LAX Concessions: Last Bidder Standing Is Wolfgang Puck Express

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Wed, Sep 8, 2010 at 7:11 PM
click to enlarge Last bidder standing
  • Last bidder standing

In the battle for the right to serve rapidly prepared food to LAX passengers, most of the attention has gone to the two heavyweights: SSP America and HMS Host.

But with both of them knocked out of the bidding by City Attorney Carmen Trutanich on Tuesday, it's time to get to know the only company still standing: Delaware North.

Delaware North is a multibillion-dollar operation that already runs a Wolfgang Puck Express and a Pink's Hot Dogs at LAX. So what is Delaware North's bold, innovative plan to revitalize the airport's food offerings?

Wolfgang Puck Express and Pink's Hot Dogs. Plus something called Rock'N Fish. Not exactly Nancy Silverton and Joaquim Splichal.

In a year or two, when you're hungry at LAX and all you can find is a Whopper Bar, you may ask yourself: "How did we get here?" Here's how.

The city received four bids for the most lucrative food and beverage package, worth about $600 million in revenues. An LAX interview panel scored them and ranked them as follows:

1. SSP (Silverton, Splichal, etc.)
2. Delaware North (Wolfgang Puck Express, Rock'N Fish)
2 (tie). HBF
4. Host (Whopper Bar)

(HBF was tossed out because its minority-owned partners were not certified to serve food. So that left three.)

Host and Delaware North protested, arguing SSP should be thrown out. Trutanich obliged, finding on Tuesday that SSP has a conflict of interest because it did work with Smart Design, which also helped design the bid package for LAX.

To maintain the pretense of even-handedness, Trutanich also tossed out Host. Fact is, Host is the big winner here. It was never going to win the contract with its last-place bid, so it has been looking for a do-over. If the city's Board of Referred Powers goes along with that, then Host will be the incumbent contractor and will keep its LAX business for at least another year or two.

And lo and behold, Trutanich has advised the Board to consider rejecting all the bids, in part because there's only one bidder left and that wouldn't look too good. So really, Host should be grateful that its proposal was thrown out, because that makes it all the more likely that the contract will be rebid.

Not so fast, says Delaware North. This plucky, multibillion-dollar enterprise sees itself backing into $600 million. In a statement on Wednesday, the company encouraged the Board to simply approve the Delaware North bid and thus "avoid years of further legal wrangling and costly delays." (If the alternative is Rock'N Fish, I'll take the delays.)

Host and SSP will likely have something to say about that. For one thing, Delaware North also did work with Smart Design. (So did Host.) In his letter, Trutanich says this potential conflict would create an "uncertain degree of risk" if the contract were awarded to Delaware North. So if the Board is looking to play it extra safe, nudge nudge, it'll throw out all the bids and start over.

Advantage: Host.

You have to hope that when Trutanich was giving free legal advice to Host's top lobbyist, it was not as shoddy as the advice he's now giving to the Board of Referred Powers.

Consider: All three bidders did work with Smart Design, but only one -- the winning one -- is disqualified for it. Ostensibly, this is done to avoid the "appearance of impropriety." Well, look. That ship has sailed.

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