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DETROIT-The Detroit News published a December exposé on Detroit Metro Airport, charging that $331 million-worth of the 44 service contracts placed out for bid last year, or 86 percent of the total, were awarded to political contributors of Wayne County Executive Edward H. McNamara. Even worse, McNamara contributors were the sole bidders or faced only one other bidder in 60 percent of the contracts awarded to them.
While privatization saves money and generates better services-it has to be done right. Doing it wrong can be worse than not doing it at all.
As far back as 1997, MPR published The Ten Principles of Successful Contracting, in which we clearly laid out safeguards that any public entity must be willing to put in place to avoid the kind of problems being exposed at Detroit Metro.
In the case of Executive McNamara, there appears to have been serious lack of oversight of his running of the bidding process on the part of the Wayne County Commission. Yet, the bidding process is practically the whole ballgame when it comes to the success or failure of a privatization plan.
Had the Commission insisted on implementation of our Ten Principles, it's not only highly unlikely that corruption would be ruining both the reputation and the success of a major privatization venture, but Detroit Metro Airport might also be well on its way to being one of the most highly rated instead of being rated by customers as one of the nation's worst.
Allowing the bidding process to be corrupted gives ammunition to those who oppose any privatization plan.
One example of what shouldn't happen is the contract awarded for the airport shuttle. A $37.2 million, three-year bus contract was signed with Commuter Express, a company associated with Anthony Soave, an alleged "crony" of County Executive Edward McNamara. The winning bid, in other words, came not from the lowest bidder, but, as the Detroit News opined, "from the best-connected bidder."
The bid from Commuter Express was more than double the $15.2-million offer from low bidder Detroit Motor Coach. The Soave proposal is also $19.6 million higher than the bid from Central Parking System, one of two national firms that submitted bids.
In fact, critics question whether a new contract was needed for shuttle service at all. Shuttle service was already being provided for just $6 million per year by two companies, Commuter Express and Ampco/System Parking Inc. Under the new contract, the county will pay twice that amount to just one company.
