Tuesday, February 18, 2014

Abele Wants To Take Us For A Ride

About a year ago, Chris Abele had one of his now infamous temper tantrums and fired Frank Busalacchi, the then head of the public works and transportation department.  Unfortunately, at the time of Abele's tantrum, there was a snafu happening in the subcontracting of paratransit services.  The result of not having anyone to respond to the managing company, Milwaukee Transit Services (MTS) was a $9 million bill that could have been avoided.

Instead of owning up to the responsibility of his actions, Abele used MTS as a scapegoat and vowed that they would lose their contract to run the county's transit system.

To fulfill that vow, Abele put out a request for bids and set up a Byzantine system that involved a secret panel of "experts" and a backwards bidding system in which Abele set the price and the proposed vendors came up with the specifics.

The results of this stunt was that a for-profit company based in Texas, MV Transportation*, was named the winner.  But Abele refused to explain what his decision was based on or allow anyone to see any of the documents to confirm that this was indeed the best deal.

Two of the companies that lost the bidding process - MTS and Veolia Transportation - filed complaints and ultimately a lawsuit to get the documents regarding the bidding process.  Once the papers were released because of a court order, it quickly became obvious why Abele didn't want them made public.

Thanks to the intrepid reporting by Lisa Kaiser of the Shepherd Express, we learned that it turned out that MV Transportation actually lost in four of the five categories the bidding was based on.  The sections in which they failed were related to service.  The only section that MV Transportation won was on price.  But even then, transit experts pointed out that MV Transportation low-balled their bid.

To help ensure MV Transportation won the contract, Abele's people went back to ask them for "clarification."   Abele did not do this for any of the other companies that had bid on the contract.

Once Abele announced them the winner, MV Transportation has already shown that their bid was a bait and switch routine by asking to renegotiate their fee:
In response, MV more or less said that it wanted to renegotiate its expenses after it won the contract.

“If selected, the company respectfully requests to sit down with the county to decide on a final allocation between the three cost components, based on the county’s interpretation of the individual cost elements,” MV answered. “Then the final amounts written into the contract would be binding to MV for the contract term.”
As if this wasn't enough, it also turns out that Abele had designed the bidding process in such a way as to ensure that it was stacked against MTS by asking questions like naming three references for other systems the company ran, but then not following up on the reference. Furthermore, they didn't even do the basic step of interviewing the companies:
“We’ve never had any proposal for any project not have an interview,” Alexander told the Shepherd. “This was a first. And for something of this size, it was really surprising.”

MTS’s attorney Van Schyndle agreed that the absence of interviews was “crazy,” and added that many of the questions in the RFP penalized MTS in favor of a new operator. For example, one question asked for up to three references from cities in which the bidder has operations similar to Milwaukee County’s system. Since MTS only operates in Milwaukee County, it provided just one reference but more than 20 letters of recommendation from local leaders. MTS scored just 41 points for its answer, while MV earned 55 points.

MTS argues that if MV’s references had been checked, the Abele administration would have discovered that MV doesn’t operate any bus systems that are as large as Milwaukee County’s.

“At no point in the record that we received did it show any indication or a memo saying they called references or anything like that,” Van Schyndle said. “That’s crazy to me. I don’t like to throw out words like dereliction of duty, but that is crazy to me.”
As this information came out, MV started to do damage control by trying to persuade public opinion of their company. They sent out postcards announcing open houses across the county and advertising a website to promote their propaganda.

But their claims are about as trustworthy as Abele's bidding process.

They claim to "understand the importance of unions, have worked closely with unions and want to retain workers.  However, as I had pointed out months ago, their track record with the unions is really not good at all and had led to a number of strikes around the nation:
MV Transportation has acted as if they will be glad to take on the current drivers of ATU 998 and honor their contract, which was just entered last month. 

Their track record shows that this is anything but the reality of how they operate.

A quick Google search shows a history of labor struggles in almost every community they have been involved, including RenoSanta ClaritaNew York City and Chicago.  In Fairfield, California, MV Transportation refused to pay their drivers for hours worked, prompting a federal law suit.
MV also claims that they don't want to make a profit off this contract and that they would reinvest the money into the community. Likewise, they will tell anyone who would listen that they are all about service.

