Travel plaza: State was concerned few would bid
Maryland transporation officials pulled the plug on the bid process for redevelopment of two travel plazas on Interstate 95 largely because they were concerned that their solicitation of proposals had become so muddled that few prospective contractors would have made offers.
Although the Maryland Transportation Authority has been making plans to seek a private partner to redevelop and operate the aging Maryland House and Chesapeake House for more than four years, the request for proposals the agency issued early this year had undergone at least seven revisions and several deadline extensions.
In an interview, Maryland Transportation Secretary Beverly Swaim-Staley said state officials ultimately decider it would be wiser to cancel the RFP, go back to the start and draft a clean document with the help of a consultant familiar with the arcane world of public-private partnerships. Sometime early next year, the state expects to start seeking bids again.
Swaim-Staley was constrained from getting into too much detail by state procurement law, but she outlined as much as she believed she could about the state's reasoning.
"It was just a feeling that maybe we'd best start over," she said. "After you've patched so many times over, then maybe it would be better to start from whole cloth."
Swaim-Staley said the travel plaza deal would involve hundreds of millions of dollars and a term that is expected to be 30 years. "There's certainly no need to rush this. The goal should be to get it right," she said.
The cancellation, coming just a week before bid were due, does have a downside. For a contract this complex, involving multiple specialties, companies generally need to band together and form a consortium to bid. Preparing a bid, only one of which would prevail, can be a costly enterprise in itself. By the time the deadline is a week away, some of the potential bidders are likely to have already sent proposals to the printer. The state's stop-and-start procurement process could very well discourage teams from competing.
Swaim-Staley acknowledged the costs to potential bidders but said there were concerns that the bid process that was in the works would have yielded too few bidders because of "so many changes" to the original solicitation.
One other reason the state might have pulled back from the solicitation may have been a desire to beef up the inducements for bidders to include minority businesses as team members and subcontractors. Swaim-Staley said the original solicitation did not have a minority business enterprise provision because the deal was considered a revenue-producing contract for the state -- and thus exempt from the usual requirements for contracts in which the state is buying goods or services. She said the state would take a look at whether there was a way to promote the participation of minority- and women-owned businesses.
"There are certainly ways to encourage it," she said.
MY TAKE: It would have been better, of course, to get it right the first time. But if the state had doubts it was on the right track, pulling the plug was probably the right call. Public-private partnerships are complex matters because it's important that the state provides an adequate return to the contractor but not a sweetheart deal. And this is a deal the state will have to live with a long time.
There is also likely a sensitivity about bringing any big deal to the Board of Public Works that does not have multiple qualified bidders. There have been a couple of big state contracts recently that were awarded to the sole bidder, and at least one board member -- Comptroller Peter Franchot -- has been outspokenly displeased.
Now the pressure is on the Maryland Department of Transportation to craft a bid solicitation that protects the state's interests, attracts multiple bidders and doesn't require extensive patchwork when it goes back out on the street.