Welfare isn’t the only social service bringing in the big bucks: Last week, the city Department of Homeless Services announced a whopping 22-year, $180 million contract for a new 400-bed shelter for adult homeless men in Bushwick. The winner: The Doe Fund, a major nonprofit that has stood out as one of the few to support the mayor’s policies on homelessness.

Unlike many homeless activists, Doe Fund founder George T. McDonald is conservative, trumpeting the importance of putting the homeless to work. During a heated exchange with an Urban Justice Center lawyer on the Fox News Channel talk show Hannity & Colmes last fall, McDonald defended his work-first philosophy this way: “[The homeless] don’t need people like you to fight for their rights,” he proclaimed. “What they need are people like you to fight for their right to work.”

McDonald also filed suit in 1997 against the Coalition for the Homeless, an advocacy group that has frequently needled the mayor. (The suit was subsequently dropped.)

As with many recent large contracts for social services, this contract was awarded via “negotiated acquisition,” a process that minimizes competition among potential vendors. The technique is now used much more loosely: in 1996, the city granted only 42 negotiated acquisition contracts, worth $164 million. By 1999, there were 208 awarded this way, and their value had jumped almost tenfold, to $1 billion.

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