The city of Bellingham, Wash., is launching an investigation into how one of its employees used ChatGPT to help award a large city contract. That's after records uncovered by KNKX and Cascade PBS show the employee asked the chat bot for help tipping the scales to ensure a preferred vendor was selected.
KNKX Murrow News fellow Nate Sanford joined host Phineas Pope to discuss.
Phineas Pope: Tell us about this contract, and how a city employee used ChatGPT to word it.
Nate Sanford: This was early last year, and the city of Bellingham needed to find a new vendor to replace its utility billing software.
It’s kind of a complicated software — it handles customer payments and all those things. Basically, the city employee was tasked with putting together an RFP, request for proposals, which is kind of a standard step in local government where you put out this request for different companies to apply for the contract.
Shortly after this, I filed a pretty large records request for just general examples of government employees using chatGPT, and got thousands and thousands of pages back.
This was one that stood out to me, because while they were in the process of writing this RFP, there were a few messages that kind of raised a red flag. In one of them, they asked ChatGPT to tailor a contract requirement in a way that would “exclude” this one specific company from the contract without explicitly saying so. There was another message where they asked ChatGPT to write contract requirements that would “favor” this different specific company.
The city ultimately awarded the contract to the company that the staffer had asked ChatGPT for help sort of tipping the scales towards. And we can't really say for certain the extent to which that AI generated language was the deciding factor in which company got the contract. But cities have to follow a pretty strict set of rules when it comes to procurement for fairness and neutrality. And this would seem to raise some concerns about that.
Pope: Was there any evidence that this staff member had a financial motivation to pick one company over the other?
Sanford: There isn't any evidence to suggest that. Sometimes in cases involving procurement issues, you see kickbacks or things like that. There's no evidence to suggest that.
In one draft email that we obtained, the staff member wrote to a colleague that basically they believed they'd already found the best vendor through research, and felt that going through this competitive bidding process would be kind of redundant. It would be an extra hoop to jump through.
Pope: What's the status of the city of Bellingham’s investigation into this case?
Sanford: The city said that they were launching an investigation shortly after I reached out for a comment last month. And they say they're expecting it to be finished in early 2026. Because of the nature of it, just with city investigation, personnel issues, they can't really say much about the incident itself.
But the mayor said that she feels like the city is taking this seriously. There's still a lot of context about what happened that they feel like they don't have, so they just need to learn more and do more fact finding. The mayor said … that they do train staff on how to do procurement, and they've stressed that neutrality and fairness are all really important aspects of that.
Pope: What about the city of Bellingham? Do they have policies or guardrails in place to prevent something like this from happening?
Sanford: The city sent me a big batch of documents that had their training materials and their policies for procurement and competitive bidding. A lot of their policies are pretty similar to the policies at the state level that cities are required to follow.
The material is pretty thorough and it makes it pretty clear that staff are expected to approach procurement from a neutral perspective. The city's guidance on RFPs says that treating bidders fairly and equally is one of the most important elements of the evaluation process.
Pope: You did some reporting last year that shows how common it's becoming for local governments to use ChatGPT and other AI tools for day-to-day work. What questions are you left with after this investigation?
Sanford: I talked to one legal expert who said that it's not unheard of for people to subtly write bid requirements in a way that favors a specific vendor. That's happened in the past and it's a known issue. But this is the first time that he's aware of someone who's potentially used AI for help with that. This is almost a case where it's like an old problem that's maybe being enabled or made easier with this new technology.
And if it wasn't for public records, this probably wouldn't have been possible to detect, which I think is really interesting. It's also really interesting that when the staffer was asking ChatGPT to generate this language that would favor this one company and exclude another company, ChatGPT didn't object to the request or question why a government employee was asking for this throughout the entire conversation.
Instead, ChatGPT asked what else it could do to help and provided a pretty long list of suggestions for how to make this easier, which I think also raises questions about the guardrails and the extent to which this technology can be used for things that may cross a line.
Nate Sanford is a Murrow fellow for KNKX in partnership with Cascade PBS.
Note: This transcript has been edited for clarity.
