Atlanta Procurement Code Questioned in Travelex Ruling

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(APN) ATLANTA — In a December 15, 2011, ruling, Fulton County Superior Court Judge Cynthia Wright put the City of Atlanta on notice that there are problems with the City’s procurement code which make it impossible for bidders who lose contracts at the airport, or anywhere else, to appeal in a timely fashion.
Travelex Currency Services, a UK-based company which handles currency exchange services, filed a lawsuit on December 02, 2011, against the City of Atlanta; the City Council of Atlanta; Mayor Reed; Louis Miller, Aviation General Manager; and Adam Smith, Chief Procurement Officer, seeking a restraining order to prevent the City from entering into a contract with Lenlyn, Ltd. (doing business as International Currency Exchange or ICE), the company which the City has selected to receive the contract.

As previously reported by APN, Travelex sought access to the proposals submitted by Lenlyn, as well as American Express, which also bid, to the City, because it was in disbelief that Lenlyn scored higher than Travelex.

Travelex has had the contract with Atlanta for seven years, Jon Dario, President of Travelex Currency Services and Regional Divisional Director for Travelex Americas, told Atlanta Progressive News.

”Our concerns started with the fact that we aware that we were the highest bid by far. Our first-year rent bid was 6.6 million dollars. The winning proponent only bid five million,” Dario said.

According to a copy of the scoresheet for the three companies obtained by Atlanta Progressive News, Travelex did receive more points for its financial offer, but Lenlyn was rated higher on its business plan.

“There was a category called business plan which was literally the seven year pro forma
that was to be submitted with the proposal. Lenlyn received a forty percent higher score than we did. We know there’s no way in the world Lenlyn’s business plan was better than ours. We literally have their proposal from a month earlier in the Boston airport and ours were actually better,” Dario said.

“We want to see either the proposals themselves or the rationale as to why the evaluators decided to score the business plan higher, why the City gave up 1.6 million dollars in year one of rents?” Dario said. “It’s our official belief there was a mistake in the scoring process. We’ve been operating in airports for twenty-five years and we’ve never had an experience like this.”

The City of Atlanta argues that the other companies’ proposals are exempt from disclosure under the Georgia Open Records Act, 50-18-72(a)(6)(B), which exempts “engineers cost estimates and rejected or deferred bid proposals until such time as the final award is made, either received or prepared by the Department of Transportation pursuant to Article 4 of Chapter 2 of Title 32, by a county pursuant to Article 3 of Chapter 4 of Title 32, or by a municipality pursuant to Article 4 of Chapter 4 of Title 32.”

Judge Wright agreed that the records were exempt until after the bidding process was complete, which would mean after the Mayor signs the legislation, once approved by the Council.

However, the city’s procurement code requires a bidder to appeal within ten days of the bid selection being announced.

Therefore, Travelex was arguing that they were entitled to expedited discovery of the proposals so that they could enter a timely appeal. Indeed, if Travelex had waited until after the process was finalized, Travelex would no longer be able to appeal.

“The time period between when the City of Atlanta notifies bidders of its intent to enter into contract negotiations with one bidder and to cease negotiations with the others and when the award is ‘final’ is fluid and can be inconsistent under the City of Atlanta procurement code and the Resolution governing the FC-5236 contract. But, in accordance with Atlanta, Ga. Code 2-1161(a), Travelex must submit its protest to the City of Atlanta regarding the award of the contract to Lenlyn no later than ten (10) days after the ‘award of the contract,’” Judge Wright wrote in her ruling.

“This procedure is practically impossible to comply with in light of the obvious impediments to Travelex’s ability to discovery when the award has become final (since the finality of the contract is based upon actions of which Travelex is not a part) and its ability to timely submit its protest after learning of the finality of the award, serving its Open Records Act request on the City to obtain the necessary documents, and allowing the requisite three days for response,” Wright wrote.

“The court appreciates the integrity of the competitive bidding process and the necessity of protecting records that could otherwise impede this process. The Court also recognizes that the ‘letting of public works contracts… is intended to ensure public works projects will be constructed by a qualified or responsible bidder at the lowest possible price and… to ensure that government agencies and contractors do not engage in fraud, collusion, or corruption in the letting of public contracts,’” Wright wrote.

“The Court is concerned that the statutes and local laws governing this process prevent an unsuccessful bidder from any any meaningful review of the City’s basis for and decision to award the contract to the successful bidder until after the Mayor has signed the agreement, which in the Court’s opinion, is likely too late and only serves to promote further litigation and the expenditure of City resources,” Wright wrote.

“The Court acknowledges that in this case, it is bound by precedent to find that the award of the contract to Lenlyn is not final because the City Council has not yet adopted legislation authorizing the execution of the contract, and the Mayor has not signed said legislation,” Wright wrote.

“However, the Court is compelled to note for the record that the City and legislature should be aware of the vagueness inherent in the law and ordinances as to when the award of a contract becomes ‘final,’ and they should also consider the rights of frustrated bidders who need to examine records in preparation for filing a protest after negotiations have ended with the City and the City has announced the party with whom it intends to engage in contract negotiations,” Wright wrote.

“IT IS HEREBY ORDERED AND ADJUDGED that Plaintiff Travelex Currency Services, Inc.’s Motion for Expedited Discovery is DENIED AT THIS POINT IN TIME. Travelex may resubmit this Motion at a later date by leave of the Court,” Wright wrote.

The City of Atlanta misrepresented Wright’s ruling in its media release.

“Today, Fulton County Superior Court Chief Judge Cynthia Wright denied an emergency motion which sought to force the City to disclose all bids for the Foreign Currency Exchange Services contract at Hartsfield-Jackson International Airport. Travelex, which submitted a bid but lost, filed the emergency motion to gain access to all of its competitors’ bids under the Georgia Open Records Act,” the City wrote.

“This decision validates the City’s understanding of the Georgia Open Records Act and the City’s goal to defend ‘the integrity of the competitive bidding process’ by protecting the confidentiality of business competitors’ sensitive information during the bidding process,” the City wrote.

However, this statement is misleading, first because at issue was not whether the records were available under the ORA, but whether they were available under expedited discovery, given the need for Travelex to be able to file a timely procurement appeal with the City.

The City’s statement does not acknowledge while Judge Wright ruled that the documents were not presently available, that Wright said the motion could be submitted again once the Mayor signs the legislation; and that the motion to enjoin the City from entering into the contract with Lenlyn is still on the table.

The City’s statement further does not acknowledge the legal problems Judge Wright found with the City’s procurement code.

(END/2011)

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