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Not for Sale



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9 opinions continue to fall on the side of denying sole-source due to the increasing number of competitively bid O&M services, a time could come where the competitive precedent will be so overwhelming that few legal opinions could justify sole sourcing at all. If this were to occur, it would be a major paradigm shift in APM O&M contracting. Informal discussions with major APM O&M providers reveal that they are aware of this possibility. 3.1.2 O&M Contract Durations As noted in Chapter 11 of ACRP Report 37, historically the Photo: www.bombardier.com typical time period for initial O&M services has been 5 years. Typically, renewals of the contract for continuing O&M services Multiple Trains in Maintenance Facility at HartsfieldJackson International Airport have also been 5 years. Recent contracts for continuing O&M services, either competed or sole sourced, have been longer. Some examples include a base contract of 5 years with option mission, board, or council. Regardless of the particulars, years that can be approved for a total contract duration of each has legally empowered governmental authority and up to either 7 or 8 years. Other examples have a base contract is an entrusted curator of public money. As such, the most of up to 8 years. One example has a base contract of 10 years. common contracting method used by airports is designbid These longer durations ease the administrative burden on build, also known as competitive public low-bid contracting, airport authorities simply because they need not engage in the where the contract award is ultimately based on competing contract administration work necessary to extend the O&M bids with the lowest price constituting the winning bid. This services as often. If the services are put out for competition, is arguably held as the most effective measure of protecting this contract administration work involved is particularly and ensuring proper and best use of public money and in substantial. most cases is legally dictated. Thus, sole-source contracting These longer durations also offer the O&M provider a without good reason and/or justification by a public entity contractual certainty that can allow it to implement capital can be construed (either legally, politically, or publicly) as investments in the APM system that are desired by the owner. circumventing public bidding laws. The terms and conditions One large airport with a large airside APM recently included by which a public entity can legally engage in sole-source provisions and funding for midlife improvements to the contracting differ by state. Some state statutes are relatively lenient, with many specific exceptions to public low-bid con- tracting that will allow sole-source contracting. Such excep- tions may involve the high tech nature or availability of the product that is being contracted (such as an APM system). Some states, on the other hand, allow virtually no exceptions to public low-bid contracting. With regard to O&M contracting specifically, legal prec- edent has allowed continuing O&M contracts to be sole sourced to the original APM supplier (in all locations where this has been legally allowed). Historically, there were excep- tions where the initial supplier had gone out of business, leaving no alternate but put the O&M services out for com- petition. Circa 2005, from the seed of these few exceptions, some legal departments opined that the very precedent of the few O&M contracts that were successfully put out for competition negated the option of sole sourcing. Within this same time frame, some airport authorities chose to put their continuing O&M contracts out for competition in the interest of seeking cost savings, thus adding to the number of precedents Photo: Lea+Elliott, Inc. for competitive O&M contracting. Although it cannot yet be Single Train in Maintenance Facility at confirmed as a future trend, the possibility exists that if legal Detroit Metropolitan Wayne County Airport