Walsh Defends McChrystal's $1 Million No-Bid Contract: 'This Was Not The Normal Course Of Business'

At the end of the first week of March, Boston Mayor Marty Walsh began to realize that coronavirus was going to be a much bigger problem than he — and the city — were prepared for, and he was going to need help.

Walsh had had a conversation with Boston Federal Reserve President Eric Rosengren that was supposed to be about the economy but wound up being all about coronavirus. They didn’t shake hands; they sat 6 feet apart. On Friday March 6, Walsh called Jeffrey Leiden, the CEO of Boston-based Vertex Pharmaceuticals, who “played the worst case scenario” for the mayor: “Shut everything down. Shut the schools down, colleges down. You know — work from home.”

Over the next few days, Walsh would announce the cancellation of the annual St. Patrick's Day parade, and the closing of Boston Public Schools. “We literally had to go into lockdown mode,” Walsh said, and he started looking for “someone who could help us oversee operations … because this was not the normal course of business.”

In an interview with the WGBH News Center for Investigative Reporting, Walsh explained how the City of Boston came to spend $1 million on a no-bid contract with the consulting firm created by Gen. Stanley McChrystal, the former head of U.S. military operations in Afghanistan, to bring a military mindset to the city’s coronavirus response.

Walsh publicly announced the contract at the end of March, but until now the city has never provided much detail about what the Alexandria, Va.-based McChrystal Group was hired to do.

And by some measures, they were an odd choice to help out in a pandemic.

For starters, they were not public health experts. Contract documents obtained by the WGBH News list eight McChrystal Group personnel who would participate in the contract, including a former Marine explosive ordnance disposal expert; a former Army Airborne Corps commander; and a former deputy director of operations at the CIA. None of them claimed direct experience with FEMA or state emergency management agencies.

And the contract prospectus had virtually no details about what they would produce. For $229,000 per month, the McChrystal Group was offering only three deliverables: Advising on integration of interagency plans; advising on operation of an integrated response center; and establishing “a disciplined cadence of information flow and activities” to drive the city’s response.

It is common for cities and states to hire outside contractors to help plan for and manage disasters, said Kurt Schwartz, who ran the Massachusetts Emergency Management Agency from 2010 until 2019. MEMA had several such contracts during his tenure as director. But the McChrystal Group “certainly was not a firm that was in the emergency management space that I was in. It was not seeking contracts that MEMA was putting out.”

Schwartz said a group like McChrystal’s expertise appears to be in leadership, not government policy. “The military background can be and may be helpful to the city in sort of providing management guidance, crisis leadership,” Schwartz said, particularly if the city has an array of separate agencies providing the technical expertise.

But “if the city's objective was to really get down and start helping guide tactical operations and drive policy in the COVID arena, then you certainly want a firm that has the right people and the right experience,” Schwartz said.

But Walsh says COVID policy was never the point. “McChrystal Group didn’t tell me anything about the virus,” he told WGBH News. “We were depending on our public health department … and we were tied into a whole bunch of different experts and doctors about the virus itself.” The McChrystal Group was “helping us coordinate a response to the operational side of the city," Walsh said. “How do we get all these different moving pieces and still operate a city even while we — still — don't have people in the building?”

Walsh said the McChrystal team set up a structure for the city to coordinate and communicate among decision-makers.

“We created what was called a ‘crisis response forum,’” Walsh explained. “As soon as McChrystal came in, we had a crisis response forum where the leadership — most leadership — and supports of the city were on that call.” The purpose of the daily call was “recapping the previous 24 hours, planning the next 24 hours — every morning for months, seven days a week. We had a call, eight o'clock, never missed.”

When Boston needed technical assistance, it hired technical expertise, not the McChrystal Group. In June, the city awarded a year-long, competitively bid contract for $750,000 to a North Carolina company to develop technical reopening guidance for a wide range of city businesses and government agencies.

Walsh said he couldn’t have competitively bid the McChrystal contract. “We didn't have 30, 60 days to put a contract out,” he told said. “This isn't the typical no-bid contract. This is where we had literally ten days before coronavirus just exploded all over.”

Boston has faced criticism for failing to meaningfully include minority-owned businesses in contracting generally, and in coronavirus-related emergency contracts in particular. As of mid-June, Boston had awarded $12 million worth of emergency COVID-related contracts, but only one Boston-based minority-owned company won a portion of this business, totallting about $225,000. However, a Medford-based minority-owned company did get the contract for more than $5 million in computer equipment for the city’s school students.

The McChrystal group offered a team that was all white men.

“With the demographics of the city, as well as the disproportionate burden of COVID-19 on people of color, particularly Black people and Latinx people in Boston, it presents a particularly misaligned approach considering the city's commitment to equity,” said Atiya Martin, who previously served as chief resilience officer under Walsh and director of the Office of Public Health Preparedness at the Boston Public Health Commission.

Walsh says he understands this concern and he points out the city has taken a number of steps to address equity in the city’s response to the coronavirus, including creating a health equities task force and establishing the Resiliency Fund that is channeling millions of philanthropic dollars into minority non-profits.

“I think moving forward here in the city on any contracts we're doing or any type of consulting thing we're doing . . . the sense of urgency [for diversity] is even greater today than it was five months ago, six months ago, a year ago,” Walsh said. But still “Knowing what I know now — then — I’d probably still bring on an expert like the McChrystal group.”

In the end, the city may not have to foot the bill for the McChrystal Group contract. The contract will wind down at the end of the month and the city expects to be reimbursed by FEMA for those costs along with other disaster-related expenses. The company did not respond to emails and phone calls requesting comment for this story.

Update: After this story was published, the mayor’s office clarified that there were some women on the McChrystal team that worked with the city.