Motorola received the $50 million as part of a $18 billion federal stimulus grant which went to 37 states. Now, serious questions are being raised about the way Motorola was selected. Questions of ethics, conflict of interest and transparency.
The new broadband network system would help first responders talk to each other on the same radio band during major disasters and terrorist attacks. That is a big achievement for police and fire who work with a hodgepodge of different radio frequencies.
In August, the federal government awarded the $50 million grant to the Bay Area to launch the cutting-edge communications system.
The agency administering the project is called UASI -- the Bay Area Urban Area Security Initiative. It's a joint partnership among Bay Area governments and public safety agencies.
UASI selected Motorola to build the new system. The company in turn received the $50 million.
San Jose Mayor Chuck Reed questions the decision. Santa Clara County executive Jeff Smith also has serious concerns about the grant award to Motorola.
"It looks like the process was structured in such a way to prevent open competition and transparency," Smith said.
Both San Jose and Santa Clara County are on the governing board of UASI.
Reed and Smith sent a letter to U.S. Commerce Secretary Gary Locke, asking that the grant be suspended or postponed until they can find out if there was an open bidding process.
They are also suspicious of UASI's Executive Director Laura Phillips. She was once a Motorola executive. At least three of UASI's key staff members are also from Motorola.
Smith says the selection process smacks of conflict of interest.
"It was run entirely by Laura and her staff; it was never approved, the results were never approved by the approval authority," Smith said.
Phillips declined to speak to ABC7 on camera, but in a written response Phillips said she has "never recommended Motorola during a procurement process, nor participated in a process involving a bid from Motorola, nor negotiated a contract for services with Motorola."
Reed and Smith have asked the California Emergency Management Agency to investigate. In the meantime, they have filed a freedom of information request to obtain Motorola's bidding documents since they say the company refuses to hand them over.
Motorola declined to comment on the dispute.