BOSTON -- Two firms with long-standing ties to former Boston Mayor Raymond F. Flynn were dumped by the city Wednesday evening.

At an announcement at city hall, Mayor Thomas M. Menino said Evensen Dodge Inc. will replace Government Finance Associates Inc. as the city's financial adviser. In addition, Palmer & Dodge will replace Mintz, Levin, Cohn, Ferris, Glovsky & Popeo as the city's bond counsel.

The announcement came as a surprise to most city insiders, who expected the incumbent firms to have an edge in keeping their city business.

During Menino's election campaign, however, he pledged to award city bond contracts to qualified firms on the basis of the lowest bid. Since taking office, Menino has made that and several other changes in city government, including overseeing the city's first competitively offered bond issue earlier this year.

John C. Simmons, the city's chief financial officer, said yesterday that the city received six proposals for financial adviser and narrowed the group to three candidates: Evensen Dodge, Government Finance Associates, and Public Financial Management Inc.

"When we got down to the final three choices, we did our interviews and then opened up the bid amounts," Simmons said. "All three firms were very competitive and basically equal on experience and performance."

But the difference in prices between the three firms was significant. Evensen Dodge submitted a bid of $125,000 per year for the three-year contract; Public Financial's bid was $216,000 a year; and Government Finance's bid was $219,000 per year.

Government Finance was paid $244,000 a year on its last contract.

The bond counsel competition started with 15 firms vying for the work. The final selection was between Palmer & Dodge, the largest bond counsel firm in New England, and Mintz Levin.

Again, the contract's price helped Menino decide. Palmer & Dodge will be paid $175,000 a year. Mintz Levin's bid was for more than $200,000 a year.

Mintz Levin's previous contract cost Boston $400,000 a year.

"This decision is not intended to discredit our previous team in any way," said Robert Ciolek, the city's chief operating officer. "No one has ever suggested that both GFA and Mintz Levin have not done less than top-notch work and performed yeomen's service for the city."

Several sources said the presence of competitive bidding was responsible for the lower quoted costs of the contracts. The Boston Herald and the Boston Globe described Government Finance's previous contract with the city, for 1991 to 1993, as "no-bid," but in a prepared statement, company chairman J. Chester Johnson defended the competitive selection process governing the contract. Johnson had no other comment. Ciolek and Simmons both said that Government Finance, which served as the city's financial adviser since 1978, was reselected through a competitive process in 1991. There was only one other firm that responded to the request for proposal in 1991.

Simmons said Evensen Dodge, a new firm to Boston, clearly discounted its fees to get business for its new branch office.

"Obviously, we're thrilled about the selection," said Clark Rowell, a vice president in Evensen Dodge's Boston office. "The selection process was done in a very professional manner, and the people in the [Menino] Administration seem very well informed and diligent."

The city's next bond sale will comprise approximately $80 million of general obligation bonds in September.

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