Companies allege car park bidding process was tainted

CITY HALL — A multimillion-dollar contract to operate the city’s four central parking garages was delayed again Tuesday after the City Council, confronted with accusations of a tainted bidding process, was unable to garner enough votes to move forward with a new vendor.

The proposed $5.75-million five-year contract with Modern Parking Inc. has been under fire since June, when the City Council instructed city officials to negotiate exclusively with the Los Angeles-based company after it submitted the lowest of six bids.

Parking Concepts Inc., which currently operates the garages, followed with a protest letter, claiming that Modern Parking had failed to disclose a previous contract termination in Santa Monica, and joined with other competitors in their assertion that the winning bid was artificially low.

Modern Parking’s bid was $652,942 below the average among the six vendors, and $568,492 less than the current contract with Parking Concepts.

Much of the price reduction was achieved through Modern Parking’s move, which the company said was intentional, to subsidize the security costs — a $100,000 cost reduction for the city. Overall, the city stands to save $375,000 through the new contract, although some of that is due to cost reductions made by the city, Traffic and Transportation Administrator Jano Baghdanian said.

Representatives from three of the competing vendors railed against the proposal, which they said was intentionally set low so that Modern Parking could renegotiate a sweeter deal later on, and pleaded with the council to start the bidding process over.

“We really believe this [process] has been compromised,” said Chuck Jelloian, a representative for Central Parking System. “This doesn’t smell good.”

Councilman Dave Weaver sided with Modern Parking’s competitors, saying he didn’t trust the company’s disproportionately low bid.

“I’m sorry, this just doesn’t seem right to me,” he said. “I think it ought to be done over. We have a lot invested here.”

But Mayor John Drayman, together with Councilman Frank Quintero, complained about what they said had become a politicized issue in the face of an outsider outbidding the usual vendor pool.

“What I’m hearing here is a lot of complaining and a lot of political influence being dealt, that’s it,” Drayman said. “We went through a process.”

In the absence of any disqualifying disclosure or negative background checks, Quintero said starting the eight-month bidding war over again was unnecessary.

“As long as the city doesn’t end up subsidizing [the security], what they do with their subcontractors is fine with me,” he said.

But with Councilman Bob Yousefian absent, the dais was split on moving forward with the proposed contract, pushing the matter to a full vote next week.

For the interim, the council approved an additional $725,546 to keep Parking Concepts on board until the latest contract issue is settled. The extension expires March 31.


 JASON WELLS covers City Hall. He may be reached at (818) 637-3235 or by e-mail at jason.wells@latimes.com.

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