Extension of Houston airport food contract put on hold

Sep. 13--Mayor Bill White said Wednesday he was confident he had the votes to extend a multimillion-dollar airport concession contract, despite a one-week delay forced by a councilwoman who said the deal should have been competitively bid.

"Open it up, let's have a competition," Councilwoman Anne Clutterbuck said. "If, indeed, this is the best deal we can get for the city, then the process will show it."

Clutterbuck used a tag, a parliamentary rule that allows council members to delay any measure for any reason, to hold off a vote Wednesday.

If approved, the contract extension would allow JDDA Concession Management, owned by local businessman Jason Yoo, to retain management of the food courts in Terminal C at George Bush Intercontinental Airport until 2016.

The concession contract, scheduled to expire next June, has not been put out to bid since 1990. The original agreement has been amended three times.

White remained firm Wednesday that extending the contract, rather than bidding, would give the city a better deal. An extension also would bypass a potentially lengthy and rancorous bid process.

In the past, open bids for food concessions at Hobby and Bush airports have led to protracted and ugly "food fights" at City Council as competing vendors battled to win the lucrative contracts.

The deal put forward by White requires JDDA to spend at least $10.5 million to renovate the food courts and to bring in a more experienced airport food management firm, Creative Host Services, for a 49 percent stake.

White said he was sure he had enough council votes to pass the extension next week. He said his administration had been tough with JDDA, but fair: "We weren't unreasonable, but we were hard-nosed. We don't do favors for anyone."

In the past two years, Yoo, his wife or his brother have donated at least $30,000 to the campaigns of eight council members. Donations to White totaling $11,260 extend back to 2003.

Councilman Peter Brown, who accepted at least $5,500 in campaign money from Yoo, supports the contract extension.

"We've got to get Terminal C fixed up," he said. "I don't think we have the luxury to go back to the drawing board on this."

Some council members were disturbed that the contract was not reviewed by either the Budget and Fiscal Affairs committee or the Transportation, Infrastructure and Aviation committee. The latter committee is chaired by Michael Berry, whose wife works at the law firm that is handling the JDDA contract. Berry did not return calls Wednesday.

Airport concession contracts are highly desirable; the Terminal C food courts have pulled in an average of $18.5 million in annual revenues since 1999, airport officials said.

The general manager for JDDA said those revenue numbers were misleading. Yoo has not cleared more than $200,000 a year since taking over the contract in 2005, Roger Schwandtner said.

The concession holder got only 4.6 percent of the food and drink revenues, and had to pay for maintenance and marketing, he explained.

Yoo and some of his subcontractors lobbied council members for a contract extension, on the basis that construction in Terminal C and the 9/11 airline slump had led to lower-than-expected revenues.

That argument frustrated Clutterbuck.

"This is, in essence, a new contract," she said. "You can't just call it an amendment because we want to give this particular owner a chance to recoup his investment."

Council members who asked the administration to review Yoo's concerns include: Michael Berry (who accepted $6,000 in Yoo-related donations), Ron Green ($5,000), Jarvis Johnson ($3,000), and M.J. Khan ($4,000). Other council members who took money from Yoo include Toni Lawrence ($2,000), Peter Brown ($5,500), Pam Holm ($3,500) and Clutterbuck ($1,000).

Clutterbuck and Holm said they strongly oppose the contract extension. Clutterbuck is considering returning Yoo's donation. Holm said the money would not influence her.

A longtime local political observer said he was sympathetic with those who wanted to avoid another "food fight."

"It's been big and ugly in the past because there's a heck of a lot of money involved," said Joe Householder of Public Strategies, a business consulting firm.

"I can see where the mayor and administration are going in saying, 'Let's avoid that and get a nice deal that gives us some more money, that maybe we could not have gotten in a public fight,' " Householder said.

"But, at the same time, open public processes are designed to be messy. If you don't want to have debate, then don't be in politics."

carolyn.feibel@chron.com

matt.stiles@chron.com

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