City awards clout-heavy firm towing contract, again - Company linked to Daley pal has held the job for 20 years

City awards clout-heavy firm towing contract, again - Company linked to Daley pal has held the job for 20 years
BY FRAN SPIELMAN
COPYRIGHT BY THE CHICAGO SUN-TIMES
February 2, 2010
http://www.suntimes.com/news/cityhall/2024003,CST-NWS-sameguys02web.article


The Daley administration has awarded a $31.5 million towing contract to a clout-heavy company that's had a stranglehold on the business for the last 20 years.

Shortly after taking office in 1989, Daley turned towing over to Environmental Auto Removal, a newly-formed company whose owners had close ties to former State Sen. Jeremiah Joyce (D-Chicago), one of the mayor's closest friends in politics.

The firm and its parent company, United Road Services, held onto the business, even after the contract was re-bid in 2003, when the company's records were seized in an FBI raid believed to be tied to an interstate auto theft ring.

Now, yet another round of competition has ended with the same result.

The company, now known as United Road Towing, has a new, $31.5 million contract awarded last month. It calls for the company to manage and secure four Streets and Sanitation auto pounds, release Denver boots, tow abandoned vehicles within 24 hours of written notification and tow illegally parked vehicles within 90 minutes of city requests.

United has been paid $36.3 million since 2005 alone, $4.5 million of it since last June, records show.

Gerald Corcoran, president and CEO of United Road Towing, could not be reached for comment.

Shannon Andrews, a spokeswoman for the city's Department of Procurement Services, said United was chosen because it has a "dedicated fleet of 97 pieces" of towing equipment and sufficient personnel resources to do the job.

After selection, negotiations reduced the company's bid price "significantly," Andrews said, refusing to reveal specifics.

The only other bidder, Tegsco, lacked experience handling Chicago's towing "volume," failed to provide an adequate staffing plan and "relied on sub-contractors to perform all towing services."

The towing contract has been a constant source of controversy during the Daley years.

Martin McNally, an attorney and former president of Environmental, is an investor with Joyce in a company that holds a no-bid concession contract at O'Hare Airport.

McNally also has done legal work for Nello Sabatini, the former deputy in the city's Department of Streets and Sanitation who oversaw city towing operations until his 1998 transfer from that job.

In 2004, the Chicago Sun-Times exposed the city sale of about 70,000 cars a year to the company for no more than the going scrap-metal price, regardless of the vehicle's age or condition. Owners get nothing for their cars and still must pay fines and towing fees.

The towing company resold the cars through private auctions held at city auto pounds and kept the proceeds. The city ended up paying more than $100,000 to a dozen people whose cars were towed and wrongly sold for scrap.

Aldermen complained that the terms of the city's towing contract were tilted in United's favor.

City Hall initially defended the terms, then promised to renegotiate to add consumer protections.

The impoundment time on booted and impounded vehicles was extended from 15 to 21 days with a possible 15-day extension before vehicles are sold or destroyed. Drivers also were allowed to pay their fines and fees at city pounds. But, no other substantive changes were made.

The new contract tilts the scales a bit more in favor of motorists.

It requires the contractor to notify the city whenever a vehicle targeted for disposal "has a value in excess of $10,000 or receives a bid in excess of that amount."