WILL POLITICAL GRUDGE ON CITY COMMISSION AGAINST COMPANY END UP COSTING TAXPAYERS MILLIONS?

(Those of us who are acquainted with our critical coverage of Brownsville-based American Surveillance know we have been often given space here to those who have complained of the company's aggressive campaigns to garner security contracts with the local municipalities, school districts, police departments and surrounding entities, including the Port of Brownsville. Critics like to allege that the company's owners employ behind-the-scenes maneuvers and politics to land contracts. Its owner is Jaime Escobedo, brother of Brownsville Independent School District board president Enrique Escobedo. That's well and good, but absent any hard proof of criminal wrongdoing, we took a look at the recent move by the Brownsville City Commission to table the security contract instead of following the city administration's recommendations to award it to the lowest bidder and procuring the best deal for the city. The question now becomes, will a political grudge on the city commission result in more than a $1 million hit on the city taxpayers for start-up costs associated with an in-house security detachment? Crunch the numbers and judge for yourselves.)       

By Juan Montoya
If you've had occasion to visit municipal court or any of the city's libraries, you will probably notice that the security guards at the facilities are different people than before.

Instead of the experienced security guards and personnel of before, the new guys are obviously younger because most are students attending the city's police academy.
Until this past September, when the Brownsville-based American Surveillance company had the city contract to provide the services to some 20 city facilities ranging from parks, the airport, city cemetery, the land fill, municipal buildings, etc. you could spot their personnel making their rounds in their familiar navy blue uniforms.
In fact, American Surveillance has provided the city with the services since 2010 when it landed the contract as the lowest bidder. The price tag of $821,271 that the city was paying the year before was lowered with the signing of that three-year contract to $766,474. In the contract provided to city purchasing, the company figured in a discount of $54,796 a year multiplied times three over the term of the contract for a realized savings of $164,389 over the 2011-2013 term.

The contract also sates that the city had the option of renewing the contract with American Surveillance for two additional years if the commissioners approved it.

The city bids out these public-facility security contracts to private vendors because if it used police officers to perform the same service the costs would be prohibitive since police officers are covered by union wages and overtime rates as well as steep wages for supervisory personnel. This, plus the fact that the city needs more officers, makes the idea of using police to provide security fiscally untenable.
This year, according to city records, the bidding process for the security services started way back in June 23 when the city advertised and solicited formal sealed bids. It also posted the call for bids on the security contract on the city's website on June 30. A total of 49 companies received an invitation to participate and 26 companies downloaded the bid package on the Texas Bid System website. A pre-bid conference was held July 2 and again July 9. Six vendors attended the conferences, and nine sealed formal bids (two were declared unresponsive for lack of information) were delivered for the city commission consideration.
The two companies whose bids were declared unresponsive were Valley Wide Security of Brownsville, and Hi-Tech Security, also of Brownsville.
The six surviving companies were International Protection Inc and Coastal Security, of South Padre Island, Vets Securing America, of San Antonio, Taylor Security Group, of Ft. Worth, American Investigations, Brownsville, American Surveillance, of Brownsville, Bolt Security, Edinburg, and Border Protective Security of Indian Lake.

(Click on graphic to get a clearer view of the tabulations by company).

Of these, staff recommended that the security contracts for 12 different items be awarded to five companies and ranked them as Level 1, "primary vendor," Level 2, "secondary vendor," and Level 3, "tertiary" vendor. The level was determined on a net-unit cost basis, with the lowest unit cost awarded the Level 1 status, next lowest unit cost Level 2, and so on. If the Level 1 vendor is unable to provide the security services when directed by a city department, then the next level will be enlisted to provide security services as listed on the tabulation sheet.
A cursory review of the bid tabulations and staff recommendations reveals that American Surveillance was the Level 1 Primary vendor for 10 of the 12 categories. The closest competitor was Border Protective Security, of Indian Lake. Even then, the differences were small, just 37 cents per hour in the armed emergency responses component in item 11, and 52 cents per hour in the unarmed emergency response component in item 12.
In fact, in light of the city administration's reduction of hours for security of the municipal facilities, invoice records show that American Surveillance's billing was less than $600,000 per year, a far cry from the $800,000 the city was paying when the company first took over the contract. A review of the bids for the 2013 contract that was tabled indicated that America Surveillance had actually lowered the annual costs by some $40,000 more for the term beginning this year.

One would think that given American Surveillance's competitive rates in the 10 items categorized by the city, the fact that it had lowered hourly costs per year, was the lowest bidder, and it being a Brownsville-based company would make it a shoo-in for the contract.  

But something went awry.
Instead of picking the low bid and awarding the contract to the company, the item – upon motion by Commissioner Jessica Tetreau, seconded by Commissioner Estela C. Vasquez – was tabled by the following vote:
Ayes: Commissioners E. Vasquez, J. Tetreau, D. Portillo, R. Gowen, and Mayor Martinez
Nays: Commissioner J. Villarreal.
In the minutes of that meeting, the commissioners moved instead to provide the security to the 20-odd city facilities in-house. That means that city employees or students at the police academy, will be providing the security. No one knows exactly what cost will be borne by the city – health insurance, liability, clothing allowance, etc. – but when commissioner Ricardo Longoria inquired as to availability of funds for said services, Pete Gonzalez, Deputy City Manager, responded that the project was approved by city management and funds were allocated to each department where security services would be required.
Then, in the reverse of the motion to table the item, commissioner Vasquez, seconded by Tetreau voted to close the public hearing.
Now, from this vantage point, it appears that the purchasing process was followed by both the city and the vendors in this case. So why did the city decide to shoulder the additional load of providing security in-house after it had put out the services for bids?
We know there has been bad blood between some city commissioners and the owners of American Surveillance – commissioner Tetreau is one – over a previous controversy where she claimed that one of their operatives helped her former opponent Charlie Atkinson install surveillance cameras to prove she did not reside in the district for which she was running.

If the city merely matches the cost that a private security company charges a year ( $821,271 in 2010), that is yet another hit on the city budget. Remember, that figure does not take into consideration the other start-up costs associated with using in-house personnel like equipment such as cars, four-wheeled vehicles health care, retirement, FICA, insurance, supervisory salaries, etc. It will easily top $1 million per year that the taxpayers of the city will have to bear.
City management can do nothing but operate the purchasing process and make recommendations that the City commission might follow. The bidding process stated in June and the vendors made their bids in good faith. Did the city commission have this in mind already and just went through the motions to pay lip service to the process knowing they would do something else? Or did the wrong vendor win and a majority decide that they would rather spite their face by cutting off their noses?
Either way, there are now 30 people that were employed by American Surveillance out of a job and 30 families without income. Have the taxpayers been made the scapegoats to pay for a political grudge?