The City Council on Monday went against a staff recommendation and voted down a proposal to grant a $9.2 million, three-year contract to beleaguered LAZ Parking.
Instead, the council voted 6-2 to stay with Modern Parking, Inc. and Parking Corporation of America (PCOA), the companies currently managing the garages, for one year. After that, the city will move to work with one vendor.
Council members Margaret McAustin and Gene Masuda voted against the motion.
LAZ, which would have managed parking garages in and around Old Pasadena, was released from its contract in Boston in 2016 after it was discovered garage employees had skimmed millions of dollars. In July the company agreed to pay $5.6 million to settle allegations that it “failed to detect and deter” the theft of transportation revenue.
“We had an issue where someone absconded with money,” said Councilman John Kennedy, referring to the $6.4 million embezzlement scandal that rocked Pasadena in late 2014. “I am wondering if it is irresponsible for the city to provide a contract to an entity that has been accused of doing the same and that reached a settlement with the attorney general’s office without admitting fault or guilt. That’s a real big question mark.”
“I care deeply about honesty, integrity and trust,” LAZ CEO Alan Lazowski told the council.
“I think this is the best company in the world,” said Lazowski. “Not just among parking companies, but any company.”
Criminal charges against LAZ were still pending in July 2016 when the company won the bidding process to manage Pasadena’s garages.
An item to approve the LAZ contract was pulled from the consent calendar after it was revealed that LAZ had lost its contract with the Massachusetts Bay Transportation Authority following the investigation into the lost revenue.
After the theft became public, the council expressed concerns about the lack of reference checks done during the bidding process and requested the bidding process start over.
After reviewing the bidding process, LAZ scored highest again and staff recommended the company be awarded the contract before the council voted against it.