th Cir.1977) we held that the question as to whether competitive bidding by firms providing services is feasible and is contemplated by the public bidding laws must be determined by the terms of the contract. With these principles in mind, we have considered the evidence as to the nature of the services required to be performed under the contract requirements. It is apparent that the vast bulk of the services are basically clerical. Much may be performed by persons of high school education and above who have been trained in the various degrees of skill required for claims adjusting and for work of processing the various applications and applying certain rules and regulations leading to a decision to approve or deny claims. A considerable portion of the work is simply clerical in nature. At the same time, it is apparent that there are decisions that cannot be made by employees in the lower echelon who must consult with their superiors and supervisors to ascertain the proper result in questionable claims, or those claims to which the rules do not clearly apply. These supervisors are required to have a higher degree of skill and expertise in handling these claims. Superimposed upon this structure it is necessary to have at least one person of considerable skill and expertise to exercise the function of account executive. It is he who must oversee the formulation of regulations and coordinate the entire operation with the city's consultants and in accordance with its policies. It is also apparent that there are services to be performed in connection with this contract that can only be answered by professionals such as doctors, or on the insurance side by underwriters or actuaries. However, it is equally apparent that these services form only a small portion of the services contracted for and are usually obtained on a consulting basis in the case of a smaller, independent contractor as here, or furnished in house by other departments of a larger contractor such as insurance companies providing such services. 390 So.2d at 1364. An examination of the present bid proposal demonstrates that the services sought are primarily administrative or clerical. They include maintaining claim files, preparing reports, processing claims and making payments on claims. Many of the services will be performed under the direct supervision of or within the rules and regulations established by the City Attorney's Office. Serious policy-making decisions will be made by the City Attorney's Office. We further note that the services described in bid proposal FTC-# 2618 are virtually identical to those described in the four previous bid proposals, particularly FTC-#2324 which was awarded to Rosenbush in 1989. As the contract sought administrative services, instead of professional services, it was not exempt from public bidding under the provisions of the New Orleans Home Rule Charter.