Airport concessions contracts: A year of contention, still no end in sight
By David Pendered
The jockeying for concessions contracts at Atlanta’s airport has gone on for almost a year and no final resolution of the overall situation is in sight.
The contract for ground shuttle services is again on the table. Contracts for food and drink concessionaires may again be on the table, following intervention by the FAA – which contends that four winning firms weren’t eligible for preferences they received in the selection process.
The contract for currency exchange was resolved in May, but only after months of debate and after bloggers had complained that only 16 currencies were available from the initial winning vendor – too few for their needs, judging by their comments.
The main area of trouble for the food and beverage contracts is in the arena of small packages. These packages were tailored to allow small groups of local companies to have a shot at the lucrative business at the airport.
Of the four small packages of contracts that were awarded, three were awarded to vendors whom the FAA has said do not meet the certification requirements of the federal program to help Airport Concessions Disadvantaged Business Enterprises.
The fourth concessionaire, which was not cited, is Global Concessions, Inc.
Its CEO is Terry Harps, and the company has been in business since before 1990. That is the year the company’s changed from Grecian Foods, Inc., according to Georgia’ secretary of state. No information about that company is available on the secretary’s website.
The only major vendor to be named by the FAA is Hojeij Branded Foods, Inc. The company was chosen to run all the restaurants in Concourse A, a main area for Delta.
A total of five packages were issued to run most of the food and drink outlets in the airport. These packages also were the source of much of the controversy last summer, when the city rejected all bids and started the process anew. The delay resulted in Mayor Kasim Reed signing contracts six months behind schedule.
The only sites in Concourse A that aren’t run by Hojeij are to be run by Mack II – which also was named by the FAA as ineligible as an ACDBE. The company is headed by longtime airport concessionaire Mack Wilbourn.
Hojeij has been embroiled for years in a controversy over its ACDBE status in a lawsuit stemming from concessions contracts at the Orlando airport. That lawsuit contends, as does the FAA ruling, that company owner Carol Hojeij’s personal net worth exceeds the program limits.
The companies the FAA cited as ineligible for the ACDBE program are:
- Atlanta Restaurant Partners, LLC;
- Hojeij Branded Foods, Inc.
- Mack II, Inc.;
- Vida Concessions, Inc.
The city’s decision to terminate its request for proposals to provide shuttle services came with little explanation on Aug. 9. The most telling comment made be in the second paragraph of the following statement, concerning a change in the composition of the team of evaluators who will select a vendor.
Here’s the full text of the city’s media statement:
“Adam Smith, chief procurement officer for the city of Atlanta, today announced his decision to cancel the shared ride shuttle services request for proposals at Hartsfield-Jackson Atlanta International Airport.
“Smith said: ‘I have concluded that it is in the best interest of the city to cancel the shared ride shuttle services RFP. The re-issued RFP will be consistent with the airport’s upcoming enhanced ground transportation processes, address the needs of the now-operational international terminal, and maintain the airport’s best-in-class services. The city will also increase the number of evaluators who will review the proposals to ensure a more in-depth review and selection process.
“The city issued a RFP for the shuttle service contract in October 2011. In the interim, the airport asked a group of permitted shuttle providers to recommend a process for providing shared ride services. That process, which provides services to travelers through the currently permitted vendors, will remain in effect until a new contract is executed.”