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November 10, 2010

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.

Posted by Michael Dresser at 2:29 PM | | Comments (1)
        

Comments

This is typical for the State. Their employees work with consulting engineers for years to develop plans and when they are put our for bid the contractors find all the mistakes and then here come the addenda. I have seen many projects over the years with more documents issued by addendum than were in the original bid set. This is a problem that no amount of additional gas tax will solve. If only O'Malley would put me in charge for just one week.

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About Michael Dresser
Michael Dresser has been an editor, reporter and columnist with The Sun longer than Baltimore's had a subway. He's covered retailing, telecommunications, state politics and wine. Since 2004, he's been The Sun's transportation writer. He lives in Ellicott City with his wife and travel companion, Cindy.

His Getting There column appears on Mondays. Mike's blog will be a forum for all who are interested in highways, transit and other transportation issues affecting Baltimore, Maryland and the region.
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