After Review: City Recommends Approval of $9 Million Parking Lot Contract with Originally Approved Proposer

A City staff “do-over” ends up picking originally proposed vendor to manage parking garages in and around Old Pasadena.

Published : Monday, October 23, 2017 | 5:21 AM

The Pasadena City Council is set to vote Monday evening to approve a staff recommendation to award a $9 million-plus contract to LAZ Parking Services, a Hartford, Connecticut-based company, to manage and operate The Paseo Subterranean, Marengo, Los Robles, Holly Street, Del Mar Station, School House, Delacey, and Marriott parking garages, in and around Old Pasadena.

The Council had previously decided not to vote on the Transportation Department’s recommendation of LAZ, on July 24, following comments from Gary Pitts, president of Modern Parking, Inc, who stood to make the claim before the Council that LAZ had been released from its contract with the Metro Boston Transit Authority (MBTA) in 2016, following an Metro Boston investigation into parking revenue fraud. Employees of LAZ were reportedly fired, and the Metro Boston contract was then put out to bid again. LAZ had reportedly bid on the re-issued Metro Boston project, but was turned down.

Instead, the Council accepted City Manager Steve Mermell’s recommendation that the City conduct an internal re-review of all the bids and proposals and either “start all over again,” or select a new contract winner, or go with the City staff’s original recommendation.

Shortly after the Pasadena City Council vote postponement, LAZ attorney Chris C. Tsouros said any references to criminal wrongdoing by LAZ Parking were not true.

“As the attorney who has been representing LAZ Parking from the beginning of this matter,” said Tsoros, “any statement that LAZ Parking has been convicted or even charged with any criminal wrongdoing is just plain wrong,” Tsouros said. “This matter involved alleged thefts by a few low-level rogue employees at a limited number of cash lots. LAZ has committed to making full restitution to the Massachusetts Bay Transit Authority (MBTA) for these unwarranted acts and the case has recently been settled.”

LAZ was one of five parking companies who submitted a bid for the Pasadena contract back in March, going against Modern Parking, Inc. (MPI), of Los Angeles; Parking Company of America (PCAM), Los Angeles CA; and Parking Concepts, Inc. (PCI), of Los Angeles.

The proposal by LAZ Parking was rated highest by Pasadena city staff on the basis of the firm’s comprehensive Management, Operation and Maintenance Program and Cash Management, Reporting and Audit Program. LAZ Parking was also awarded the highest score by each of the evaluation committee members. City Transportation staff recommended the award of the contract to LAZ.

In an August 4 letter to Mayor Terry Tornek and other city officials, attorney Tsouros followed up by writing that “LAZ has been very open and transparent with respect to any and all litigation requests made on behalf of the City as requested during the RFP process.”

With regard to the litigation filed against LAZ by the Massachusetts Bay Transportation Authority, Tsoros wrote that “A full settlement has been reached with all parties.”

Tsoros explained further, “As a result of LAZ’s investigation in March 2016, employee theft was identified from certain cash-operated lots, resulting in the termination of the few employees involved. Throughout the ensuing investigatory processes, LAZ has been diligent, fully engaged and cooperative with the Massachusetts authorities involved, to identify the nature and extent of the financial losses to the MBTA.”

Tsoros continued, “As of the date of this correspondence, all claims have been fully settled; LAZ has made full restitution to the MBTA for the losses incurred; and all pending litigation including Mass Attorney General civil investigatory proceedings) has been fully dismissed, without any admission of any liability by LAZ.” The amount of the settlement was not revealed.

According to the City’s staff report, a panel consisting of Erika Estrada, Purchasing Administrator, Finance Department; Jon Hamblen, Parking Manager, Transportation Department; Brenda Harvey-Williams, Finance and Management Services Administrator, Public Works Department, serving as Chair; and Nicholas G. Rodriguez, Assistant City Manager, City Manager’s Office, was convened in September.

On September 14, 2017 five modified proposals were received and evaluated by the panel.

The scores of each member of the internal panel were arrived at individually and then combined onto a spreadsheet, which produced an overall score for each proposer, as set forth below. The individual scores were not changed nor adjusted at any point in time, with each member of the internal panel approving the overall result, the report stated..

LAZ Parking scored the highest with a score of 85.05, and staff recommended award of the contract.

The staff report noted that LAZ Parking operates over 2,600 locations in 344 cities in 26 states and employs approximately 11,000 people.

Further, said the report, “with respect to the issue raised at City Council, the internal review panel was satisfied with the additional information and explanations that LAZ provided concerning past and potential litigation in general, and the specific details which it provided concerning its contract with the Massachusetts Bay Transportation Authority (MBTA).”

On July 31, 2017 LAZ and MBTA announced they entered a settlement to resolve their pending disputes, without any admission of liability by LAZ.

The staff report concluded, “The internal review panel believes that this matter would not support a determination that LAZ is not a responsible proposer, and each member of the panel gave it the weight they felt appropriate in the scoring. All but one of the proposers reported litigation histories. The internal review panel considered all of them, and there was no litigation history that would result in disqualification of any proposer.”

Staff also checked LAZ Parking’s references, according to its report, and overall the references reported that LAZ Parking’s performance is “solid.” The references also indicated that LAZ Parking “provided suggestions for process improvements on a regular basis.”

City staff noted in their report that the panel “did consider and allow for the possibility of awarding the contract to more than one proposer,” however, “because of the strength of LAZ Parking’s proposal and reference checks, staff recommends the contract be awarded solely to LAZ Parking.”

Gary Pitts of Modern Parking Inc., who first brought the matter of East Coast investigation into LAZ before the Council, did not respond last week to calls or e-mails requesting comment on the Council’s decision to move ahead with LAZ.

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