AMR claims San Diego fire chief's grudge tainted contract bidding process

A letter from AMR protesting the city's plans to change ambulance services alleged a conflict of interest after AMR fired the chief's son


Jeff McDonald
The San Diego Union-Tribune

SAN DIEGO — The fight over who will provide ambulance service in the city of San Diego has grown more testy, with lawyers for longtime contractor American Medical Response now accusing the selection committee of having a conflict of interest.

In a sharply worded protest letter this week, AMR claims a San Diego fire chief improperly scored AMR's proposal because of a grudge he held against the company for firing his son several years ago.

"This glaring conflict unfairly disadvantaged AMR and has poisoned all the work of the selection committee," AMR lawyer Pamela Johnston wrote. "This error tainted the entire (bidding) process."

AMR is requesting that the city vacate its announcement earlier this month that it plans to award the contract to the Falck Group, a Dutch conglomerate and one of the largest private ambulance companies in the world.

City officials declined to respond to allegations raised in the Aug. 24 protest letter, which also renews a series of complaints and allegations AMR brought forward late last year.

In a statement, a spokesman said the city's contracting rules allow unsuccessful bidders to file protests against notices of intent to award a contract.

"The city will review the protest we received and issue a written decision prior to awarding the contract," the statement said.

The December complaint, which also asserted that the 2019 bidding process was improper, resulted in a new round of competitive solicitations that led the city to again choose Falck. It also questioned Falck's response record and financial position.

Most public contracts are required to be put out for competitive bidding to ensure that taxpayers do not overpay for specific goods or services. The bids are typically evaluated by a committee of experts and the bids are independently scored, with the highest qualifying score selected.

Troy Hagen, the chief commercial officer for Falck USA, the global company's American subsidiary, said he is grateful to have been selected each time after fair and transparent bidding processes.

"Falck is prepared to move forward on our partnership with the city and the San Diego Fire-Rescue Department," Hagen said by email. "As one of the world's largest and oldest companies providing ambulance services, Falck has the experience and resources to meet the unique needs of San Diego."

AMR has held the San Diego ambulance contract for decades. The latest agreement was set to expire at the end of June but was extended for two years this spring as the two bidders competed for the future work.

But language in the two-year extension allows the city to switch providers before the new contract expires in June 2022.

The deal also included a "lame duck" provision to help ensure a smooth transition if San Diego eventually chooses a different provider to replace AMR. The contract also calls for AMR to continue serving the city for six months after a provider is selected.

The current provider warned that its competitor may not be able to hire and train enough qualified employees.

"This is a risk that the city, and its residents, should not be required to bear," AMR said. "The city should seriously question Falck's staffing assumptions and the scoring on this point by the selection committee."

San Diego city firefighter-paramedics typically respond to emergency medical calls, but patients are transported privately. AMR had been paying the city $10.7 million a year for the right to operate the ambulance service.

Because the company is privately held, no information on revenue from patient billings is publicly available. However, the protest letter advises city officials that AMR's current assets of $1.3 billion are more than double its existing liabilities.

The latest protest lodged by AMR said the fire chief whose son had been fired by the company wrongly affected the eventual scoring. Out of 100 points, AMR received 1.5 points lower than its competitor.

"There were likely several internal agency strategy sessions, interviews and negotiations where (the chief) interacted with other applicants and gave his thoughts to the other selection committee evaluators," the AMR lawyer wrote.

"He may have even shared details regarding his son's termination with the other selection committee members," she added.

Johnston stopped short of threatening to litigate the city's latest decision if the scoring process is not reevaluated.

But she did cite a 2016 U.S. Supreme Court ruling that overturned a Pennsylvania decision reinstating the death penalty against a murder defendant because the former prosecutor had been promoted to the state's high court and did not recuse himself.

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©2020 The San Diego Union-Tribune

McClatchy-Tribune News Service

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