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Alderman/Distributor Stops Selling Products to Own Government

An alderman in Germantown, TN, has dropped his own suburban government as a client of his distributorship after local activists complained of a conflict of interest.

Germantown Alderman Rocky Janda, owner of distributor P.O.P. Solutions Group LLC (asi/359180), has sold more than $48,000 of athletic clothes, sports medals, banners and other promotional products to the government since he took office in December of 2012. Additionally, the alderman's company has sold products to the Germantown Performing Arts Center, a nonprofit entity subsidized by the government and run by city employees. The center bought a decorative display called a "donor wall" for about $8,000 and a smaller display for about $5,000 from P.O.P. Solutions Group, a multimillion dollar distributorship.

Janda argued that Germantown benefits from using his company as a vendor because he keeps prices low and donates his profits to city-supported organizations. “My opponents are trying to put me in a bad light,” Janda told Counselor. “I got legal permission to continue to sell to the city when I was elected and I donated to city-supported entities what little profits that I made on this very small amount of sales over the last four years.”

After The Commercial Appeal (a Memphis-based newspaper) reported on the business relationship last week, City Attorney David Harris recommended that Janda stop selling to the government. Sarah Wilkerson Freeman, one of two local residents who filed an open records request regarding P.O.P. Solutions Group’s business with the city, felt that Janda’s business dealings with the government damaged the public’s trust and prevented other vendors from getting a fair chance. "These [government] employees ... think 'Well, he's the alderman. I've got to buy his tumblers,'" Freeman told The Commercial Appeal.

Former City Attorney Tom Cates approved Janda continuing to do business with the city, The Commercial Appeal reported, as long as Janda followed standard purchasing rules. City Administrator Patrick Lawton told The Commercial Appeal that he also didn’t see a problem with the business relationship. Janda had sold promotional products to the government before he became alderman in 2012.

The Germantown purchasing ordinance states that any purchase between $4,000 and $10,000 is made on the open market and based on three competitive bids "whenever possible." The ordinance also states that any purchase less than $4,000 doesn't require public announcements or competitive bidding, though Lawton stated that the city typically competitively quoted purchases above $2,500. City records show that the large majority of the city's purchases from Janda's company were for less than $2,000.

According to emails found through an open records request, the city of Germantown paid P.O.P. Solutions Group $3,000 for towels in January 2015. The order was competitively bidded against HALO Branded Solutions (asi/356000) and Zebra Marketing, with P.O.P. coming in with the lowest bid by a small margin.

“This basically fits into the category that no good deed goes unpunished,” Janda told Counselor. The alderman said that he donates money to organizations like the Germantown Education Foundation and Germantown Community Theatre, and sometimes to the city itself. He said he also donates more than his annual $12,000 salary as a part-time alderman.

“I'm in more trouble with my wife than I am my citizens,” Janda said. “Once she found out that I had donated $40,504.33 (as of September 15th) to the city over the last four years (the profit part was less than $9,600 of this), she said ‘tell me again why I have the hand-me-down car.’”

Janda is seeking a second term as alderman in the November 8 municipal election.