Port Reopens Its Search for Firm to Run Parking Lot : Services: The current operator accuses the Harbor Commission of bad faith over the way it handled a competition for the five-year contract worth about $2 million.
The Los Angeles Harbor Commission has reopened its search for a parking lot operator for the World Cruise Center after an unsuccessful bidder charged that a recent competition was a “mockery” that could cost the port $1 million in lost revenues.
The commission’s decision last Wednesday to postpone selecting a parking operator follows weeks of wrangling over a five-year contract that is worth an estimated $2 million.
The decision also follows the port’s acknowledgement that a recent competition among six companies was muddled by Harbor Department documents that implied the parking concession would be awarded under the strict rules of competitive bidding--a misstep that led the lot’s current operator, Five Star Parking, to angrily accuse the port of bad faith.
“In the many years Five Star Parking has been involved with public agencies throughout the country . . . we have never encountered such a procedural injustice and lack of ‘good faith,’ ” Five Star’s Seymour Wolk told commissioners in a Dec. 10 letter.
The dispute over the contract began in early November when Five Star and the other parking lot operators learned that the Harbor Department’s staff had recommended the concession go to AMPCO Auto Parks Inc., whose other contracts include John Wayne Airport and the Los Angeles County Department of Beaches and Harbors.
Although acknowledging that other firms would pay a larger share of receipts to the port, the harbor staff recommended that AMPCO get the contract because it promised better service with, among other things, more employees to operate and maintain the lot, which has parking for 3,162 vehicles and annual gross revenues of nearly $2 million.
But that recommendation stalled when it came before the commission Nov. 28 because competing companies argued that the port’s staff had significantly downplayed the potential loss of revenue.
Gil Barnett of Parking Concepts Inc. told the commission that his proposal would provide $426,000 more to the port over the term of the contract; Five Star’s Wolk said his company’s offer would generate at least $500,000 and perhaps as much as $1 million more for the department.
“This is an enormous gift of public funds the staff seems to be giving away for no reasonable reasons,” said Wolk, Five Star’s general partner.
The criticism persuaded the commission to order its staff to re-examine the proposals. But that review, concluded two weeks ago, led to a new dispute over the staff’s handling of the contract.
During talks between port staff and favored AMPCO, the company was allowed to change its offer to match Five Star’s, guaranteeing a higher return for the department.
Five Star officials called that action improper, if not illegal.
“To allow a competitor to match a bid . . . is to patently disfigure and make a mockery of a process that is a reflection of the officials who condone it,” said Wolk, whose company’s contracts including operation of parking lots at Los Angeles International Airport, the Music Center and John F. Kennedy Airport in New York.
AMPCO officials and port representatives including Mark Richter, assistant property manager, denied the charge. They said that AMPCO was allowed to revise its offer because the department was soliciting informal proposals, not formal bids. By law, bids cannot be changed to match the competition.
Likewise, Richter and other port officials said AMPCO’s original selection was proper because in this case the port was not bound by competitive bidding laws that require contracts be awarded to the lowest responsible bidder.
“A parking lot operation is a service to customers and visitors of the port, and for that reason, instead of just using a bid, we decided it would be more prudent to use proposals” so factors other than cost could be considered, Richter said.
Ultimately, however, port commissioners decided at last Wednesday’s meeting to start the competition anew after Five Star officials noted that contract documents included the words “bid” and “bidders.”
“Five Star and the others were very clear this was a proposal, not a bid,” Richter said. “But the board felt there was sufficient ambiguity that the prudent thing to do was throw out the proposals and start over.”
In doing so, the board has not quelled the controversy.
“I think (the decision) was purely political . . . there was nothing inappropriate at all about the process,” an angry Robert Hindle of AMPCO said after the commission decision last week.
And as AMPCO and other companies prepare to resubmit proposals to the commission, Five Star’s Wolk said his company is considering legal action against the port for the handling of the contract.
“We think this process has been an outrage,” Wolk said.