Taxi Standoff

Photo by Keith MayLeave it to the county to scandalize what should have been an honest bidding process. That's what happened when officials cozied up to one of the county's most powerful lobbyists —something that could end up costing the county millions.

On March 22, county officials yanked a lucrative $2.8 million contract for exclusive cab service at John Wayne Airport (JWA) from Santa Ana-based A Taxi. The company, started by Lyle Overby—a powerful lobbyist and former aide to three county supervisors who were later convicted of corruption—and his partner Richard Schorling, had held the contract since 1996, even after Overby and Schorling left the company.

As late as March 20, county officials had led A Taxi's current regime to believe it had won an open-bidding competition to get the contract for an additional three years.

Indeed, A Taxi had beat out its competitors for the JWA contract, but on March 22, it was told to shove off. Taking its place was a barely six-month-old company—a company so young it shouldn't have been allowed to bid in the first place. That company is called American Taxi, and its owners are Lyle Overby and Richard Schorling.

This isn't surprising, considering how county politics work. What also isn't surprising is that on Oct. 19, A Taxi sued the county for breach of contract.

Though the county's internal auditor found nothing wrong with the taxi-contract bidding procedure and the county's risk-management office completely rejected A Taxi's initial wrongful-termination claim, the official record of those days in late March show A Taxi may have a very strong case against the county.

After all, county officials selected A Taxi as the winner in the airport-cab competition. Its books were in order, and its service was excellent. Airport staff said as much in reports filed with the John Wayne Airport Commission.

On March 15, airport director Alan Murphy went before the five-member commission and recommended they approve A Taxi to continue serving JWA. This they did, by a 3-2 vote.

Six days later, everything changed. Going before the county Board of Supervisors, which also had to approve the contract, Murphy reversed course. Instead of approving A Taxi, as earlier recommended, the board—with Murphy's prodding—was now to reject them in favor of a new company, American Taxi.

Keep in mind that American Taxi originally lost the contract competition to A Taxi. Keep in mind that American Taxi failed to come close to meeting the county's five-year experience requirement for bidders. Keep in mind that American Taxi was already $130,000 in the hole when Murphy told the board to give it the contract.

Murphy's excuse for pulling the rug out from beneath A Taxi was that the company's insurance policies were bad. But as the Weekly earlier pointed out ("Taxidermy," Aug. 25, referenced in A Taxi's lawsuit), county risk-management officials didn't know anything about American Taxi's insurance policies when Murphy told A Taxi to ship out.

Even though county officials had already told A Taxi it had until March 27 to obtain new insurance, sheriff's deputies appeared at JWA on March 22 and rousted any A Taxi cabs that remained. On that day, A Taxi still had nine days of airport service left on its original contract.

Of course, it now appears that both A Taxi and American Taxi had the same insurance policies. In any case, Murphy had already conceded that the whole insurance issue was a "nonissue" at the March 15 airport-commission meeting.

Although he ended up voting to give the contract to American Taxi, 3rd District Supervisor Todd Spitzer's attorney instincts were clearly present during the March 21 board meeting, when he said he wanted to "make a record, so that when the court reviews it, they will not think we abused our discretion."

Now the court is reviewing it. Attorneys from the county counsel's office didn't return repeated phone calls for comment. But the law firm Gibson, Dunn & Crutcher, which is representing A Taxi, hopes to get the county to throw out the current American Taxi contract and start over. They hope, in other words, to get the county to do what it very nearly did: award a hefty contract to a firm after an honest bidding process.


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