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Monday, November 15, 2010

Cleveland’s LED Lighting Deal Continues to be Problematic

Posted By on Mon, Nov 15, 2010 at 9:27 AM

This is the lighting scheme Jackson wanted for his office.
  • This is the lighting scheme Jackson wanted for his office.

Interesting read this weekend in the Plain Dealer updating the LED lighting kerfuffle that shook the Jackson administration early this summer. The recap: In March Jackson announced a big juicy valentine of a deal with Sunpu-Opto Semiconductors, a Chinese LED manufacturer. The fine print gave the company an exclusive option to provide Cleveland with light fixtures; in exchange, the company said it would open its U.S. headquarters within city limits and provide 350 local jobs.

Some council members and local business owners —chiefly, G.E. — cried foul, saying the buddy-buddy contract violated the city’s bidding process. After some huffs and puffs, Jackson uncharacteristically back-peddled, chucking the deal and opening the bid to everyone.

According to this weekend’s update
, Sunpu-Opto’s stateside rep, Peter Tien, says the city’s RFP is a pipe-dream.

But it's not likely that Sunpu-Opto will submit a bid given the specifications, Tien said. Under the terms of the original deal, the company was willing to break even selling LEDs to the city for the opportunity to establish its first U.S. manufacturing base here. But the price structure in the city's bid specifications would likely mean the company would lose money if it had to assemble the LEDs in the U.S., Tien said.

GE Lighting officials said they are preparing a bid, but declined to say whether the company would be willing to build a manufacturing plant in Cleveland. GE Lighting is headquartered in East Cleveland.

Representatives from several other companies said the city's bid specifications were untenable

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