The Los Angeles City Council's Govermental Effieciency Committee was right this week when it unanimously expressed a desire to correct the shabby situation that has allowed a small group of politically well-connected blacks, Latinos and women to skim millions in unearned profits from concessions contracts let by the Department of Airports. Unfortunately, bringing this distasteful episode to an equitable close is likely to be a more difficult and time-consuming process than the committee's action suggests.
As The Times reported last June--and as a subsequent city audit confirmed--the airport's food-service and gift-shop concessionaires, Host International Inc. and Duty Free Shoppers Ltd., have satisfied the equal opportunity requirements in their current city contracts by offering limited partnerships to 18 prominent women and minority community leaders.
Host International and Duty Free took in more than $100 million on their Los Angeles operations last year, and over the past 36 months, $7.3 million has gone to the limited partners, even though they initially invested virtually no money of their own and have done little or nothing since. Nice work, if you can get it. And those who did include the indefatigable Bishop H.H. Brookins, Betty Dixon, the wife of Rep. Julian Dixon (D-Los Angeles), Urban League President John Mack and Attorney Andy. M. Camacho, as well as three Atlanta businessmen who contributed to Mayor Tom Bradley's campaigns.
Thursday, the council committee gave the Department of Airports 45 days to renegotiate the contracts and demanded that the new agreements provide for hands-on participation in the operation of the concessions by legitimate business owned by women and minorities. However, the city attorney's office, which now is assessing the matter, is skeptical that the companies can be compelled to abondon their valid contracts. Even inducing them to do so will require major financial concessions by the city, and some of that money is likely to make its way into the pockets of the current limited partners.
The better course of action might be to proceed with negotiations on the renewal of duty Free's contract, which expires in 191. The city should demand that minority and women participants be actual subcontractors, with day-to-day responsibilities, rather than limited partners. Using that agreement as a model, Host, which is interested in the subcontractor approach, might want to renegotiate its deal now rather than face what might be stiffer terms in 1993, when its current contract runs out.