In 2008, the Metro Nashville Airport Authority (MNAA) awarded a public-relations/advertising contract to Nashville PR firm McNeely, Pigott & Fox (MP&F), rejecting bids from Dye, Van Mol & Lawrence (DVL) and five other firms.
DVL had held that contract for seven years and, according to MNAA, had performed well.
Below is a NewsChannel 5 analysis of what MNAA and MP&F say about how the politically connected PR firm won the contract:
MNAA says "MP&F won the contract on the merits, through the competitive bid process. It was a difficult choice. But MP&F won based on their experience, their response to the RFQ and their performance in the oral presentation."
The Airport Authority issued a Request for Qualifications (RFQ) for the public relations contract on February 28, 2008.
That's the same day that the Metro Development and Housing Agency issued a Request for Proposals (RFP) for the public relations contract on the proposed convention center.
An RFQ is a process through which firms are normally pre-screened to ensure that they are qualified to compete for a government contract. Unlike the RFP process, an RFQ does not require consideration of the costs of the service. Instead, a vendor may be selected for later negotiations of price.
In its RFQ, MNAA indicated that the competing firms would be judged on 11 criteria. However, when the written proposals were submitted, airport officials used just four of the categories. MNAA spokesperson Emily Reynolds says they focused on the criteria that were "most pertinent and material." Among the criteria not used in the evaluation was the firms' "proven and demonstrated ability to meet deadlines and stay within budget."
A four-person evaluation committee of MNAA personnel reviewed proposals submitted by seven firms and gave each scores on the four categories.
(MNAA supplied NewsChannel 5 Investigates with what it says was the summary sheet for the scoring -- the first page in this .pdf document -- and scoring sheets from three of the four evaluators. All the numbers are identical, except for one category on one vendor. Those numbers do not add up when compared to the summary sheet. Reynolds says the scoring sheet by the fourth evaluator was not retained in MNAA's files. She claims the Airport Authority does not know which evaluators filled out which scoring sheets.)
Three firms -- McNeely, Pigott & Fox, Dye Van Mol & Lawrence, and Seigenthaler Public Relations -- were chosen for the final round of evaluation based on oral presentations and submission of creative samples. There was no written criteria for that last round of judging, no score sheets and no documentation of how MP&F was chosen for the contract, other than a recommendation letter. Airport officials says they "liked" the firm's presentation the best.
A nationally recognized government procurement expert told NewsChannel 5 Investigates, "Talking about a lack of transparency, that's a lack of transparency."
MP&F senior partner Mark McNeely says his firm's contract with MNAA "is not hourly. It is a fixed monthly fee."
MP&F's contract states that the compensation shall be an amount "not to exceed $30,000 per month, which includes time and materials."
That amount came from McNeely's suggestion of a proposed fee structure in a memorandum to the Airport Authority: "The client agrees to pay to McNeeley, Pigott & Fox up to but not exceeding $30,000 per month, against which we will charged (sic) MP&F hourly rates of $300 for partners, $225 for vice presidents, $200 for senior account supervisors, $175 for account supervisors, $155 for senior account executives, $115 for account executives, $90 for assistant account executives, $70 for associate account executives, $60 for staff associates, $155 and $100 respectively for art director and graphics producer, $155 for information services director, $60 for proofreader and $50 for other staff...."
However, the final contract leaves it up to MP&F to calculate how it gets to the $30,000 cap.
Still, our investigation discovered that MNAA paid $30,000 to MP&F in both November and December 2008 - even though it did not actually reach the cap for those months. Invoices show the firm's total costs for time (at rates up to $300/hour) and materials were $27,603.90 and $29,782.27, respectively.
In addition to $360,000/year in possible monthly fees, the contract also allows for MP&F to bill an extra $40,000/year for unspecified "special projects." No such fees were charged in 2008-2009.
MNAA and MP&F say that, in 2008-2009, the firm provided $168,000 in uncompensated services above the $30,000 monthly cap.
That's a reflection of MP&F's hourly rates. If the firm's hourly rates were lower, it might not have exceeded the cap and the amount of uncompensated services would not have been as high. Again, MNAA's contract leaves it up to the firm as to how it gets to that threshold.
Those hourly rates allow the firm, which denies that it provides services on an hourly rate, to make a public-relations claim that it provides a substantial amount of services free of charge.
Mark McNeely insists that his firm got no better deal than its predecessor, Dye Van Mol & Lawrence (DVL). Despite the $30,000/month deal, "it's the same contract," McNeely says.
Because the contracts are structured differently, an apples-to-apples comparison is difficult, if not impossible.
DVL's contract provided a flat fee of $10,000 per month for its basic services. DVL invoices indicated that, based on hourly rates of up to $190/hour, it provided uncompensated services of $41,000 during the last 12 months of its contract with MNAA.
However, under its contract, DVL was allowed to bill extra for creative services for advertising and for special projects.
An independent NewsChannel 5 analysis puts DVL's professional and creative fees at just over $17,000 per month - compared to MP&F's $30,000. (The Airport Authority estimates that, on average, DVL's fees were $20,417 per month. That estimate includes substantial printing costs and television production costs, which MP&F is not required to absorb as part of its contract.)
MP&F says it is required to pay minority vendors and other costs out of its $30,000 per month. DVL also paid minority vendors out of its $10,000 monthly fee. As part of costs that MP&F incorporates into its monthly fee, it includes charges of 20 cents for every page it copies, 75 cents for every page that it faxes.
Also, MP&F says it does not charge the airport for coordinating advertising placement - denying it a potential source of revenue available to DVL for part of its contract.
DVL did not always have responsibilities for buying advertising time. In addition, MNAA has dramatically slashed its ad budget. MP&F's invoices show it still charges at rates up to $300/hour for ad buys.