By Maria Saporta and David Allison
Editor’s Note: This story has been undated with information about a city audit into airport concessions contracts and a review of pending concessions contracts.
Was Atlanta airport general manager Miguel Southwell fired because he wouldn’t award contracts to “companies other than the highest-ranked bidder”?
That’s the suggestion of a May 31 letter to the city from Southwell’s attorney, Lee Parks, seeking documents related to the sudden May 20 firing by Mayor Kasim Reed of the chief of Hartsfield-Jackson Atlanta International Airport. (To read Southwell’s termination letter, click here.)
“Is it a coincidence that the termination came on the eve of the award of some of the most lucrative contracts in the airport’s long and difficult history of patronage-based awards?,” Parks asked the city.
In March, city officials unveiled a $6 billion, 20-year capital plan for the airport called ATLNext.
But responding to Parks on June 2, city of Atlanta attorney Mark Trigg said that suggestion was “ridiculous, defamatory and has absolutely no basis in fact.”
“As you may know,” Trigg continued, “your letter is not the first time that angry and frustrated third-parties have recklessly contended, without any evidence whatsoever, that the Mayor has attempted to improperly interfere with the established procurement protocols and procedures utilized by the airport. Those frivolous allegations have been categorically disproved in each and every legal forum in which they have been raised in the past, and most assuredly will be disapproved again, should your client be brazen enough to assert them in any type of legal proceeding.”
Parks is also asking the city to turn over numerous documents related to the city’s $6 billion airport expansion; its parking garage construction project; Concourse E food and beverage concessions; Concourse A, B and C food and beverage concessions. Read Parks’ document request to the city here.
Nearly an acre of space for lucrative food and beverage concessions remains up for grabs inside the airport, according to a May 24 review of city records. Most of the 39,465 square feet that’s available is in Concourse E. Nearly 26,000 square feet is available in that one concourse.
Airport concessions contracts are viewed as lucrative businesses. The traveling public is essentially captive inside airport. Time restrictions mean travelers generally have to grab a bite and beverage at whatever establishment is near their gate.
In addition, a contract to the lucrative audit concessionaires every six month has remained pending since it was first posted Sept. 2, 2015. The audit contract is important because concessions contracts call for the city to be paid a percentage of a business’s gross revenue.
Atlanta’s internal auditor, Leslie Ward, is conducting an internal audit into the airport concessions contracts. As stated on the auditor’s website:
- “We are conducting a performance audit of the Concessions Management Unit at Hartsfield Jackson Atlanta International Airport. In fiscal year 2015, about 300 concessionaires generated over $556 million in gross revenue. The airport received over $102 million in revenue from these concessionaires. We are examining whether the airport is managing operations to ensure revenue is recorded, reported, and collected; and concessionaires comply with airport lease agreements.”
David Allison is the editor of the Atlanta Business Chronicle.