City, vendor negotiating secret no-bid vending deal at the Vet

The Street administration is secretly negotiating a $15 million-plus hot dog and beer contract at Veterans Stadium with the very company that has been cited by health authorities for slopping up unsafe food from the ballpark’s vermin-infested kitchens.
The deal, sources said, would shut out bids from competitors and bypass oversight by City Council.

It would give the firm – Aramark Corp. – a leg up on grabbing lucrative concession contracts when the city opens new football and baseball stadiums in the next three years.

And it virtually condemns fans to another season of lousy, overpriced ballpark grub.

A Street administration official said the deal will be “fair and reasonable to the city. ” But critics are starting to pile on.

The current, 15-year-old concession contract ends Sunday, after the Eagles host the Tampa Bay Buccaneers in a first-round playoff game. Aramark has held the contract since the summer, when it bought out longtime concessionaire Ogden Entertainment.

The contract, awarded in 1985, followed a yearlong search by a task force that reviewed bids from a half-dozen firms.

This time – as the city-owned stadium has become a national embarrassment – the Street administration seems prepared to hand a new contract to Aramark without even searching for other bidders, sources said.

It’s a closed-doors deal in which the public is barred from reviewing even the most basic terms until after the contract is signed.

City Solicitor Ken Trujillo declined to discuss the percentage of revenues the city will pocket, minority subcontracting provisions or proposals to improve service and food quality.

He refused even to confirm that the city is talking to Aramark.

Meanwhile, Aramark representatives had no immediate comment about the deal.

In an interview last week, however, Trujillo did reveal that he is negotiating a no-bid “professional services” contract to provide stadium concessions. Those contracts are typically reserved for services – such as legal representation and financial accounting – that require specific professional expertise.

Professional beer vendors?

Trujillo replied: “This contract is not a contract to pour beer. There’s a significant amount of risk inherent in these operations. We want a contract that maximizes the amount the city gets. That’s a function of professionally running the stands. . .There’s a lot of judgment that goes into that. ”

City Controller Jonathan Saidel blasted that stance.

“This is absolutely wrong,” Saidel said. “He has to show some uniqueness that invalidates the RFP [request for proposal] process. A specific expertise in a field, something unique that requires a specialist. . .

“I don’t see anything unique about stadium concessions. ”

City Councilman Jim Kenney, who headed a 1998 investigation into the Vet’s notorious food-and-beverage service, said he is opposed to a no-bid contract.

“There should be some competition,” Kenney said. “The food at Veterans Stadium hasn’t been that great of an experience. ”

Kenney conceded, however, that the administration might be within its rights to grant a one-year professional services contract.

Asked why the city had opted to forego competitive bidding, Trujillo replied: “Timeliness is one reason. We have to get a contract in place. ”

The Phillies’ season begins in fewer than 100 days.

City procurement boss Lew Applebaum said: “We are very concerned. We do not want to end up having an opening game without hot dogs. ”

The last-minute rush is a far cry from the effort that brought about the 1985 contract.

Just as it is today, the city was faced with widespread fan distaste for third-rate junk food.

But instead of dragging its feet, the Wilson Goode administration embarked on a yearlong effort to upgrade concessions. A task force studied more than a dozen concession contracts around the country. Then it brought in a consultant who had helped prepare food for the 1984 Olympics.

There is no task force this year. There are no independent consultants.

There is, however, the People Paper. Here’s our look at issues surrounding the stadium contract.

Terms

THE ’85 CONTRACT: Fifteen years.

THE PROBLEM: The city hoped a long-term contract would provide stable, professional concessions. Once entrenched, though, Ogden had little incentive to improve service.

THE NEW CONTRACT: Professional services contracts are limited to one year. Assuming Aramark gets its act together in the next year, this contract gives it the edge in landing future deals at the new Phillies and Eagles facilities.

Improvements

THE ’85 CONTRACT: Suffering from years of neglect by the previous vendor, the Vet needed a cleanup. Ogden was required to spend $6.5 million on new equipment and other fixups, including the new food court.

THE PROBLEM: Fifteen years later, the stadium needs another fixup. Food areas are coated with bird droppings and grime, kitchen facilities need upgrading.

THE NEW CONTRACT: This time, Aramark has only one year to recoup the cost of capital improvements. Forget a sparkling, new food court – fans will be lucky to see clean fingernails.

City revenue

THE ’85 CONTRACT: Ogden won it by offering the city a bigger take of concession revenues than its rivals. The city collected as much as 58 cents on every dollar spent by fans. In recent years, total concession revenues have ranged between $13 million and $26 million.

THE PROBLEM: Loopholes in that formula made it more profitable for Ogden to sell inferior food at limited locations. Some City Hall officials now believe the size of the city’s cut was too big, and that reducing it might improve the food quality.

THE NEW CONTRACT: Will the city accept a smaller percentage of revenues? And if it does, how will the city ensure that leads to improved food service?

Minority employment

THE ’85 CONTRACT: Its minority employment requirements were an unprecedented attempt to share the wealth. Ogden was required to give a portion of its revenues to a minority partnership group headed by Clarence Farmer, then the head of the city Human Relations Commission. And the company was to bring in minority subcontractors who would operate individual concession stands.

THE PROBLEM: Monitoring of those minority provisions has been almost nonexistent. Subcontractors complain they have reaped few profits, and the city now faces a legal challenge over its enforcement of the minority provisions.

THE NEW CONTRACT: Will the city require a minority partnership and subcontracting? How will it enforce those provisions?

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