Denver City Wire

DENVER – Failure to implement audit recommendations means the airport is still not encouraging fair competition when it comes to its parking shuttle services, according to this month’s new follow-up report from Denver Auditor Timothy M. O’Brien, CPA.

“We’ve completed many audits related to Denver International Airport, all pointing to the same concern: lack of competition in the contracting process,” Auditor O’Brien said. “This follow-up shows that even after leadership was made aware of the issue, they did not take serious steps to do better.”

The award-winning 2021 audit showed the airport used a noncompetitive process to keep its current parking shuttle vendor in place. The process of awarding the airport parking shuttle contract to ABM Aviation Inc. — formerly known as ABM Parking Services Inc. — was not competitive enough. It also showed issues with tracking late shuttles and monitoring customer complaints.

We follow up on every audit after the last date of implementation chosen by the audited agency’s leadership for all of the report’s recommendations. Staff turnover means all personnel have changed at the airport’s Parking and Transportation Division since the original audit, which affected the timeliness of implementing some of our recommendations. But still the airport fully implemented only eight out of 22 recommendations and partially implemented five. Eight other recommendations were not implemented at all.

We did find the airport made progress in tracking customer complaints and ensuring a timely response to issues. There are now clear expectations for ABM to respond to most complaints within three business days and records show that is happening most of the time. The airport has also taken steps to assess financial penalties when ABM does not comply with requirements like running buses through parking lots at least six times per hour, as scheduled during busy times.

But the airport’s Parking and Commercial Transportation Division cannot ensure its parking shuttle system contract provides maximum value to the airport — and therefore the public — without a more competitive procurement process.

ABM has been providing airport parking shuttles for years. In 2016, the airport went through a contracting process that gave ABM a clear advantage to remain the shuttle provider because other companies could not procure enough new buses in the time allowed.

New companies would have been given only six to nine months to procure a full fleet of buses when it would have likely taken up to 20 months for the manufacturers to deliver them. On the other hand, ABM already had a fleet, which it bought using the hourly fees the airport paid it under its previous 2008 contract.

“We didn’t find the vendor to be at fault for already having a bus fleet available, but we believe the airport should be aware of the advantage that company has in the procurement process in order to ensure other options and better value could still be considered,” Auditor O’Brien said.

While following up, we found the airport has a third amendment extending this contract pending approval, which would allow ABM to continue providing services without a competitive process. Staff said the amendment was necessary to give them time to prepare for a more competitive procurement in the future.

In the meantime, the airport’s contract with ABM requires it to implement a new GPS tracking system for the buses, as we recommended. A new system will help better track the timing of the buses because if they are late entering the parking lots, the airport could assess millions of dollars in penalties. A tracking system will help enforce that or deter late buses.

The problem is the airport has given ABM 11 months to have the system fully working — the airport expects this to happen by June 2023. On the other hand, the airport intends to give other interested vendors only one month to implement a similar system when it comes time to competitively bid out the contract. Once again giving the same vendor an unfair advantage.

“The procurement process can be slow, and this particular service requires highly specialized equipment and technology, but that should not stop the airport from considering competitors,” Auditor O’Brien said.

The airport also has not conducted cost-benefit analyses of the parking shuttle contract that would look at operations management, ownership of buses, the average age of buses, and desired service intervals. Considering an in-house option for ownership of the buses, for example, could improve the opportunity for competition when it comes to operating them.

“The airport needs an open, fair, and competitive process for this and other contracts whenever possible,” Auditor O’Brien said. “City and airport leadership needs to improve contract procurement and oversight as soon as possible.”

Original source can be found here.