Asheville’s public transit system operated five months in 2007 without a contract while paying a private firm $11,339 per month to run the city’s bus routes, according to documents obtained by Carolina Journal.
A representative of the Asheville transit department declined to comment on why officials allowed the contract to lapse. The delay was caused by personnel matters, which could not be discussed with the press, the representative said.
In July 2002, Asheville signed a contract with Professional Transit Management, a private company based in Ohio, to operate the city’s transit system. State law bans municipalities from engaging unions in collective bargaining, so cities must hire independent firms to manage transit systems.
The contract with PTM was effective through June 2005, but it included two one-year extensions that the city approved subsequently. The city was supposed to either renew its contract with PTM or hire a different management company by June 2007, but transit officials waited until September to issue a request for proposals.
Two days after PTM’s contract expired June 30, 2007, Alex Roman, region vice president for PTM, contacted the city and requested confirmation of a three-month extension of the contract while the bidding process went forward.
“We didn’t have an option for an extension [in the contract], but the city wasn’t prepared, so for whatever reason they asked us to extend,” Roman said in a telephone interview with CJ.
The city did not act until Dec. 4, 2007, when City Manager Gary Jackson signed a six-month extension of PTM’s contract. The extension was effective from July 1 through Dec. 31, 2007. It obligated the city to pay PTM $11,339 per month for the duration of the extension, an amount the city had already been paying the company during the preceding five months, even without a contract in place.
Asked why the city waited almost half a year to sign a contract extension, Jackson deferred the question to Cathy Ball, director of the Transportation and Engineering Department for the city. Ball said internal matters caused the delay.
“There were some personnel issues that have been dealt with,” she said. “There was an issue of timeliness with getting a request for proposals out. We had to go through a pretty regimented process for that.”
E-mailed questions to Asheville Mayor Terry Bellamy elicited a similar response. “The delay was due to a transition in staff management personnel,” she wrote.
Signing contract extensions while a request for proposals is ongoing is “not very typical,” Roman said. “There were some turnover issues in the city’s transit office, so perhaps they had to deal with it,” he said. “I can’t speak as to why it took so long to get it signed. We kept managing on the basis of their assurance that it was in process.”
Pre-award protest
In January and again in April, Asheville and PTM agreed to two more three-month extensions. Shortly before the last extension was signed, Thomas Hock, PTM’s chief executive officer, wrote a letter to Asheville procurement manager Amy Patterson protesting the city’s awarding of the transit management contract to a competitor, McDonald Transit Associates.
Hock objected to the city’s ranking of McDonald higher than PTM in its evaluation of potential transit management companies.
“[Our] protest is based on the very serious concerns we have regarding the integrity of and discrepancies in the City’s procurement process,” Hock wrote. “Specifically, PTM is concerned with the City’s disregard for adhering to the published procurement timeline and lack of direct, meaningful communication (written or otherwise) from the City regarding the status of the procurement process.”
In a second letter dated two weeks later, Hock suggested that the city clear all proposals and establish new guidelines for looking at potential transit management firms. The city never did this. Instead, it switched the awarding of its transit contract from McDonald Transit Associates to the last-place bidder for the contract, First Transit.
Ball said that PTM has not filed a post-award protest, which would require the city to review its process of evaluating the contractors again. After receiving Hock’s complaint, however, the city re-examined the process to ensure it was fair, Ball said.
“We went back and reviewed it with our purchasing folks and legal folks, and we felt like we were doing the right thing,” she said.
Roman said he still does not know why the city elected to replace PTM with First Transit. “We had requested copies of the award post scoring evaluations, but they have said they cannot release the information, so we haven’t seen it,” he said.
Asked why the city opted to hire First Transit, the company that placed last among the three bidders for the contract, Bellamy wrote, “[T]he decision was to engage the firm showing the most preparedness through their proposal, interview, and references, to fulfill the future system management role.”
First Transit contract delayed
PTM’s last contract extension expired June 30, but Asheville city leaders waited almost three months to finalize the new contract with First Transit.
On June 10, the Asheville City Council passed unanimously a resolution authorizing Jackson to enter into an agreement with First Transit. The company took over operations of the city’s transit system less than one month later, but the city did not officially sign the contract until Sept. 19.
After CJ’s initial request for a copy of the contract, Trish Hardin, interim public information officer for Asheville, said that the city’s legal department had not yet received it from First Transit’s legal counsel.
David N. Bass is an associate editor of Carolina Journal.