Saturday, November 23, 2002
Copyright © Las Vegas Review-Journal

Officials lament Californians getting contract

Guinn, Del Papa, Heller admit spending money out of state detrimental to Nevada

CARSON CITY -- State officials awarded a nearly $1 million contract to a Beverly Hills, Calif., public relations agency Friday after lamenting not giving it to a Nevada company.

Ogilvy PR World Wide received a unanimous vote from the Board of Examiners for the contract to manage the Public Safety Department's advertising and public affairs projects during the next three years.

In selecting the company for the Share the Road and motorcycle safety campaigns, Gov. Kenny Guinn, Attorney General Frankie Sue Del Papa and Secretary of State Dean Heller went along with the recommendations of a committee of state employees, which selected Ogilvy over several Nevada companies. Committee members evaluated the companies and chose the one they thought could best perform the projects. Guinn, Del Papa and Heller said they were going along with the committee.

None of the losing companies showed up Friday to protest the selection of Ogilvy, although Paula Yakubik, owner of Massmedia in Las Vegas, said in a telephone conversation Friday that a Nevada firm should have been picked. Yakubik did not bid for the Public Safety Department contract, but earlier this year she lost to Ogilvy when the state Health Division issued a $120,000 contract for a teen pregnancy prevention program.

Yakubik said the Legislature should pass a law to ensure Nevada companies are awarded Nevada projects.

"I employ people in Nevada and I pay Nevada taxes," she said. "We have a lot of great Nevada firms. But you take a $1 million contract and give it to a California firm, and nothing stays in Nevada."

Making the state evaluation process unfair is the fact that she, and other Nevada public relations firms, cannot bid for a contract in California unless she has an office there and has been in business there for two years, according to Yakubik.

Despite their vote for Ogilvy, board members spent much of Friday's meeting saying that a Nevada company should have been selected.

"We are a small state, and we cannot afford to send our discretionary dollars to California," Guinn said.

The governor said selection committees should be encouraged to give "more consideration" to Nevada-based companies because they pay state taxes.

Del Papa said the board did not have to go along with the evaluation committee. She pointed out state law lets the Board of Examiners make decisions in the best interest of the state, not necessarily to second the committee's choices.

"We have some terrific PR firms in our state," she said. "Everyone is hurting here. How do we build up expertise in our state if we don't hire state firms?"

The original contract called for the state to spend as much as $1 million on the new traffic safety campaign. Of the money, $950,000 would come from federal grants and the remaining $50,000 from state funds.

At Heller's request, the Board of Examiners deleted the state funds. He and Guinn said the state should not be spending its general fund revenue at a time when the state faces a $370 million budget deficit.

Use of private public relations firms by state agencies is uncommon. The Transportation Department recently executed a $100,000 contract with Katz & Associates of Las Vegas to handle public relations work on a Reno freeway interchange project. The contract was the first in his 15 years with the agency, department spokesman Scott Magruder said.

The contract for Ogilvy was held up last week when Del Papa objected to the hourly rates listed for the firm's employees: $250 for the managing director, $150 for the art director and $40 for administrative support.

But Kim Evans, a spokeswoman for the Public Safety Department, said Friday she spoke with Ogilvy and the company has agreed to base its rates on the jobs it performs, not hourly rates. Evans was a member of the evaluation committee.

Del Papa said she appreciated the changes because "the hourly rates gave me concern, given how hard we work for what we get."

Dawn Wilcox, Ogilvy senior vice president, said in a telephone interview that her company has 15 years of experience in handling highway safety programs.

Earlier this year, the company did a "No exceptions, No excuses" campaign to encourage seat belt use in Nevada that Evans said led to a 6-percentage-point increase in seat belt use.

"We work in states around the country," Wilcox added. "We are hired for our expertise on a particular issue. I understand the state's concern in keeping work in a state, but it is federal funds."