AMR alleges conflict of interest in battle over contract with Calif. fire district
Among AMR’s complaints against the Sonoma County Fire District is that the district lowered the transport cost by paying EMS employees less
By Martin Espinoza
The Press Democrat
SONOMA COUNTY, Calif. — For more than two decades, AMR ambulances have dominated the streets and highways of Sonoma County’s urban core thanks to an exclusive contract worth tens of millions of dollars a year.
That dominance, at least in Sonoma County, ended late last month when local officials essentially dumped American Medical Response and awarded the lucrative contract to the rapidly growing Sonoma County Fire District, which promises a significantly lower ambulance transport cost for patients and insurance companies.
But AMR is not ready to bow out so easily.
On April 28, AMR, locally known as Sonoma Life Support, challenged the county’s decision through an official protest that alleges the county’s competitive bidding process was skewed in favor of the fire district, tainted by conflict of interest and conducted in a way that was inconsistent with the state constitution.
Key among AMR’s objections is that one of the people on the review committee had ties to a nonprofit that received a $10,000 donation from a rival ambulance company that is partnering with the fire district.
AMR also alleges the fire district improperly influenced the county’s decision through a media campaign that violated the bidding process “gag rule.” The company also raised concerns that the fire district’s revenue plans may violate the state Constitution “by imposing an illegal tax.”
“There was a clear conflict of interest,” said Jason Sorrick, an AMR spokesman. “If that is not justification for throwing out their bid, I am not sure what is.”
Earlier this week, the fire district fired back with a lengthy response to AMR’s protest, claiming it is “without merit” and that accusations of conflict of interest are “demonstrably false and legally spurious.”
“We stand by our response to AMR’s bid protest which clearly demonstrates that there is no problem and no disqualifying conflict,” said Sonoma County Fire District Chief Mark Heine, in an email.
Heine played down AMR’s protest, saying there is no conflict over local ambulance services. He said there’s an established “administrative process” to deal with AMR’s challenge.
“The county’s procurement process has an identified procedure for unsuccessful bidders to challenge the outcome,” Heine said. “All of our emergency services agencies continue to provide excellent service while the county facilitates the protest period.”
Still, the stakes are high in the battle for the right to operate ambulance and EMS dispatch services in central Sonoma County, with annual revenues projected at between roughly $25 million for AMR and $30 million for the fire district, according to their bid proposals.
In one corner is the country’s largest ambulance operator, which says it’s made huge investments in the county’s EMS system. And in the other is an ambitious new fire district that, through a series of consolidations since its formation in 2019, now covers Windsor, Rincon Valley, Bennett Valley, Bodega Bay, Guerneville and Forestville.
AMR’s protest is the latest chapter of the county’s ongoing dispute between public EMS providers, such as fire agencies, and private operators, each claiming the county’s contract has unfairly benefited the other.
In the past, the fire district has said the county’s requirements and criteria for scoring proposals favored established ambulance companies and disadvantaged newcomers. Now, AMR is essentially alleging that the latest bidding process favored the fire district and was rigged.
Conflict of interest?
Foremost among AMR’s objections to the county’s bidding process for the exclusive ambulance contract is the role of one of the members of the committee that reviewed proposals. In its April 28, 16-page protest letter, AMR holds that Amy Gnojek, a certified public accountant and EMS consultant, had a “disqualifying conflict of interest that infected the entire RFP process.”
Gnojek has ties to an organization called Women in Emergency Services, or WiES, which prior to the bid award received a $10,000 donation from a subcontractor in the fire district’s proposal. WiES’s website lists Gnojek as a “founding advisor.”
“After we got the results, we looked at who the reviewers were and realized, wow, that is a clear conflict of interest,” said Sorrick, the AMR spokesman.
Sorrick said the fire district, in its bid proposal, indicated that it planned to partner with WiES, a nonprofit organization that supports women’s careers in emergency services. The fire district’s bid states that it will use WiES as a vehicle to “match mentees with experienced mentors,” including the subcontractor.
Gnojek, reached via email Friday, said she has not seen AMR’s protest letter but has read what she described as “one-sided” media coverage about the ambulance company’s objections.
Gnojek said she is a volunteer, unpaid advisor to WiES and has no financial interest in the organization. She said she does not have any control, influence or duties in or over the organization’s management or fundraising activities. And she rejected any suggestion that the timing of the donation was aimed at influencing her work on the committee.
