News Article - January 01, 2007

Houston firm protests loss of PHL contract
  Unsuccessful in its bid to renew a lucrative airport deal, Houston-based Philadelphia Airport Services is protesting the city's decision to award a $56 million maintenance contract to a rival firm. PAS, which has held the contract since 2000, learned last week that it lost the work to Elliott-Lewis Corp., which told the city it could do the job for $145,000 less per year.

   But in a Dec. 21 letter to the city's procurement department, PAS argues that the contract should be rejected because Elliott-Lewis has not demonstrated "good-faith" efforts in soliciting participation from businesses owned by minorities, women and the disabled. "PAS believes the good-faith requirements that were in the bid documents have not been met by the lowest bidder, and would like to have that reviewed," PAS attorney Nolan Atkinson said yesterday.

   The letter also points out that PAS had proposed directing 41 percent of the contract to minority businesses, while Elliott-Lewis plans to give 26 percent of the contract to minorities. To date, however, PAS has fallen considerably short of existing participation goals.

   The city did not evaluate PAS' minority-participation plan for the new contract because it assessed only the proposal submitted by the low bidder, which in this case was Elliott-Lewis. Northeast Philadelphia-based Elliott-Lewis is set to begin March 1. Also in its letter, PAS says it believes the city violated a 2005 executive order issued by Mayor Street when it decided to disband the use of numeric ranges in its effort to expand minority participation.

   Instead, on this contract the city, for the first time, relied on proof that a "good-faith" effort was made to hire minorities in 10 key work areas, from roofing to building signage. PAS argues that eliminating the numerical participation goals "created overly vague, totally subjective... levels, and improper bid requirements, and that all bids must therefore be rejected."

   City attorneys who handled the airport contract could not be reached yesterday because they were on vacation. The city procurement commissioner did not return a call for comment. Carolyn Nichols, head of the city's Minority Business Enterprise Council, said yesterday she had not seen the 15-page letter.

   "We're confident we did the right thing, and that good-faith effort is a viable means of achieving participation in these contracts," she added. The airport contract has long been controversial. Last year, the Street administration took the unusual step of rejecting an earlier bid by Elliott-Lewis, saying it was unhappy with how the firm planned to direct business to minorities and women.

   Also, federal prosecutors last month indicted the mayor's brother, T. Milton Street Sr., on charges of failing to pay income taxes on $2 million worth of income he drew as a consultant for PAS - including work that helped PAS win the contract to begin with. Yesterday, William Sautter, president and chief executive of Elliott-Lewis, said the company was proceeding with its March 1 start date. He said he was not shocked at the letter of protest filed, but added, "I'm a little surprised it's this late."

   Five years ago, Elliott-Lewis sued the city after it awarded the same contract to PAS; it was ultimately unsuccessful. Elliott-Lewis had performed the work for the 11 previous years.

Source - Philadelphia Inquirer