SR-6-D (79)
(OJ)
API 1 3 199
Purch PW ML rah F \FINANCE\PURCH\STFRPTS\SRBD2746 WPD
Council Meetmg Apnl 13, 1999 Santa Monica, Callforma
TO Mayor and City Council
FROM City Staff
SUBJECT Recommendation to Reject all Bids to Provide Transit Bus AdvertiSing
Concession, Bid #2746
Introduction
ThiS report recommends rejection of all bids for a five-year advertiSing concession on
Santa MOnica's Big Blue Buses With three one-year renewal options
Backaround
On February 25 and 26, 1999, In accordance With City Charter and Municipal Code
proVIsions, Notices Inviting Bids were published for a five-year conceSSion, With three
additional one-year options, for advertiSing on the mSlde and outside of Santa MOnica's
Big Blue Buses The one-year options may be exercised umlaterally by the City Proposal
forms were mailed to seven potential conceSSionaIres Five proposals were received
The City received protests regardmg the opening of the bids Due to unresolvable
questions concerning when certain bids were received, It IS necessary to reject all bids
and rebid the requirement The City Attorney concurs With thiS action
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APR '3 1199
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Budget/FinancIal Impact
This recommendation has no budget/flnanclallmpact
Recommendation
It IS recommended that Council reject all bids for BId #2746 and direct staff to rebid the
requirement
Prepared By Pam Wortham, Purchasing Agent
Margarita Lee, Buyer
Stephanie Negnff, Transit Development Manager
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r ~pR-Ll-1999 SU~ 06:55 PM GATEWAY OUTDOOR ADV FAX NO, 9088848i33 P. -02
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Gateway Outdoor Advertising
and
City of Santa Monica-Big Blue Bus Advertising Contract
Hir;tory of Contract:
GatC\\ruy was awarded the transit adverl1smg contract In Februmy, ] 994 under a cOmpet1l1vt: bid
proces'i ^-t that tU~lC JDl, the mcumbent. began arelentle~s process of trying to ovel1urn the
award 10 Gateway We had the highest guarantee to the Clly and we prevailed
Slllce that time we increased revenues on the buses from $573,000 cmnually tn $1,444.000 by the
llmd year ofthc contract A 300(% increase over TDll Thls ah..o resulted in the Cuy receivlllg
con"iHlerclhly morc guarantees compared to TDI
ntll iug our 5 ye<lr term with the Clty of Santa \1omca we have
-Used a DI3E called MBE EnterprISes
-Pro\'lded $10,000 annually for School Rlde~ at the Santa Manica School Dlstnct
workmg \\'1th Nell Schmidt
-Promoted the Santa Monica AIDS prOject
-Active involvement m the Santa yl0nlCa PolIce "Don't f)] mk and Dnve Camps.ign"
-Pdrtncrship with Santa ~10111ca Co\1egt: Summer p:'o:;ram
.Publlc RadIo KCRW ~ponsOlship
-Getty Museum "Poetry in MotIOn' sponsorshi?
-SJ.ntJ. MO;UCd Church sponsolshlP festj\.'al
-Pacific ChrIstian School spol1.:,orship
-City of Santa MO:lll'a "Get Nil and Vot:::-" cClmpaign spo:1Sorship
This is Ju.;;llo n~'J:ne a fcw, besldes sponsonng the Rodeo, Annual Dinner and other prol11ol1on<:; at
no charge to the City_
New 1999 Bid:
TIllS past month we bId agalll for the nghts to continue dOlllg busmess in Santa Monica Our bld
compared to the competitIon lS shown on the attached. Gateway is millions of dollars ahead or
the competition and we w~re informed we had won When we receIved the call on Mareh 29, I
returned the call to Janet Shelton ".t which tIme she told me that we were receivl11g the award and
they were preparing the resolution for the COLlncil She ~~!.Id she needed to get the payment')
cunent and I conllnlled to her my phone mall message thut we are expressing checks tota]mg the
~~R 11 '99 lE 53 9386848:33 p~GE 02
_~ePR-~1-t999 SUN 06:55 Pr. GATEWAY OCTDOCR ADV FAX ~Q. 20868;S133 p, 03
Page 2
$224,25541 that "va~ due. I then laxed her a IeHer contirming this on March 30 On Wednco;day
Jane! called me to a'5k If theIr wele any is~ues they should be aware of cons.idering the nasty
"fight" by ] OJ In 1994 She saId the CIty At~oTl1ey asked her to call me She explained that Oble
had filed a protest agalnst TDl handing the b:d In late. but smce v.e W~rC hIgh bidder It did not
a(Jcct Ollr award 1 explained that the only reccntlSStlC has b~cn OUr recent stock offenng fll:ldmg
that neld up otLr r~eent payments but that this was resolved in March Olhcl wise. the 1999
natIonal tobacco advertismg ban affected most every outdoor advertIsing COll1p,my a"d business
hdd been slow_ But our new fundmg has res:olved tIll'., for m. anyway, b:.lt I cou!dn't speak for
anyone else
On ThUlsday afternoon 1 received a can from la!lCl explained that she dId not unclcrstar:d we
were sendmg several cheekt: and needed the func1s now Whatever the mlsundel:5tand:ng, as my
Icuer and conversatlOn clearly said checks, I told her we would Wire the funds but to ~o ahead
and depOSit the check due Apnl 1 for 1;65,000 I told her I would wire the balance Monday 0r
Tuc~ddY as the Good Friday Hol'day would delay thmgs a day for wiring We anangcd to co this
for 1 ucsday Janet deposlted the 565,000 whIch cleared la~l Wednesday
On Good Fnday, I received word from Ray Pnmlcias, our Sanla Mo.,ica manager that manages
thc hu':> t.on~laCl (MBE Enterpnses. our DBE) that he receIved word th"t the trtlllSil conhacl was
being put back out to bid a~ the Cny Manager wanted to rcsohc the protest by rcbldcll1g As you
know III a bid process ['Ill bIds arc read alo...:d and so now a rebId ab)olutely d~"astatcs the
Gateway victory and awald, The re"OJld notice letter IS attached
Gnte\\ ay then coull<;eled wllh local counsel, t\rtcr & Hadden, and chpkllned how Gale\....ay h"d
won fair and squarc and th~ plOtest letter v. uS unrelated to Gateway, My altomey ha'i now
counc;clcd rr..e to hold payment 111 escrow 10 the CIty unlll our protest and Issue IS heard by the
Clly Counsel It 1S our hope tne CIty Cou~cll v,.,.i 11 move forwa.rd v.f\th the awe.~d to Gatc'ha.Y us
OJ Igma.lly planncd (lnd recommended by staff
Ga:eway ha'5 Invested a great dealm buddIng thc advcJtising on the Blf; Blue Bus and
1l1<tmlameu a great putncrshlp relationship on all fronh. We had also posted a S500,OOO lctter of
CTccht for the past 5 years The ne\-" Iet~er of credIt Increa'ies to oSl ,000.000
Gateway is an employee own~d Lompany th~[ depc-nds on a fair playmg field for blddmg like nus
eonhact, not unrdated protests made to destroy an eff~ctl\'e hiclumg process won faIr and square
Cble had also filed a protest In Portland only 4 weeks ago after losing to TDI That protest was
lhruwn out
111thl~ contract we have also committed to a 40% DDE participation
AC~ 11 '9S :5 s~ ge~S8.ce133 PRG::: e3
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APR-11-1999 SU\{ 12:40 F~ GA;EWAY QJ~DOOR ADV FAX NC. P. 02/08
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RFR 11 '99 lC 39 9285845133 PPGE 02