Towing Group Sues City Over Contract Bid Delays

In a lawsuit, a group of towing companies have alleged that lobbyists and contractors are so powerful in Los Angeles City Hall that competitive bidding on lucrative police towing contracts has been stalled, in violation of city ordinance.

The three towing firms have asked a judge to transfer the job of overseeing the contract bids from the city to an outside committee because of alleged cozy relationships between unidentified staff of the Los Angeles Police Commission and current franchise holders and their lobbyists.

“It’s disheartening that they [city officials] didn’t do what they were supposed to do,” said Cyndy Franz, president of Mike’s Club Tow in Sun Valley. “Lobbyists have a lot to do with it.”

City officials said Tuesday that staff shortages, not political favoritism, are responsible for delays in awarding the contracts, which give the franchise-holder the exclusive right to respond to police calls for tows in each police division.

“The main reason is, we’re understaffed, and it’s a huge project,” said LAPD Det. Dan Carson, who oversees the contracts. “We’re supposed to [let four contracts] a year. It’s not possible with the staff we have.”

Franz said she would like a chance to bid on Official Police Garage contracts for the North Hollywood and Foothill police divisions in the San Fernando Valley, but neither franchise has been put up for bid.

Sherman Oaks attorney Neil C. Evans, who filed the suit, said the city was supposed to seek competitive bids on 12 of the 18 Official Police Garage contracts by now, but only one contract has been awarded in three years.

Evans, who began taking depositions from city officials this week, said the answer is to transfer the contract oversight to a committee of civilians not employed by the city.

“By doing so, the city will remove the influence of lobbyists and existing [contractors] over the [city] staff, both as to the timing by which the contracts are awarded, and the basis upon which the contracts are awarded,” according to the lawsuit.

Tom John Towing and Goodman’s Culver City Tow have joined in filing the suit.

Carson said he is processing the contracts as fast as he can, but that he and one other employee have primary responsibility for issuing requests for proposals, screening the bids, investigating the bidders and recommending to the Police Commission which bidders should get the contracts.

Assistant City Atty. Byron Boeckman, who is representing the city in the lawsuit, agreed that the delays have been caused by a lack of resources, not who has a lobbyist.

“We believe the Police Commission and its staff is working diligently toward trying to award the contracts as contemplated by the City Council,” Boeckman said.

“There is absolutely no evidence that any party has been the beneficiary of or the victim of any preference or prejudice,” Boeckman said.

The 18 contracts, many of which generate gross revenue of more than $1 million per year, have been the subject of controversy for years, including complaints that some companies have held the police towing contracts for decades without competitive bidding, handing down the franchises from father to son in some cases.

The Los Angeles City Council approved an ordinance that took effect in July 1996, calling for the contracts to be put out to bid and awarded at the rate of four a year. To date, four of the contracts have been put out to bid but only one has been awarded, the Official Police Garage in the Hollenbeck Division of East Los Angeles.

The Times reported in June that current contractors paid more than $100,000 last year to the firm of influential lobbyist Ken Spiker, who for years served as chief legislative analyst, top advisor to the City Council. In addition, Spiker’s company and the firms now holding the contracts contributed $48,000 to elected officials in the last 10 years.

Spiker could not be reached for comment.

Gary Minzer, president of the Official Police Garage Assn., said allegations his group is influencing the city on the delays are without merit. He said the city is making a good-faith effort to award new contracts, and he noted that the award in Hollenbeck Division went to a new firm, not the incumbent.

Carson denied that he or any other city employee has given favorable treatment to anyone.

“It’s absolutely ludicrous,” Carson said of the lawsuit’s allegations. “I’m just doing my job.”

City Councilman Joel Wachs, who said he was not aware of the delays, agreed to review any proposal for additional staff to help process the competitive bids.

“They’d have to make a good case that something is needed, as opposed to them not wanting to do something,” Wachs said.

The lawsuit seeks an injunction and orders the city to turn the process over to an outside committee or award new contracts. It will not be the first time that has happened.

The council adopted the current ordinance after a Superior Court judge ruled in 1994 that the city had to seek competitive bids for the Wilshire Division, because the contract was not transferred through competitive bidding.