OAKLAND -- A long-running dispute over who gets a $7.5 million Alameda County contract was finally resolved Tuesday, but not before an ugly public spat pitted Latino and African-American business leaders against one another.

After months of legal appeals and behind-the-scenes lobbying, the Board of Supervisors voted Tuesday to award the lucrative three-year contract for work to recruit temporary county employees and handle their payroll.

The county picked TeamPersona, a staffing agency owned by Walnut Creek businesswoman Ginny Velasquez. But two rival firms, both owned by African-American men, alleged that the process to select Velasquez was unfair and one said it violated California's affirmative action ban by giving preference to a Latina businesswoman over black men.

Velasquez and county administrators said the allegations had no merit. But moments after the supervisors voted 4-0 to approve her contract, rival bidder Clarence Hunt, owner of HR Management Inc., filed a $1.2 million government claim and promised a lawsuit that will "find the county guilty of race and gender discrimination."

Backing the black-owned firms at a contentious Tuesday meeting were prominent NAACP leaders and a former BART director, Lynette Sweet. Standing behind Velasquez were the Hispanic Chamber of Commerce and a diverse group of other supporters.

An exchange of sharp words and accusations -- including one speaker who referred to TeamPersona as "pirates" -- left county supervisors and many other people in the chambers visibly exasperated.


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"We're making it a race thing," said Oakland contractor Ken Houston, who had come to support Velasquez. "This is dividing us. How are we sitting here saying what we're saying? ... This is about qualifications. It's not about black, brown, Asian."

Velasquez's supporters, including the county administrators who recommended her firm, said TeamPersona won the bid over seven other firms simply because it scored highest on an evaluation that considers the bid price and other objective factors.

The dispute is the latest involving Alameda County's procurement process, which was twice criticized by a civil grand jury in 2011 and 2012 for lack of oversight in how contractors are chosen.

This is also the second personnel contract award that Hunt's firm has protested this year, bringing unusual attention to a process that rarely attracts public scrutiny.

For nearly eight years, Velasquez's firm shared the staffing contract with other firms, including Hunt's, but county administrators in January proposed giving all the work to a single contractor for efficiency and cost-saving reasons. The work involves recruiting and handling payroll for short-term employees, such as those who work for the Registrar of Voters during election season and others who substitute for permanent workers on maternity leave. Of the $7.5 million contract, about $5 million goes directly to paying the hired temp workers.

The two rival businesses, HR Management and Paradigm Staffing Solutions, lodged a protest letter on May 6. They sought to overturn the county's recommendation to give TeamPersona the entire contract and asked instead to split it up as it had been before.

The county's General Services Agency said in June that the claims were unfounded and denied the protest. Days later, the two firms appealed to the county auditor-controller's office, which denied the appeal on July 25.

Proposition 209 has for more than 15 years banned public agencies from considering race in hiring and contracting, but Alameda County does give preference to "small, local and emerging businesses," which includes many minority-owned and women-owned firms.

The rival firms, however, argued that TeamPersona should never have received extra points for being local because its Oakland address was a barely used "virtual office," not a real one. County officials countered that the Oakland office, while tiny, still qualified TeamPersona as a local firm. TeamPersona has since moved to a new Oakland office and the Hispanic Chamber of Commerce hosted an open house and wine tasting there on Nov. 21.

Supervisor Nate Miley abstained from voting on the contract Tuesday after his proposal to share the wealth among the competing firms was rejected. He also blamed the county's decision to select a sole bidder for "pitting two communities against one another."

Matt O'Brien covers Alameda County. Contact him at 510-208-6429 or Twitter.com/AlamedaCoNews.