Two years after the French Market Corp. canceled a controversial deal with a private firm to manage three city-owned parking lots and auditors accused that contractor of overbilling the city agency, the French Market is seeking in court to recoup what it says it lost.
Meanwhile, that same contractor, SP Plus Corp., continues to collect cash from Mayor Mitch Landrieu’s administration under a separate contract it received months after auditors questioned its dealings with the French Market.
One critic says the second contract, which the city awarded before the French Market’s lawsuit was filed, is a clear symptom of the city’s right hand being out of touch with its left.
“If you were running a business and you had one firm that you sued for theft, why would you award a contract to that firm?” said Jim Huger, a rival parking lot operator who first decried SP’s billing practices in 2013 when the board of the French Market Corp. initially tapped SP to manage the three French Quarter lots.
But a city spokesman said the French Market’s parking lot management contract and the city’s automated parking meter management contract cover distinct services and were awarded under different circumstances.
The city in 2014 chose to retain longtime vendor SP to manage the parking meters after a “competitive and completely transparent” bidding process, spokesman Hayne Rainey said. Embedded in the contract are safeguards against shoddy management, he said.
However, the French Market’s lawsuit, filed more than a year ago but little publicized until now, raises questions about SP’s financial practices.
The suit said SP, formerly known as Standard Parking, charged the French Market for home office, travel and other personal expenses, and even for the price of a car. It said the firm also double-billed the French Market for services it did not perform and for employees who did not work at the three parking lots in and near the French Quarter — all in violation of its contract.
Much of the suit parallels what the auditing firm Pailet, Meunier and LeBlanc LLP reported when it examined Standard’s 2012 performance under the French Market contract and found more than $130,000 in questioned expenses. The firm released its findings to the French Market in February 2014; that same month, the agency’s board terminated its agreement with SP.
Four months later, the city awarded SP the contract to replace and update parking meters. And seven months after that, the French Market sued SP to recoup its losses.
SP responded that any alleged losses were due to French Market representatives’ negligence or deliberate mistakes. It dismissed the rest of the French Market’s claims. That case remains pending in Orleans Parish Civil District Court.
Under the city’s parking meter contract, however, there are safeguards to block both operational and fiscal mismanagement, Rainey said. When SP fails to timely repair meters — as was reported to be the case before the city renewed its contract in 2014 — it must pay the city for each unrepaired meter. The contract requires SP to annually reconcile its books and “immediately correct any overpayment or underpayment” for which it is responsible.
Rainey said the SP proposal “was determined to be the most advantageous to the city based on their technical competency, performance history, knowledge and experience of their implementation team, and DBE participation plan.”
The French Market contract was mired in controversy. Huger, who also bid to operate the French Market lots, accused the agency’s interim director, Ann Duplessis, of trying to steer the contract to SP after she tacked on more than $178,000 in expenses to his bid without his knowledge. He also accused SP of overcharging the city.
Landrieu and the agency’s board ultimately scrapped the bid, wanting to avoid the appearance of impropriety. A year after doing so and after receiving the audit on SP’s performance, the French Market board elected to manage the lots itself.
“Meanwhile, the other side of the city is awarding them a street meter contract. It just doesn’t make any sense,” said Huger, the owner of Premium Parking.