Airport Isn’t Adequately Monitoring Parking Shuttles Contract
Published on August 26, 2021
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DENVER – Denver’s airport isn’t doing enough to ensure the shuttles running from the parking lots to the terminals are on time and that the company running them isn’t overcharging, according to a new report from Denver Auditor Timothy M. O’Brien, CPA.
“Poor contract oversight at Denver International Airport is a problem I’m seeing too often,” Auditor O’Brien said. “The airport’s operations are complex and expensive — making oversight, accountability, and air-tight processes even more important.”
Our audit team examined how Denver International Airport’s Parking and Transportation Section monitors its contract with ABM Parking Services Inc. We found several concerns, including:
- The shuttles for the public are late entering the parking lots so often that airport officials could be assessing the vendor millions of dollars in penalties — but they aren’t.
- Neither the airport nor the vendor is effectively monitoring customer complaints, including ones about long wait times.
- The process of awarding the airport parking shuttle contract to ABM wasn’t competitive enough.
- The airport’s single contract monitor isn’t monitoring or assessing penalties for service reliability, vehicle maintenance, employee training and appearance, safety, reporting, and compliance with airport rules and regulations.
We found an overall lack of oversight of the shuttles, which means the airport cannot ensure it is receiving parking shuttle services in compliance with the contract and it risks overpaying for the services. Additionally, airport passengers and employees who use the shuttles cannot be certain they will receive shuttle services in a timely manner.
The airport has nine parking shuttle routes: four routes for airport passengers from parking lots to the terminal and five routes for airport employees from parking lots to the terminal and concourses. ABM has been running the free-to-passengers shuttles at the airport since 1998, and before the COVID-19 pandemic, the service averaged 6.9 million passengers a year.
Parking shuttles are supposed to arrive in the East and West Economy lots for members of the public every 5 minutes. Shuttles are also supposed to arrive in the Landside and Pikes Peak lots every 10 minutes. However, the airport’s preferred system used for tracking bus locations and arrival times are unreliable and the airport’s contract monitor fails to assess whether buses are arriving on time, even during peak hours.
In fact, our audit team found the vendor failed to meet the contractual standards for arrival times every single day for more than three years. Even if the airport penalized the company for late buses only during peak hours, it still would have added up to nearly $5 million over three years.
At the time of the audit, airport managers told us they had an unofficial agreement with ABM not to assess penalties unless a customer complains — assuming every customer who waited longer than 10 minutes for a bus also took the time to fill out a formal complaint.
Even so, we looked at nearly 300 customer complaints about wait times and found airport management penalized ABM specifically for wait times only once.
“We serve the public and our community, first and foremost,” Auditor O’Brien said. “Not only should complaints be addressed promptly and fully, the airport should be more proactive in providing the best service possible without people having to take even more time out of their day to complain first.”
The airport’s Parking and Transportation Section isn’t effectively monitoring customer feedback. We found errors in tracking complaints and resolutions, as well as slow response times to customers.
By not analyzing customer feedback for trends, the airport cannot ensure positive change and other improvements that result from increasing complaints over time.
The audit team also found ABM had a significant advantage in the most recent contracting process in 2016 because the company had already been providing shuttle services for the airport for years.
Airport management did not allow enough time during the procurement process to allow other interested companies to get the buses they would need to fulfill the contract. In 2016, the airport received only two contract proposals, but three other companies declined to bid, two of them citing unreasonable procurement timelines.
New companies would have had only six months from the order confirmation date to procure a full fleet of buses when it would have likely taken up to 20 months to deliver them from manufacturers. On the other hand, AMB already had a fleet, which it bought using the hourly fees the airport paid it under its previous 2008 contract.
Reduced competition typically results in a lower value for the entity seeking goods and services. If prospective vendors or the public perceive a procurement to be unfair or inequitable, the city risks damaging its reputation through questions about transparency and fairness.
“We aren’t saying ABM did anything wrong by already having a fleet available when others didn’t, but it is airport management’s responsibility to be aware of the time needed for the procurement process and any possible perceived or real advantages they may be giving to one company over others,” Auditor O’Brien said.
We also found the airport hasn’t performed a cost-benefit analysis to determine whether outsourcing the parking shuttles is truly a better option than taking care of it in house.
Other areas of concern included the lack of a competitive process for procuring one of the bus tracking systems, which itself regularly has errors in reporting data about bus timeliness.
The airport’s contract monitor should also be keeping track of bus drivers’ shift limits, bus inspections, drivers’ certifications and training, as well as background checks. Although we didn’t identify any examples of safety issues or underpaid drivers, airport officials cannot ensure these risks never materialize because they aren’t watching for them.
The airport also needs to monitor for overbilling hours of service, overbilling for new fees, errors in invoices, and ABM’s compliance with contract requirements.
The airport agreed with all but one of our recommendations.
AUDITOR TIMOTHY O'BRIEN, CPA
Denver Auditor's Office
201 W. Colfax Ave. #705 Denver, CO 80202
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