County needs to get serious about making bidding equitable
Written by Michael Lewis on November 20, 2013
Why does Miami-Dade mess up so many bid offerings?
Equally vital, what should the county do when it does foul one up?
These questions aren’t theoretical. They apply to real offerings of planned contracts that constantly languish somewhere between a county call for a partner and a deal that actually gets done.
Many fumbled offerings come from Miami International Airport, maybe because of higher stakes or perhaps because the Aviation Department seeks so many deals that odds are greater that it will muff many.
Now in headlines is the biggest current county offering, with a payout in billions. Mayor Carlos Gimenez and commissioners have been kicking back and forth two bids to oversee federally required repairs to decaying sewerage that probably will end up at more than $2 billion spent.
The controversy involves documents one firm submitted outside the formal bid and that the county accepted, to which the other firm objected. Now the mayor has named a new advisory team to follow up on the original team’s work, with more submissions allowed.
Predictably, the top-rated group objects to a second round while the second-rated firm is applauding.
Because stakes are huge, this gaffe is spotlighted. But it’s hardly the first of a long string of bids that ended with the county altering procedures after the fact or throwing out all bids and starting over with new parameters.
Among battles was intensely lobbied airport baggage-wrapping work. Commissioners in March bypassed the top-ranked bid and took the second choice by a veto-proof majority. The mayor vetoed the choice anyway. And in April the commissioners did override the mayor.
Requests to run the county’s airport hotel have for years produced firms willing to work under complex county control – strictures that deter many firms – yet commissioners have never accepted a one and now the aviation director wants to start over. So the hotel remains under a firm in which the previous aviation director said he had no faith, with several former hotel workers facing criminal charges.
Eight years ago, after soliciting bids for dozens of airport stores, commissioners rejected all bids and started over.
There often seems to be a flaw, real or perceived, in bid procedures or execution and the county finds a reason not to cut a deal.
As commissioners recently noted, that costs the county little but leaves businesses holding an expensive bag of absolutely nothing in return for a lot of labor in making bids.
What commissioners have not noted is that after businesses repeatedly expend time, effort and money to prepare, submit and lobby (because lobbying is a near must to win a county contract) in hopes of a deal that ultimately falls apart, bidders build extra fees into every county offering to recoup those expenses several times over.
So taxpayers routinely overpay because businesses pay more than they should to win a bid in the first place. When someone pays, it’s taxpayers who ultimately become that someone.
Even in flawless bidding – yes, some go well – taxpayers pay for businesses to fill out many affidavits and forms to comply with county demands to prove that they do not discriminate, follow labor laws, don’t do business with the wrong nations, have proper mixes of employees, and contribute to the right elected officials (OK, I made the last one up – I hope).
Among the requirements, the bid meetings, the lobbying, a system that hands extra points to locally based companies, and then the chance that the county will reject every single bid and change course, why would anyone bid? Many figure that doing business with the county isn’t worth the price. Just be glad some do.
Last week, amidst jockeying on the gigantic sewerage contract, commissioners put off to the undefined future a tiny decision that embodies what is wrong in county contracting.
The airport in March 2012 sought proposals for a pizzeria in a 225-square-foot slice of its North Terminal. Bidders got past a selection meeting that recommended oral presentations. Nine of them presented orally in February. One was chosen.
Last week, 20 months after seeking proposals, the Aviation Department asked commissioners to reject all bids and dump the pizzeria idea altogether.
The reason: the site never had utilities or ventilation for a pizzeria – or for heating food. The county’s building code and design guides for the area wouldn’t allow a pizzeria there in the first place. But businesses had to work 20 months for a contract to learn they were seeking the impossible.
Now a final decision is again delayed, with the airport eyeing something other than pizza there.
Without asking embarrassing questions like why the airport didn’t know it couldn’t allow what it was asking businesses to provide or why the county’s lawyers didn’t look before asking for bids – why would you seek bids on something that’s illegal? – we will wonder what the county could do beyond just telling businesses sorry, all your efforts go into the trash because the county is incompetent.
First, the barriers to a pizzeria are county regulations. Miami-Dade could waive them.
But since that might not be safe, the county could install ventilation and proper utilities. OK, that would cost money and cut into airport concession profits. But isn’t it the right thing rather than leave nine businesses cheated by county incompetence?
And if that doesn’t work out, surely the airport can find a good 225 square feet for the winning pizzeria somewhere else. If the airport loses on the deal because it would have had another tenant paying more for the spot, it’s equitable that the county, not the pizzeria, take the hit.
If that doesn’t work out, the airport should simply pay nine bidders for all their work. Again, why should bidders take the hit when the airport was the culprit?
Take any of these routes and bidders will gain faith in the county. Fail to make amends for a county mistake and bidders will take it out of taxpayers’ hides in the future, one way or another.
Bidders need to feel a new sense of county seriousness of purpose. Capriciousness in contracting has been costing taxpayers big money for years.
Making good when the county fouls up a contract bid isn’t just common decency. It’s common sense .