Mayor Ivy Taylor is calling for a re-do of the selection process for the multi-million dollar contract to operate the new San Antonio River Walk barge fleet, citing concerns that lobbying efforts “have tainted this process beyond redemption.”

City staff was slated to recommend San Antonio River Cruises to City Council this Wednesday as the top contender out of four companies vying for the 10-year contract, but Taylor removed discussion of the contract from the meeting’s agenda. Instead, City Council will be reviewing the application process this week with City attorneys during a closed-door, executive session.

Taylor stated in an email to City Manager Sheryl Sculley last week that she sees two options to move the selection process forward: “Scrap the existing process and issue a new RFP, or eliminate the top-ranked respondent and have the City Council interview the remaining respondents.”

There is at least one more option, sources told the Rivard Report: the selection process is reviewed, found to be solid, and the contract is awarded to the top applicant, San Antonio River Cruises.

San Antonio River Cruises is owned by Chicago-based Entertainment Cruises which has hired local attorney and former Mayor Phil Hardberger to represent the company. Taylor is concerned that because he was allowed to address the 11-member citizen selection committee as part of the company’s response to a request for proposals (RFP), the other applicants were not given a fair shot.

The current river barge operator, Rio San Antonio Cruises, is allegedly in second place for the contract. The City began the process in 2014 to purchase new, state-of-the-art barges to replace the decades-old fleet design and develop a new contract for the operator.

In an email sent to Sculley on Feb. 10, Taylor said she was “concerned about the integrity of the process” and asked Sculley to look into several questions she had about the contract and the RFP process. Taylor’s concerns were first reported by the San Antonio Express-News on Friday.

Sculley and City Attorney Andy Segovia responded to Taylor’s concerns in a Feb. 12 email.

“I am fully confident that the selection process was fair and objective given the process parameter and Legal requirements,” Sculley stated. “In short, there was nothing in the process that gave any proposal an unfair advantage over the other proposals and the scoring differential reinforces that the recommended proposal is the strongest for the City of San Antonio.”

But the mayor was not satisfied with the answers.

“…[T]he fact remains that our established processes, and the City of San Antonio Ethics regulations, do not seem to have been followed during the preparation for and delivery of presentations,” Taylor stated in a Friday, Feb. 17 email. Taylor pointed to the “last-minute” changes to the process in which City staff approved Hardberger’s attendance.

Sculley was not available for comment Monday, but responded to Taylor on Friday:

“There is no evidence to suggest that the process was purposely designed so that a specific proposal would emerge as the winner. My staff did not have a preconceived preference for the barge concession provider and most certainly did not engage in any process engineering or unethical conduct to give any proposer an unfair advantage. That conduct is not condoned or tolerated,” Sculley stated. “My staff is committed to following best practices and ethical principles in conducting any activity within the scope of the City Manager. Unfortunately, it appears that not all of the bidders have strictly adhered to Council adopted restrictions on communications for high profile solicitations.”

A “cone of silence” or blackout policy prohibits applicants from communicating with City officials. Taylor told the Rivard Report on Monday that one of her staffers was alerted of Hardberger’s “convincing” presentation, which took place on Monday, Jan. 20, by a community member.

City staff told the San Antonio River Cruises team that Hardberger’s presence would be “fine,” according to emails obtained by the Express-News.

Taylor declined to identify the member of the committee who she then spoke to regarding their concerns about his two-minute presentation.

“It’s still apparent to me that there was an issue with last minute rule changes and confusion about the role of attorneys in the presentations,” Taylor said. “The top issue is the presence of the attorney and what [their] role is. … Lobbyists are not allowed in presentations. Because of his notoriety in the community, [perhaps] no one spoke up to say it was inappropriate.

“Maybe his presence wasn’t inappropriate,” she added, “but the role of the attorneys should have been to answer questions or clarify positions of clients.”

Hardberger confirmed Monday that he made a two-minute presentation to the committee, but that it was as a “core” member of the application team.

“I’m not a lobbyist,” he told the Rivard Report. “I’ve never been a lobbyist in the past.”

San Antonio River Cruises parent company provides “dining cruises, yacht charters and sightseeing tours in Baltimore, Boston, Chicago, New York, Norfolk, Philadelphia and Washington D.C.,” according to its website. It was the company’s experience and community relations that convinced Hardberger to join the team.

His only interaction with the selection committee was during the presentation, he said, and he hasn’t talked to elected officials or City staff regarding the river barge contract.

“We’ve been totally above board, 100% transparent,” Hardberger said. “When the mayor is suggesting that you do away with the number one [applicant], yes there is some concern … but there is not concern that we’ve done anything wrong because we’re not doing anything wrong. We’re being shot at because we’re number one.

“What would you gain by starting over? We’re still going to be the most qualified in the country. That isn’t going to change,” Hardberger said. “At the very least it’s a waste of time and at the most it’s insubordination of justice – you don’t like the results so you want to do it again.”

Rio San Antonio Cruises’ 10-year contract has been extended until a new contract is awarded. Local attorney Bill Kaufman, who is working with the local company, could not be reached for comment but told the Express-News Friday that he will be monitoring the situation to see if a formal complaint needs to be filed.

“The issues of anyone bidding on any contract is fairness, and there may be mitigating facts that explain what [happened],” he told the newspaper. “But all I know is that it doesn’t appear from reports that all bidders had access to the same information.”

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Taylor said that while she has worked closely with Kaufman in the past, that has “absolutely nothing” to do with her concerns.

“I don’t care who gets the contract except that we have a vendor that can do a good job and represent the city,” she said. “I don’t even know what team he’s working on.”

Taylor recognized that a new or revised RFP process could throw off the desired timeline for new barge operations to begin by the City’s Tricentennial in May 2018, but stressed that it’s more important that the rules are followed and the best operator is selected.

“I really want to get a pulse from my colleagues,” she said of the executive session slated for Thursday.

Taylor is the first to voice concerns over the contract so far. Councilman Roberto Treviño (D1) isn’t opposed to reviewing the RFP process, he said, but there isn’t enough evidence of wrongdoing for him to make accusations.

“If we messed up [on procedure], then let’s fix it,” he said, but he would like to see some clarity in what the concern is: the role of an attorney in the selection process, Hardberger’s notoriety, or that a non-local company was selected?

“When you say you want a fair, transparent, inclusive process …. that means that it’s open to all,” he said. “The minute we start picking and choosing who can be part of it, that’s not a fair process.”

Councilman Ron Nirenberg (D8), who is challenging Mayor Taylor for her seat in the May 6 general election, called Taylor’s accusations “hard-charged,” “reactionary,” and “very troubling.”

Nirenberg and Taylor have faced off on a number of issues involving transparency in the past few years.

“The charges that she’s levying stain San Antonio,” he said, “and so she better darn well have some evidence that can help us substantiate her claims because it sends a horrible signal to any company wanting to do business in San Antonio.”

Iris Dimmick

Iris Dimmick

Senior reporter Iris Dimmick covers City Hall, politics, development, and more. Contact her at iris@sareport.org