"Miami Airport Luggage-Wrapping Company Gets Around Security Policy"

Tuesday, September 2, 2003

Miami Airport Luggage-Wrapping Company Gets Around Security Policy
The Miami (FL) Herald


A luggage-wrap company that survived a political slugfest over its Miami
International Airport concession two years ago is on the verge of triumphing
over a new challenge -- this time from federal homeland security
regulations.

Responding to lobbying by the company, the Transportation Security
Administration told MIA last week that Secure Wrap will be able to continue
encasing bags in plastic, despite its policy that all luggage must be
unlocked and accessible to inspectors.

Secure Wrap will present a plan to MIA for it to place employees on the far
side of the screening area so they can re-wrap any bag TSA inspectors have
to rip open. MIA will incorporate the proposal in its airport security plan.

The employees must have a 10-year background check before they are allowed
in the "sterile area." And the airport agrees to assume the liability for
any problems that result from their presence.

That solution, intended to be a national model should other airports
contract with a baggage-wrap vendor, brings to a close more than a year of
conflict that spread to Washington.

It's not the company's first encounter with controversy: The three-year,
36-lobbyist tussle for the contract Secure Wrap won became a case study in
how county politics can disrupt airport business decisions.

Its new struggle over security regulations demonstrates how politics,
business and bureaucracy are influencing society's evolving response to
terrorism.

"The ultimate question we're continuously dealing with is: How do we
increase security to the maximum extent possible while making sure that the
economy is not asphyxiated?" said U.S. Rep. Lincoln Diaz-Balart, R-Miami,
one of several politicians who intervened on Secure Wrap's behalf in
Washington.

That issue arose almost immediately after Secure Wrap began working its
contract.

The company's battle for the exclusive MIA concession finally ended in
August 2001, when a state judge threw out a challenge to a Miami-Dade County
Commission vote overriding Mayor Alex Penelas' veto of its winning bid.

Co-owners Enrique "Henry" Ramos and Radames "Michi" Villalon said that after
taking over all MIA baggage wrapping operations on Aug. 22, 2001, they
enjoyed 20 days of fantastic business. They thought they would earn $1
million more than their projected first-year revenue and began fast-tracking
expansion plans.

But the 21st day was Sept. 11, 2001, the day of the terror attacks.

In the short-term aftermath, the company had to deal with reduced sales
because fewer people were flying. Its revenue dropped from $19,000 a day to
less than half that.

Worse, inspectors increasingly were ripping off the plastic to open bags or
swab them for explosives residue.

Angry customers got refunds if they had time to demand one. Company
executives believed the very existence of the business was in peril.

>From the beginning, MIA director Angela Gittens supported the company.
Concession fees gave the airport at least $1.5 million a year and the
service reduced theft from checked bags, a big problem for Latin American
passengers taking consumer goods home.

In the new security-conscious climate, Gittens said, the service offers
another advantage -- it prevents someone from introducing a bomb into
luggage. It made no sense for one element of security to push out another,
she said.

One obvious solution was to allow Secure Wrap to put machines on the far
side of security in order to re-wrap those that inspectors opened. But TSA
rules said only airlines were allowed to touch bags that had already been
inspected.

"TSA's charge is to try to do the same thing at all airports and its
procedures didn't contemplate this service, which doesn't occur at many
airports," Gittens said. "They just didn't have the time or mental resources
to deal with an outlying situation." At MIA, the new agency was run by
former Federal Security Director Ed Guevara, who resigned last month.

He did not respond to several requests for interviews. A TSA spokeswoman
could make only a general comment on the goal of making airports safe.

But MIA and Secure Wrap officials agree that Guevara resisted the idea of
keeping Secure Wrap in business.

He rejected two sets of letters Secure Wrap obtained from 25 airlines naming
it as an agent in order to be allowed to touch screened bags.

Moreover, he objected to putting the machines close to the far side of
security during trial runs because he did not want it to look as if the TSA
endorsed the product, those involved in the process say.

The repeated problems and delays hammered at Secure Wrap's financial
existence -- especially once a deadline was passed to begin inspecting every
bag this past January and sales dropped even lower.

Underlying the bureaucratic tension, it became clear that Ramos and Guevara
did not get along.

Ramos said he confronted Guevara about his attitude at their very first
meeting after Guevara told him he wasn't there to do venders' homework for
them about how they could get Washington to help solve the regulatory
problem.

"I pulled him aside and let him have it," Ramos admits.

He also said Guevara had him thrown out of another meeting.

In numerous e-mails between Ramos and airport officials obtained by The
Herald, Ramos also complained that Guevara was "lobbying" the airlines not
to deal with Secure Wrap, emphasizing that they would face a fine of $25,000
per bag if there were any violations.

Meanwhile, however, Secure Wrap was doing lobbying of its own in Washington,
bypassing the local TSA authorities.

"When Congress got involved, they started jumping," Ramos said.

It hired Washington lobbyist J.C. Boggs and began contacting key lawmakers,
such as U.S. Rep. John Mica, R-Fla., chairman of the House aviation
subcommittee, and U.S. Rep. Don Young, R-Alaska, chairman of Transportation
and Infrastructure and member of the Homeland Security Committee.

Members of South Florida's delegation also got involved, said D.C.-based
Secure Wrap spokesman Hector Gonzalez.

'They started to intercede on our behalf, sending letters saying 'why is
this not being considered?' " Gonzalez said.

It took several rounds of pressure from Washington to resolve the issue.

On Jan. 8, TSA Deputy Under Secretary of Security for Aviation Operations
Mike Robinson sent an e-mail to Ramos and Gittens saying "I have instructed
[Guevara] to work on a solution that will allow you to continue to operate
within our security plan." But in February 2003, Diaz-Balart set up a
meeting with Admiral James Loy, TSA Administrator, because nothing had
changed in Miami.

According to a follow-up letter he sent to the TSA, U.S. Reps. Mario
Diaz-Balart and Ileana Ros-Lehtinen, both R-Fla., also attended.

Those talks finally produced a test in June to make sure the plastic wrap
did not interfere with X-ray machines. The federal bureaucracy began working
on who could take responsibility for the company and where to put its
machines.

Finally, last week, TSA told MIA that it could assume responsibility for
regulating Secure Wrap as long as it wrote the company into its security
plan. There was no need for airlines to make it their agent.

Villalon said 36 Secure Wrap stations will soon be operating, up from the 15
now open.

Ramos said he respects the TSA and understands the difficulties of being a
new agency. Nevertheless, he said, his next task may be a lawsuit against
the government to recover profits lost in the meantime.

Secure Wrap laid off dozens of employees, fell behind on its guaranteed
payments to the airport, and sold properties to survive in the past two
years.

"We are going to sit down with the airport and the TSA and visit the
monetary issue," he said.


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