Surely, you’re familiar with no-bid contracts in Iraq. The United States federal government and its armed forces awarded numerous reconstruction and basic services contracts with no open competitive bidding processes during the early years of the Iraq War.
The most notorious beneficiary of these no-bid contracts was Halliburton and its subsidiaries, to the tune of over a billion dollars. There are hundreds of articles on this subject.
You may also be familiar with the City and County of San Francisco’s infamous Municipal Railway (MUNI).
Just like Halliburton in Iraq, MUNI is the sole beneficiary of a yearly no-bid contract by the City since its inception in the early 1900s. “Now, just wait a second,” you say, “MUNI isn’t awarded a contract by the City government, they are the City government!” It’s that sort of thinking that has led us down a path of poor service and general transit incompetency.
MUNI operates as a government funded entity set out to perform transit related duties on behalf of the City and County of San Francisco. Soon after the 1906 earthquake the City thought these duties would best be performed by a City-owned entity, so they gobbled up commercial competitors. Now our City transit is operated just like our friendly firemen and police officers you see everyday on our streets.
The theory is that collecting tax from all residents of the City is the only way to support the significant cost of building and maintaining an effective City-wide transportation system. THIS IS TRUE.
But, in practice, this theory has extended such that the City believes the only way to run a transportation system is to be a sole operator. THIS IS NOT TRUE. AND, it has had a destructive effect on our City’s transportation infrastructure.
We erode effective transit reform by thinking of MUNI as being integrated with the City government. If we think of MUNI as an independent transit operator (that just happens to be owned and operated by the City), we can then free our mind to view things as they truly are: MUNI is the sole beneficiary of a yearly no-bid contract by the City since its inception in the early 1900s, just like Halliburton in Iraq.
But, it gets worse.
With Iraq, the United States federal government had a couple of good arguments for using Halliburton without competitive bidding open to other entities. Halliburton takes care of business. Said one USAID spokesman, “If you need a surgeon, a lawn service, a real estate agent or a college, you seek out the names with the reputation for quality and the ability to get the job done.” (Source) Halliburton may be expensive, but they take care of business. MUNI does NOT take care of business. (1) (2) (3) (4) (5) (6)
In Iraq, the feds were faced with an immediate crisis and had no time for a 6-month competitive bid. In San Francisco, MUNI has been suffering from a severe decline in quality over decades. The City’s own internal auditing teams reported numerous quality control issues over ten years ago.
How do we fix MUNI? We need to get rid of it. It’s easier to shoot the horse. MUNI is so ingrained with bad operations, expensive labor, no accountability, etc that it has grown to be a monster. It’s a monster fed by our City government.
How do we get rid of MUNI? Baby steps. Let’s start with easily defined, necessary transit projects, such as the new Bus Rapid Transit lines. Let’s have an open bidding process for operators. An operator will have a reasonable opportunity to make a profit on operations if it is an efficient operator.
This structure will also put strong pressure on City transportation planners to consider truly transit-first options, such as true signal preemption for the BRT lines. A project will have higher value for the City (aka lower operating cost bids) if it is TRULY transit first.
Let’s stop feeding the MUNI monster.
UPDATE: Greg at the N-Judah Chronicles has a nice piece about the proposed salary increase for MUNI Chief Nathaniel Ford. Come on, City, don’t be so stupid as to award high salaries with NO tie to performance. You’re ridiculous.