Again, this is just a corporate snow job.

In Fairfield, California, MV was fined nearly 300 times for failing to provide proper service or properly maintaining the buses.  MV's response to the fines was very telling on who they really are:
MV executives were furious about the fines. In meetings with the FAST staff, they complained they were “losing money” and the deal they signed was too punitive, according to meeting notes and internal memos.

As the friction between Fink and the company peaked in the summer of 2009, Monson, then MV’s board chairman, made $10,000 campaign donations to City Councilman John Mraz and City Councilwoman Catherine Moy. Those were hefty sums, even in a city with no campaign contribution limits. When contacted for comment, Mraz called Fink an expletive and hung up the phone. Moy did not return emails or phone calls.
As the gentle reader can plainly see, their only interest was their profits and that they were willing to buy off the local politicians to make their problems go away.

Another example comes from Lake County, Florida, where they did an audit of MV's operation there. Overall, it was a pretty damning report, finding a lot of major flaws and inefficiencies.  But the most disconcerting one was that MV was caught cooking the books to increase their profit margin:
Management routinely manipulates completed trip data to maximize revenues from funding sources.
When trips are scheduled, the system assigns the funding source for the trip based on the code
assigned by staff. However, after the close of the month, Division staff orders the Contractor to
change some of the funding sources. For example, for the month of May 2012, the funding sources
for 4,308 out of 11,416 trips, nearly 38% were altered. For this month, the total funding billed was

Perhaps the best summary of MV's style of operation comes from the article regarding Fairfield:
Fink now works at the San Joaquin Regional Rail Commission in Stockton. Reflecting back on his time in Fairfield, he said it taught him a lesson about outsourcing public transit.

“If you had a contractor that wanted to run the business and not maximize their profit at every turn, then it would be fine,” Fink said. “As it tends to work out, you’re spending 85 percent of the time making sure that they’re doing everything in the contract instead of doing the things you need to be doing, like getting grant money doing transit planning.”
To recap, Abele gets caught screwing up again. Instead of taking responsibility for his mistake, he scapegoats MTS and vows to punish them. He does so through the use of apparent bid rigging to give the contract to a for profit company with a very bad reputation.

Sounds wonderful, doesn't it?

The County Board's Administrative Review Committee is set to hear the complaints of MTS And Veolia regarding the bidding process on Tuesday, to determine if the bidding process was conducted appropriately.
The committee could find that the bidding was done fairly or that it wasn't and order that the bids be rescored or that the whole bidding process be done over with.

The committee should find that the bidding process was in error due to the obvious favoritism and manipulation of the process.

If the bidding process should be upheld for some inexplicable reason, the contract should still be rejected due to MV's poor record and dishonest business practices.

Furthermore, this whole thing should be referred to the district attorney's office for investigation into the apparent bid rigging involved with the contract.

ADDENDUM: It appears that Abele is only now asking for feedback regarding what people would like to see in the transit system.  Wouldn't it have behooved him to have done that before doing the bidding process.

*MV stands for Money Vultures.


  1. Keep shining the light on the corrupt Abele administration...and someone please primary him.

  2. Great article. A Blogging Blue commenter suggested Abele is gearing up for a challenge to Senator Ron Johnson. Any truth to that? If so, does it change how he's been operating as MKE County Executive?

    1. I have heard the same rumors. I don't think he's going to change his style. He's still going to adhere to austerity and try to finish what Walker started with driving the county into the ground.

    2. Great. Battle of the Plutocrats: Married for money vs. inherited wealth. Both are perfect representatives of the people of Wisconsin and can relate to the challenges they face! (I wish: the choice is very bad or worse.) Older sociopathic narcissist or younger sociopathic narcissist.
      Please someone, anyone else, I will not be picky about party, throw your hat in the ring. Just bring a small amount of integrity with you.

  3. Watch the video below on how MV lied to the Las Vegas transit workers promising them how they wouldn't slash their wage in half... which they did! watch the towards the last 45 min MV put these Vegas guys through hell