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City running in circles over golf cart contract

The L.A. parks department has taken bids three times in six years. Just when the current process seemed near completion, the City Council asked for more review.

August 30, 2009|David Zahniser

For those who fear that government always moves at a glacial pace, the city of Los Angeles may be poised to provide a new poster child: golf carts.

The Department of Recreation and Parks has tried three times in six years to hire a company to rent out electric carts at the city's seven 18-hole golf courses. Yet even that relatively mundane service is a source of discontent for high-paid lobbyists, labor activists and political operatives.

Search panels have been convened. Walk-throughs have been held at the Griffith Park "cart barn," where the current city vendor shelters vehicles. And three different bidding processes have been initiated -- one in 2003, another in 2006 and a third in 2007.

That third competition could finally wrap up next week, when the City Council will be asked to vote on a 10-year contract with Sherman Oaks-based Ready Golf Centers. Or that plan could be scrapped if objections from a powerful employee union and a longtime city contractor are successful.

Service Employees International Union Local 721 has been calling for the contract to be rejected on the grounds that its own members are capable of performing the work. "We want them to do it over," said Julie Butcher, the union's regional director. "Our preference . . . is for Recreation and Parks to decide that they can do this work themselves."

The fight over the golf cart contract offers lessons for Mayor Antonio Villaraigosa, who hopes to secure tens of millions of dollars to address the city's budget crisis by leasing out city-owned parking meters and parking structures. Although the golf cart concession is comparatively small, generating less than $2 million per year, it has become the subject of intense politicking.

The first search was abandoned in 2005 after the SEIU said it deserved a chance to compete. The second was canceled after the department concluded that too many bidders had failed to include women- and minority-owned subcontractors.

In the latest round, Councilwoman Jan Perry favors the current city contractor, J.H. Kishi Co., which has held the concession since 1991 but came in second in the search process. Villaraigosa's appointees on the Recreation and Parks Commission want Ready Golf, which was named the top candidate by a panel of municipal golf officials from Pasadena, Santa Barbara and elsewhere.

The commission voted to award the contract in June 2008. From there, it was studied for 13 months by the mayor's office and the city's top financial analyst, said Kevin Regan, assistant general manager of the parks department.

During that process, Villaraigosa's lawyer, Thomas Saenz, requested three meetings with Ready Golf, said the company's lobbyist, Jerold Neuman. When the proposal reached the council on Aug. 11, members decided to ask a three-member committee for more review.

"Kishi has a long record of service, dating back to when Mayor [Tom] Bradley was in office," Perry said. "I think they should be given great weight and consideration because of that."

To make its case at City Hall, Kishi has relied on lobbyist Harvey Englander and lawyer Michael Yamaki, an appointment secretary to former Gov. Gray Davis. Ready Golf, in turn, retained two sets of lobbyists -- John Ek and the law firm Allen Matkins, where Neuman is a partner.

Meanwhile, golfers are appalled by the deteriorating state of the existing Kishi carts, whose replacement has been delayed by the lengthy search process. Some of the carts pose a hazard to golfers, with brakes that fail and steering wheels that veer in a particular direction, said Rich Nance, president of the Sepulveda Men's Golf Club.

"We just want something to happen," he said. "We just want them to award the contract to somebody so we can get some new carts."

Los Angeles has four 18-hole courses in the Valley and two at Griffith Park. A seventh is in the Westside at Rancho Park.

If the council rejects the proposed contract, the parks department will probably have to spend six to 12 months conducting a fourth competitive process. Regan, the parks official, stood by the results of the current search, calling it "well prepared and well executed."

Englander disagreed, saying the city's search criteria were flawed because they put too much emphasis on his client's business plan. Kishi has more experience with the city's golf courses and will deliver a greater percentage of its rental income than its higher-ranked competitor, Englander argued.

Englander also said Ready Golf would not purchase as many new carts as Kishi. And, Yamaki said, it is unreasonable to blame Kishi for the current state of the carts.

"It's really unfair for them to be judged from a month-to-month contract, where they could be kicked out at any point," said Yamaki, a former city commissioner with family ties to Kishi.

Neuman, the lobbyist for Ready Golf, said his client would buy replacement carts more frequently than Kishi and is in a better position financially to make such purchases.

"They show only $7,000 a year in profit under their pro forma," he added. "So it's hard to imagine how you can buy a new fleet when in 10 years you're only going to make $70,000."

SEIU Local 721 has distributed a fact sheet stating that Kishi has had three fires at its cart barns and conducts all of its business in cash -- making it harder to identify potential financial irregularities. The union also pointed out that its members already operate a golf cart concession at the city's nine-hole course in Harbor City.

"It's cheaper than contracting it out because the city gets to keep all of that money," said Butcher, the union official.

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david.zahniser@latimes.com

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