CHA Board approves contract awards for Property Management Services

CHICAGO (May 20, 2020) – The Chicago Housing Authority (CHA) Board of Commissioners Tuesday approved contracts for private property management (PPM) services at CHA properties following an improved procurement process based in part on recommendations after a review of CHA’s 2015 PPM process.

Under the new contracts, The Habitat Company, Inc., will manage a combination of senior and other properties where CHA maintains units, and Manage Chicago Inc., will manage properties in CHA’s Scattered Sites South Region.

The contract awards followed a competitive bidding process after CHA issued a Request for Proposals (RFP) for PPM services in late 2019. The awards approved are for a three-year base term from July 1, 2020 through June 30, 2023 with two one-year options for a total contract amount not to exceed $19,280,568 CHA is expected to realize a projected annual savings of $790,000 with these contracts.

One of the goals of this improved procurement process was to attract management companies that would deliver best practices and services to support CHA’s goal of providing safe, quality housing for residents in professionally managed and well- maintained units and buildings.

While The Habitat Company is an established and experienced management entity that currently serves as a property manager for CHA, Manage Chicago is new to CHA and brings a depth of experience in managing rental housing portfolios. Habitat’s contract award totals $10,690,780 for the three-year base term. Manage Chicago’s contract award totals $575,088 for the three- year base term.

CHA’s Board Tuesday also released the findings of the review by global consulting firm Crowe LLP that conducted a comprehensive examination of the contracting process in 2015.

CHA engaged Crowe LLP to conduct a thorough review of its procurement process for the 2015 property management services contract and outlined a number of recommendations for CHA that would strengthen the procurement process. CHA accepted the recommendations, all of which provided sound guidance that have helped CHA create an improved procurement process and roadmap that will guide policies, procedures and solicitations, including:

• Implementing a quarterly vendor performance review and score card that will be utilized as part of the past performance metric for the evaluation teams, beginning Q2 2020.
• Performing internal audits of all existing property management firms as part of CHA’s 2019 Internal Audit Plan and reviewing a transition plan for new vendors awarded contracts in 2020.
• Creating a formal process to select qualified members of procurement evaluation committees to ensure committee members have the relevant technical knowledge of the scope of services to be performed for CHA.
• Looking at other financial risks for respondents (i.e. debt, liens). Follow-up analysis will be performed annually for any “At Risk” vendors.
• Examining all quarterly and annual payroll tax filings to verify payroll tax payments are being made as required by CHA vendors.
• Strengthening internal controls to examine monthly financial packages submitted by vendors and follow-up on any missing information. Documenting all instances of missing information and consider within the overall performance assessment of the vendor.

The review noted that CHA had the necessary procurement policies and processes in place to support a robust procurement process but in certain areas, enhancements were needed to ensure that all processes were properly followed.

“CHA is committed to transparency in all its operations and strives to identify ways to improve policies and procedures to ensure that its procurement process is managed at all stages with

the utmost integrity,” said CHA CEO Tracey Scott. “We accepted the recommendations made by Crowe in its review and relied on them for guidance to strengthen CHA’s procurement process to ensure resources are allocated in the most responsible way possible with the best outcomes for these vital services that impact our residents.”

CHA plans to issue a second RFP for additional PPM services for other CHA properties in the coming months. CHA relies on private property managers for a variety of matters, from rent collection to building operations and maintenance that ensure the upkeep of the properties and grounds, and continued regular communication with residents