Friends in Tow Places
Few things in life are as sure to pay off as a City of Miami towing contract. Each month the six private companies that hold city contracts are asked to tow about 350 broken-down, illegally parked, or otherwise offensive automobiles. The car owners, in turn, pay the towing company $55 for the privilege of getting their vehicles back. Over the course of a year, all those tows add up to an annual gross in excess of $200,000 for each company. "It's a good business contract. The trucks don't get much mileage and, bottom line, it pays money. Good money," says Laurie Lichtman of Midtown Towing, a firm that does backup work for the city and would like to have a regular contract.
There is one wrinkle. From the $55 collected on each tow, companies must pay the city $10. (That's about the going rate: Miami Beach collects $20 per tow; Metro-Dade takes $15.) Paying the fee, towers say, is not a cumbersome exercise. "We pay it every month," volunteers Donny Balmaseda of Molina Towing, a firm currently under city contract. "As far as we're concerned, we've never had a problem."
The same, however, cannot be said of Nolan's Towing and Recovery, which owes the City of Miami at least $30,000. That debt miffs the owners of several other local companies who have asked that the city cancel Nolan's contract and allow them to bid for the job.
"If there is a contract, it has to be followed," says Dagmar Del Rosal, executive vice president of Downtown Towing, another company interested in replacing Nolan's. "If they're going to bend rules, they should just let everybody tow."
Miami's contracts with all six towing companies expired in January. Six months later, city commissioners are no closer to seeking new contracts. The extension of bids -- the city's announcements that the jobs are up for grabs -- is only the first of many steps toward a new contract. And until the new contract is approved by the city commission, Nolan's and the other five companies continue to collect their profits while the competition is shut out.
The bids were to be sent out at the May 11 meeting of the Miami City Commission. If they had been, Nolan's Towing surely would have lost its contract. The company has struggled to secure property for storing impounded vehicles; its property lease with a local car dealer is so shaky that Metro-Dade refuses to let Nolan's tow for the county. (With the new bids, Miami's regulations, which were not strict about storage in the past, will become as stringent as the county's.)
At the May meeting, Vice Mayor J.L. Plummer told his fellow commissioners he had received a phone call that morning from Bill McClaskey, founder of Nolan's Towing. McClaskey, Plummer explained, had called to ask if the bids were to be extended. No, Plummer assured McClaskey, the request for bids would be withdrawn. In essence, this meant McClaskey could continue towing despite his lease and debt problems.
"As many people know, his wife is very seriously ill," Plummer declared. "He asked if this matter was going to be deferred and I told him it was going to be withdrawn. These are also friends of mine. Just as good of friends as others."
Such a close relationship between an elected official and a deadbeat city contractor has several of Nolan's competitors convinced the commission is a closed society. Business, they say, is awarded to friends at the exclusion of more qualified and responsible companies.
"The city is nothing but a good ol' boy system," says Don Lawson of D&R Towing in Opa-locka, a firm that is not seeking a city contract because of the politics involved. "And I'm a redneck good ol' boy myself, but I believe in fairness."
According to a City of Miami audit dated April 6, 1991, Nolan's had accumulated $25,310 in debts from October 1990 through September 1991. Though the firm had paid off two months' worth of that debt, it still owed more than $21,000 at the time of the audit. By May 1992, according to another report, Nolan's total city debt was $69,970. There were other problems, too. In April of this year, all the company's tow trucks were repossessed, a situation that, along with the high level of debt, prompted the city's Towing Review Board to suspend Nolan's. For that month, the tows that normally would have gone to the company were divided among three backup firms.
Those backup towers feel that the city should have cut its losses right then and revoked Nolan's contract. City Manager Cesar Odio disagrees, arguing that he has no choice but to honor the contract. "The only way we can collect the money that [McClaskey] owes is by letting him work," Odio contends. "And we intend to collect our money." (McClaskey did not return phone calls seeking comment for this article.)
While the Towing Review Board gave Nolan's time to repurchase its trucks, the city's finance department gave the company an enviable debt-repayment schedule. Although Odio calculated that Nolan's owed $54,000, Manohar Surana, director of the finance department, reduced the debt to $30,000 -- to be repaid without interest over a year. Only a month after the suspension, Nolan's was reinstated.
Still, the company isn't paying up. Nolan's first $2500 installment under the debt agreement was due June 1. According to Surana, the payment wasn't made. "They paid a down payment of $5000 for May, but they did not yet pay for June," Surana said this past week. "We are expecting it in a few days."
Commissioner J.L. Plummer says he doesn't know enough about his friend Bill McClaskey's company to judge whether the city should terminate its dealings with the firm. "I don't know that they owe payment," adds Plummer, who says he hadn't heard that Nolan's had failed to come through with its first installment. "But if they do and they didn't pay it, as far as I'm concerned, I object."
Plummer says there is a possibility that Nolan's will lose its contract when the bids are sent out. When those contracts will be sent out is another matter. Plummer concedes he has no idea. Others familiar with the city commission say it could take as much as six more months. And until the bids are sent out, Nolan's will keep towing. And keep owing.
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