"No-bid extensions mostly eliminated at Hartsfield"

Saturday, May 22, 2004

No-bid extensions mostly eliminated at airport
Hartsfield-Jackson contracts brought up to date
By KIRSTEN TAGAMI
The Atlanta (GA) Journal-Constitution


Atlanta City Council member Felicia Moore got an earful recently about
Hartsfield-Jackson International Airport as she waited to catch a
flight.

Two businessmen she didn't know sat next to her at the city-owned
airport, talking about the airport's shops and restaurants and "how you
can't do business at the airport unless you know the right people, how
crooked the system was and how many palms you have to grease to get
contracts out there," she said.

Moore, chairwoman of the council's Transportation Committee, wanted to
defend her city but thought better of it.

"That perception is out there for some very good reasons," she said.
"It's going to take some time before people think they have a fair
chance to get airport contracts."

Two years after Mayor Shirley Franklin promised to clean up city
contracts, including the airport's, officials say they have made great
progress. Many contracts have been rebid or renegotiated, bringing
millions more in revenue to the airport.

But two high-profile contracts were awarded to politically connected
people - including Franklin's ex-husband and son - who have been doing
business at the airport for years, raising questions about just how much
the system has changed. Those contracts - for the airport's indoor
advertising and the duty-free shop - have landed the city in court,
after losing bidders lost administrative appeals and sued.

When Franklin took office there were more than two dozen long-expired
airport contracts, some of which had been extended without bid to
friends and political supporters of former mayors Bill Campbell and
Maynard Jackson. Some contracts had been expired for more than 20 years.
At the time, airport General Manager Ben DeCosta said long-term
extensions were "a pattern and practice in the city for a generation."

DeCosta last week said all but five of those contracts have been
updated. In the case of airport advertising, DeCosta is waiting for an
opinion from the city's Law Department on whether he can ask the City
Council to approve his selection even though the case is tied up in
court.

The losing bidder, Atlanta-based Corey Airport Services, protested the
selection of a team that included Barbara Fouch, a close friend of the
late former Mayor Jackson. Corey said Fouch, an African-American woman,
should be disqualified as a disadvantaged business enterprise because
she is wealthy.

The contract for the duty-free store on the international concourse also
is in court. In that case, DeCosta overruled an evaluation panel to give
the contract to a team that included a company run by Franklin's former
husband, which employs her son as a vice president and a daughter as a
human resources specialist.

Worried about suit

DeCosta said he was concerned about a bondholder lawsuit against the
other bidders, who also have ties to City Hall. That team's minority
partner included a company co-owned by a daughter of Maynard Jackson. No
other companies bid.

If the court decides DeCosta's selection was correct, the city will reap
$140,000 more a month than under the current contract, which now belongs
to HMSHost. That company, which had the contract on a month-to-month
basis since its contract expired in 1999, chose not to bid again to
operate the shop, which sells luxury goods to international travelers.

Besides those, three others are being bid or renegotiated, DeCosta said.

They are:

   . Operations and maintenance for the airport's underground people
mover. DeCosta said he is trying to reach a new agreement with
Bombardier. The Canadian company had an $8 million, two-year contract
that expired in 2000, with no evidence of any legal renewals since then.

   . Base operations for small general aviation aircraft. DeCosta said
his staff is preparing bid documents for this contract, which generates
a variable amount of revenue for the city. Mercury Air Group's contract
expired in 2002 with no record of renewal.

   . Pay phones. DeCosta said his department is preparing bid documents
for this contract, which he called "small potatoes," adding, "When was
the last time you saw a line at a pay phone at the airport?" The
contract, awarded in 1994 to AT&T, Kellee Communications and Peoples
Telephone Co., expired in 1999 and has continued month to month since
then.

Some expired contracts that had been held by friends and supporters of
former mayors have gone to new companies. A contract to stock airport
vending machines that had been held by the wife of a poker buddy of
former Mayor Campbell was rebid and awarded last year to Atlanta
Coca-Cola Bottling Co.

DeCosta and the city's chief of procurement, Adam Smith, say they have
worked to try to erase the Atlanta airport's reputation as primarily a
place for a few politically connected contractors to make a fortune.

That includes greater outreach to companies that haven't bid in the
past, Smith said.

"We can't just continue to rely on simple solicitations," Smith said.
"We have to call folks and encourage them to bid on the contract."

And DeCosta said he's prepared to start over in cases where there are
too few bidders.

He said that in the case of one airport runway construction contract
that received a single bid last year, he decided to go back to square
one, redo the bid documents and ask other qualified companies to bid. As
a result, a company that hadn't done business at Hartsfield-Jackson in
years, Gilbert Southern Corp., bid and won the runway work, he said.

The city holds information sessions for potential bidders. About 600
people showed up at the most recent event, DeCosta said.

Tightened oversight

As for the past practice of letting contracts expire, Smith said the
city has put into place several systems to make it less likely they
would slip between the cracks or be quietly renewed to favor an existing
bidder.

New computer software prompts staff when a contract comes due, and there
are biweekly meetings between departments and a 90-day look-ahead
report.

For council members, who must approve all airport contracts, some
nagging issues remain, however.

Franklin has said she doesn't get involved in any contracts involving
her ex-husband's and children's company. But at a recent Transportation
Committee meeting, members grilled city lawyers about how Franklin truly
can avoid being involved.

"She's involved by designating someone," said committee Chairwoman
Moore, who asked the lawyers for a written report on what happens when
the mayor recuses herself.

Looking back on the two years' worth of work on contracting, Franklin
said airport contracting has improved, although not all contracts have
been resolved as quickly as she would have liked.

"Those that are appealed or those where the bidders don't meet the
minimum qualifications can't be resolved, no matter how much we'd like
them to be," she said. "The most important thing is that we identified a
process to get them resolved."


 Do you have an opinion about this story?
Share it with other readers in our CAA Discussion Forums

http://www.californiaaviation.org/dcfp/dcboard.php


*****************************************