Airport concessions: FAA to review GDOT ruling on DBE vendors picked by city for some of $3 billion package
By David Pendered
Atlanta may end the year with no final resolution of questions raised by the federal government about some of the $3 billion in airport concessions contracts Mayor Kasim Reed signed March 12.
The Federal Aviation Administration said it may appeal a ruling that favors some vendors chosen by the city, which was issued late Thursday by the state Department of Transportation. The FAA had ordered GDOT to review its decision to award four winning vendors a federal preference that may have helped them win their contracts.
Reed’s administration did not respond to either the GDOT ruling or the FAA response. Instead, the administration issued a statement concerning the decision by a losing concessionaire to stop its litigation. The company was not part of the FAA’s review.
Georgia’s Transportation Department announced late Thursday that it had decided not to decertify four companies from the federal preference program named ACDBE – airport concessionaire disadvantaged business enterprise.
The state’s certification may have provided the four companies a benefit in the scoring system the airport used to rank companies that wanted a city contract to sell food and drink at the airport.
The FAA ordered GDOT to conduct the review after FAA officials determined the four companies did not qualify for the federal preference program.
GDOT conducted four closed-door hearings in November and issued its decisions Thursday afternoon.
The FAA said it is taking GDOT’s ruling under advisement.
The state decision is not binding on the FAA. The FAA could appeal GDOT’s ruling to the U.S. Department of Transportation, which oversees the federal government’s preference program.
The FAA issued this statement after receiving GDOT’s ruling:
- “The FAA will review all documents from the Georgia Dept. of Transportation Airport Concession Disadvantaged Business Enterprise decertification hearings before deciding whether to appeal to the U.S. Dept. of Transportation.”
The four companies are:
- Mack II
- Atlanta Restaurant Partners, LLC
- Hojeij Branded Foods, Inc.
- Vida Concessions, Inc.
Asked to respond to GDOT’s ruling, Reed’s administration said it had issued statement regarding a decision by a concessionaire to drop its legal action against the city.
SSP America, Inc. had competed in five categories for a chance to sell food and drink at some of the 72 sites out for bid. SSP won nothing and challenged the review process.
Reed’s office issued the following statements, which are from the complete statement available here.
- “SSP has now publicly acknowledged what we have known to be true all along: No City elected official or employee acted improperly in connection with the food and beverage contracts awarded at Hartsfield-Jackson. We are happy to put this distraction behind us and look forward to improving and expanding Hartsfield-Jackson Atlanta International Airport and the Maynard H. Jackson Jr. International Terminal as a gateway to the world,” said Mayor Kasim Reed.
SSP America’s comment:
- “SSP believes that it submitted a high quality response to the Atlanta Airport Food and Beverage Concessions RFP in 2011. While SSP challenged the results of the bidding, SSP acknowledges that the hearing officer determined there to be no evidence of any wrongful activity on the part of Mayor Kasim Reed, the Atlanta City Council or any city employees in the bidding process or the awards. SSP will not receive any monetary damages or other compensation of any kind.”
These developments are the latest in a saga that started in January 2011.
That’s when Reed’s administration went to market with a proposal to award all the food and beverage concessions, and several retails stores, at Hartsfield Jackson Atlanta International Airport.
Reed’s administration was barely a year old when the airport convened an industry day, in January 2011, and announced plans for a concessions package that it said was the largest in North American history.
The process proceeded with the usual rumors associated with major government contracts. The process jerked in August 2011, when the city decided to discard the first set of proposals and asking companies to submit new packages.
The Atlanta City Council awarded contracts in January 2012. The mayor waited until March 12 to sign the papers because of an array of challenges.