MLGW’s Security Contract

On Sept. 16, 2015, a Security Services resolution for Contact #11794 was presented for approval to MLGW’s Board of Commissioners. This resolution awarded the contract to Dynamic Security Inc. for security services at MLGW. This contract was the result of a sealed bid process in which Dynamic Security emerged as the lowest bidder. Several employees of MaxSent, a competing bidder holding the current security contact, attended the MLGW Board meeting to voice concerns.

The City of Memphis once had a Living Wage Ordinance in place that affected requirements for external contracts. MLGW also had a Living Wage policy. In the spring of 2013, the Tennessee State Legislature passed an amendment explicitly prohibiting any local government or government agency from requiring a contracted private employer to pay employees an “hourly wage in excess of the minimum hourly wage required to be paid by such employer under applicable federal or state law.” (Tenn. Code Ann. § 50-2-112) Simply put, legally, MLGW is no longer allowed — as the City of Memphis is no longer allowed — to make employee wage a consideration in its contracts with private employers, except for minimum wage. Therefore, MLGW must — by state law — accept the lowest qualified bid. Dynamic Security’s bid was the lowest that met the legally allowed requirements for the contract. MaxSent placed the fourth lowest bid.

It is worth noting that MLGW is unable to confirm the projected Dynamic Security wage information presented by MaxSent employees, as the origin of that information is unknown. These numbers were not provided in the bid submitted by Dynamic Security, since proof of compliance with a living wage is no longer allowed by state law.

The contract up for approval by the Memphis City Council provides for adequate security staffing at all MLGW facilities, upholding the current standards of protection and surveillance. Failure to approve this budget item puts MLGW in danger of severe consequences. Our facilities, staff and city could become potential targets of vandalism, crime and/or even terrorism without adequate security measures. MLGW could also fall short of the North American Electric Reliability Council (NERC) security regulations, a federal violation which can carry fines in the millions of dollars.

MLGW acknowledges and understands the concerns regarding compensation for contracted security personnel. We have a deep appreciation for our guards and officers. We value the experience they bring to their positions and the vital service they provide each day. As with all our employees, we have tremendous incentive to keep well-qualified, experienced contractors who are invested in their work. Beyond that, we care for the wellbeing and success of all who serve MLGW and our customers.

The contract before City Council on Tuesday, Nov. 3, 2015, results from months of careful, diligent deliberation. Approving this contract is the only clear way to meet the immediate, urgent need to assure safety and security for MLGW, its customers and the City of Memphis.