California state parks officials were irked last summer when about a dozen people complained that they had trouble making reservations for campsites and Hearst Castle tours.
The campers were competing with fans of singer Bruce Springsteen for the attention of clerks at Ticketron outlets, and "there were complaints that the people wishing camping tickets were treated like, 'Hey, come back next week,' " said parks official Clark Woy.
Parks officials had a solution. They were preparing to award a new five-year contract for a reservations system that would require the contractor to accept reservations at a toll-free telephone number for the first time, as well as at designated outlets and by mail.
In the course of evaluating potential contractors, parks officials decided to dump Ticketron--a longtime holder of the contract, even though its bid was the lowest received.
They also rejected the second-lowest bid, made by Ticketmaster, Ticketron's chief competitor in the small, scrappy computerized ticketing industry.
They gave the contract to the highest bidder--a fledgling company called Mistix.
Officials said they chose Mistix because it was "the best, responsible bidder." As such, they said, they believed it would provide better service to the million people a year who make reservations to use state parks.
But that conclusion was apparently based on little more than faith because Mistix had no track record, no ticketing clients and no outlets.
Ticketron filed an official protest, alleging that parks officials abused their discretion and made a "mockery" of the bidding process. That protest, supported by Ticketmaster, has resulted in disclosures that some parks officials were not fully informed when they chose Mistix to handle a system that brings in about one-sixth of the department's revenue.
Some officials involved in the selection, for example, did not know just how fledgling a company Mistix was, according to testimony at ongoing protest hearings before an administrative law judge in Sacramento. Other officials withheld from them the information that Mistix, at the time, had no ticket-issuing capability.
Also withheld from them was information that Mistix's organizer, Lee DeLay, had been president of a company that defaulted on the same Department of Parks and Recreation reservations contract nine years before.
In selecting the untried Mistix, parks department officials took a gamble. Signs are mixed as to whether it will pay off.
Late last month, three weeks after it had promised to be fully operational, Mistix had opened some outlets in Southern California, but walk-in customers in the northern part of the state were generally out of luck.
When a Mistix operator was asked if there were any outlets in Berkeley, as the contract required, she answered with another question: "Is that near Los Angeles?"
The closest outlet turned out to be in San Jose.
On the positive side, Mistix, which is headquartered in La Jolla, has set up a toll-free number for those willing to use credit cards to make reservations, and its officials say they have reached agreements with retail stores to open many more outlets than the 32 required by the parks department.
Parks officials say that only 21 outlets have been opened so far, but report that they are pleased with Mistix's performance and that they have "not been overwhelmed" with complaints.
While it is too soon to say whether the selection of Mistix was wise, it is clear that there were some unusual aspects to the selection process.
For example, getting the best price was not very important to the parks department. Bidders' proposals were scored on a scale that provided for a maximum of 14,700 points. Price accounted for only 350 of those points.
Officials charged with ranking bidders did not do the simple arithmetic necessary to make a thorough price comparison. As a result, these officials did not know how much revenue the state would lose by selecting Mistix as opposed to another bidder. One official testified that he did not realize the state would lose any money.
Bids Regarded as Same
Parks officials said that they could tell at a glance that Mistix's bid--in the form of service charges for individual reservations--was a little higher than those of competing companies, but added that they regarded all bids as roughly the same.
Indeed, when looked at from the standpoint of the service charge an individual pays when making a reservation or canceling one, differences in proposals vary by insignificant amounts--20 cents to $1.
But when contractor's charges to the state are multiplied by volume of tickets sold, differences become significant.
Looked at in this way, Mistix's price over the course of the contract represented an approximate $2-million loss of revenue for the state when compared to Ticketron's.