“In fact, (the subcontractor’s) contribution was self-pledged in January 2023 directly to WiES staff and paid in full in March 2023,” Gnojek wrote in her email. “The selection review committee heard presentations in April 2023, with all members of the review committee remaining anonymous to all respondents.”
The fire district, in a 36-page response to AMR’s protest, outright dismisses the conflict of interest charge as speculative, “contrary to the facts, the law and common sense.”
The fire district writes that its subcontractor, Medic Ambulance Service, never had any contact with Gnojek and that its representatives did not know Gnojek. They also didn’t know she was on the review committee until April 25, the day after the contract was awarded because the county never disclosed committee members’ identities.
“Medic’s and (Sonoma County Fire District’s) support of WiES reflects their commitment to and support of, women in the EMS and ambulance industry,” the fire district’s response states. “AMR’s efforts to tarnish and trivialize the beliefs and efforts of WiES, Ms. Gnojek, Medic, and SCFD should be seen for what they are: a cynical attempt to preserve the status quo contrary to the values of Sonoma County communities.”
Cost and compensation
The fire district’s response to AMR’s protest states that the private ambulance company failed to show it was “aggrieved or prejudiced” by any alleged procurement errors. The fire district argues that nothing in AMR’s protest changes the fact that the private ambulance company scored lower in the bidding process because it wanted to charge patients more than the fire district for the same service.
Citing figures in both proposals, the fire district said AMR proposed charging “about $1,200-$1,300 more for representative ambulance transports than SCFD.” The fire district lists an ambulance rate of $3,100 vs AMR’s rate of $3,900 for advanced life support.
AMR’s Sorrick said the fire district achieves a lower rate by lowering compensation for ambulance operators. Sorrick pointed to a protest letter submitted by United EMS Workers Local 4911, which represents its local ambulance workers. The union argues that the fire district’s subcontract with Medic calls for wages and benefits that are lower than what it currently has in its collective bargaining agreement with AMR.
In response, the fire district holds that the union has no standing in the dispute and that its “mistaken belief” that AMR’s compensation package is better than Medic’s is based on “misleading numbers supplied by AMR in its proposal.”
Exclusive or not?
Since 1991, the county has granted an exclusive contract for ground ambulance services covering a geographical area that includes Santa Rosa, Sebastopol, Rohnert Park, Cotati, and the surrounding unincorporated areas. The area includes about 250,000 residents, about half the county’s population.
AMR or one of its forerunners has had the contract since exclusivity was granted, winning renewals in 2000 and again in 2008. The 2008 agreement underwent a series of extensions in 2011, 2013, 2019 and 2022.
AMR contends, however, that the 2022 extension was negotiated in bad faith because the county violated the contract’s exclusivity by allowing the fire district to provide “backup, standby and/or mutual aid basis” in AMR’s service area. The county made those arrangements as part of a settlement in an unrelated lawsuit with the fire district.
On March 29 of this year, AMR filed a lawsuit against the county alleging, among other things, that the settlement led the state to declare AMR’s operating area territory was no longer exclusive because the county had failed to conduct competitive bidding, a requirement for exclusive operating zones.
“Our position is that the agreement is invalid because they did not deal in good faith with us when we negotiated that (2022) extension,” Sorrick said. “They did not have exclusivity, which is what we are contracting for.”
Heine, in an emailed statement, pointed out that AMR’s lawsuit against the county does not name the fire district, or any other local, public fire agency.
“If the county and AMR cannot reach an out-of-court settlement, what I can say is we respect the judicial process and have confidence that the various issues of law and fact will be fairly adjudicated,” Heine said.
AMR’s protest is currently under review by the county health services department, which through the Coastal Valleys EMS Agency oversees the local emergency medical services system.
On Friday, Tina Rivera, director of health services, said the county purchasing office, in its review, is following the “normal protest process.”
“Once a decision has been made and a formal response is provided to AMR, we will make the appeal and response documents available to the public,” Rivera said in an email.
“We have no other comment to make at this time other than to say that the county takes these matters very seriously and is committed to ensuring that this protest review, as well as the process for awarding this contract, is fair, complete and impartial,” Rivera said.
(c)2023 The Press Democrat (Santa Rosa, Calif.)
Visit The Press Democrat (Santa Rosa, Calif.) at www.pressdemocrat.com
Distributed by Tribune Content Agency, LLC.