Juicy bus contract fight is Vegas politics, baby


Welcome to Las Vegas, First Transit.

Forget about sunblock, poolside cocktails and blackjack tables if you are dropping in for business. To have any glimmer of hope that your venture will succeed -- no matter how viable it is -- you will need high-priced consultants, powerful attorneys and juice. Lots of juice.

So what if your bid to run the city's bus system is $50 million less than that of the competitor, Veolia Transportation. Who cares that your proposal could potentially save taxpayers money during a recession. This is Las Vegas and a contract worth $600 million. You need juice.

But that's the problem. First Transit had juice. It hired longtime consultant Terry Murphy and even brought in Bruce Woodbury, a former Clark County commissioner and godfather of the valley's transit system. They hired former U.S. Sen. Richard Bryan, still an iconic figure in the community.

That looked to be enough to land the contract when on May 19 the Regional Transportation Commission voted 4-3 in favor of First Transit. Then things got messy, as they tend to do in Las Vegas when a $600 million contract is on the table.

"We like to argue the merits of the case, but we realize here, that is not necessarily going to be allowed," Deb Devoe, vice president of First Transit said Wednesday. "It's odd when your bid is $7 million (a year) lower to be in a position to defend your position."

Maybe it's odd in the 50 cities to which you provide service, but this is Vegas, baby. In order for the political weirdness meter to strike odd in this fine city, things like the following must happen.

■ First Transit is asked to turn over highly confidential financial information to the Regional Transportation Commission. Then, while transmitting the documents to an outside financial analyst, they are accidentally posted on a public website. A Veolia representative happens to be online at the same time and downloads the private information. Now if the contract is rebid, Veolia knows exactly how First Transit was able to undercut it by $50 million. Even if it is not rebid, Veolia is in possession of First Transit's business model, giving the company an advantage in future bidding wars. The commission said it was a mistake, and First Transit believes that.

■ Veolia attorney Chris Kaempfer, arguing that the quorum at the May meeting did not meet state requirements, says: "We don't want to go back to the point where, two, three or four people can make policy in Clark County."

For you newcomers, those were the days when the likes of Erin Kenny, Lance Malone, Mary Kincaid-Chauncey and Dario Herrera served on the commission. All four board members ended up in federal prison.

Those were also the days when Triple Five trumped Station Casinos and received permission to build a casino where state law didn't allow. I bring that up because that happened to be a 3-1 vote with four commissioners abstaining. Kaempfer's law partner, Mark Fiorentino, represented Triple Five. I'm sure the law firm received a pretty penny for that, and I don't recall anybody complaining about a four-person panel.

The new state law probably was a good idea. Attorneys for the transportation commission said more than 100 public agencies expected to abide by it were listed in the bill. The commission was not one of them.

I'd expect Veolia's lawyers to argue that all public agencies were expected to follow the spirit of the law.

■ Commission chairman Larry Brown, who refused to sign the First Transit contract, tells the public that despite the price difference, he is sticking by Veolia because he is a loyal guy and they have fulfilled their obligations over the years. Essentially, he doesn't want to turn his back on a private company to save the public agency a few million dollars.

■ Finally, Las Vegas Mayor Oscar Goodman resigns from the board early while Mesquite City Councilman David Bennett, also leaving office next month, remains. It makes one wonder if the commission would be in this mess had Goodman been present at the May meeting. Also, one would expect that both companies will descend on Bennett's replacement like vultures on road kill.

On Thursday, the commission took no action on a protest submitted by Veolia that complained about the scoring process in the bid and argued that a majority vote is based on the number of members on the board, not the number of members present at the meeting.

The commission couldn't muster up the votes to either reject or accept the protest, which means First Transit still technically is in possession of the contract that still hasn't been signed by the chairman.

Newly appointed commissioner Lois Tarkanian wasn't at the May meeting, but was present Thursday. A Veolia employee expressed disappointment following Thursday's discussion, saying his understanding was that Tarkanian would vote for Veolia.

Perhaps his expectations were valid. After all, in 1973, powerhouse political consultant Sig Rogich lured Tarkanian's husband, Jerry Tarkanian, to the University of Nevada, Las Vegas, where he built a basketball dynasty and became one of the most successful coaches in NCAA history. Rogich represents Veolia.

To her credit, Tarkanian said she wasn't intimately familiar with the bids and felt uncomfortable voting on most of the contract-related matters before the board.

It is understandable that bus drivers and mechanics are on edge and are pushing aggressively for Veolia. Change is scary and it is probably difficult to believe First Transit will immediately offer every employee a 3 percent raise in this economic climate.

Las Vegas City Councilman Steve Ross pushed for a new request for proposals to be issued, questioning why two companies' offers could be so vastly different.

"If one price is this high and one is this low, somebody missed something," he said.

Henderson City Councilwoman Debra March came back with this: "Why is Veolia's proposal so much higher? Have they been overcharging the RTC?"

If commissioners are going to remain loyal to Veolia or question a lower bid, it makes you wonder why the Regional Transportation Commission even bothered to issue a request for proposals at all.

Thursday's meeting was contentious, and most agreed everybody had procurement fatigue. At least Clark County Commissioner Chris Guinchigliani offered some levity.

"It's unfortunate everybody had to lawyer up," she said.

No disrespect, commissioner, but this is Vegas, baby.

If you have a question, tip or tirade, call Adrienne Packer at 702-387-2904, or send an email to roadwarrior@reviewjournal .com. Please include your phone number.

 

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