GARDEN GROVE : City Missing $44,000 Owed for Bus Stops

The City Council will hold a public hearing Tuesday to discuss whether to revoke a contract with a firm that failed to make more than $44,000 in payments on 85 bus-stop shelters in the city.

Bustop Shelters of California Inc., which filed for bankruptcy protection in January, signed an agreement in 1990 to provide and sell advertising space on 50 bus shelters and pay the city 19.1% of the ad revenue, city officials said. Last year, Bustop added 35 bus shelters and promised payment of 20.1% of the revenue.

The firm, which does business with cities throughout Southern California, agreed to a minimum payment to the city of $75 per month per shelter at 50 bus stops and a minimum of $90 per month per shelter at 35 additional stops. City officials have calculated the payments Bustop Shelters have failed to make at $44,401.

A company official asked Garden Grove officials this week to waive payments until August on 35 of the shelters.

Robert Bicher, chief executive officer for Metro Display Advertising, which does business as Bustop Shelters, said the company could resume payments to the city after the waiver period, even if it’s just breaking even on the bus shelter advertising revenue.

But in fiery discussions last week, Councilman Frank Kessler said the waiver and failure to pursue the money owed to the city would amount to a gift of public funds.

The company will abandon the 35 shelters if it can’t get a waiver, Bicher said.

City Atty. Stuart B. Scudder has proposed that the city apply Bustop’s performance bond to the company’s debts and ask Bustop to offer a substitute bond. If Bustop doesn’t agree, the council should take steps to contract with another firm to operate the 85 bus shelters, Scudder said.