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Everyone knows monopolies are bad, unless you are one

What a difference four years make when it comes to the philosophy of bus contracts and monopolies. Many of the same people and companies who were opposed to splitting the bus contracts in Southern Nevada then are now for it. And vice versa.

The arguments are much the same; they’re just coming out of different mouths of people whose positions have flipped.

But it does raise questions about why in 2007, when Regional Transportation Commission General Manager Jacob Snow proposed splitting the bus route contract into two contracts, the idea went into Never Never Land when Veolia Transportation held the single contract.

Yet in 2011, when Veolia is the highest bidder for the $600 million bus route contract and First Transit is the low bidder by $50 million, a number of board members are strongly opposed to continuing a monopoly.

In 2007, Veolia argued a single contract brought cost savings. Today, Veolia supports the idea of a split contract because competition is a good thing in the business world.

Of course, First Transit also has switched horses. Four years ago, it was against monopolies. Four years later, it prefers holding the contract all to itself, rightfully contending that’s how the bid request was proposed by the commission board in September.

Clark County Commissioner Larry Brown, Boulder City Mayor Roger Tobler and North Las Vegas Councilman Robert Eliason are the only overlapping members, serving then and now.

The other board members at that time were Clark County Commissioners Bruce Woodbury and Chip Maxfield, Henderson Councilman Andy Hafen, Las Vegas Mayor Oscar Goodman and the former Mesquite Mayor Bill Nicholes.

In 2007, Snow laid out reasons why competing contracts might mean fresh ideas and new approaches.

At the time, Veolia CEO Mark Joseph cautioned against splitting the contract, calling it a serious and major change which was very risky from an operations and relationship standpoint. Costs always went up, he said, when a contract was split, because of redundancies.

Laidlow, MV Public Transportation and First Transit were all for splitting the contract … then.

While no vote was taken back then, Brown and others raised enough concerns that it became obvious the majority of the board didn’t favor two contracts. The idea Snow had presented with such enthusiasm never was presented again, partly because radio frequency issues for communicating with buses couldn’t accommodate two contracts . (Now it’s possible.)

So the idea of split contracts faded away until this year, after Snow recommended that First Transit get the fixed-route contract. First Transit also holds the contract for the public bus system for the disabled.

Now Veolia wants split contracts for the fixed-bus route, and First Transit no longer praises that idea. Instead, First Transit is suing to force the commission to sign the contract.

Today, some board members voice concerns about monopolies: Las Vegas City Council members Lois Tarkanian and Steve Ross and County Commissioner Chris Giunchigliani. Brown has aligned with them, citing unanswered questions.

Brown, the commission chairman, is trying to negotiate a compromise; but now that it’s in the court, compromise becomes less likely. Plus, there are federal laws against agreements between transportation companies, if they come close to price-fixing.

Splitting the contracts may be smart. Or not. But it’s too late to change the rules now. If breaking a monopoly was important to board members, they should have brought it up before issuing the request for proposals. The anti-monopoly folks had their opportunity then, except for Tarkanian, who wasn’t on the board .

Why was a contract for a single company fine in September 2010, but not in August 2011? What’s changed?

The 4-4 split between the eight elected officials on the board has deteriorated into a head-butting contest that would do Nevada’s bighorn sheep proud. But really, big horns are the models of dysfunctional government, not effective government.

Jane Ann Morrison’s column appears Monday, Thursday and Saturday. Email her at Jane@reviewjournal.com or call 702-383-0275. She also blogs at lvrj.com/blogs/morrison.

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