Wednesday, October 20, 2010

Did The Parking Lease Process Involve Too Much Information, Or Not Enough, Or Both?

One fascinating aspect of the Late Great InsolvenCity Parking Garage Sale concerns the flow of information.

Alan Lazowski, leader of LAZ Parking (part of a last-minute partnership with JP Morgan), has expressed surprise concerning council's long-simmering distaste for the process in which his proposal was accepted by Mayor Ravenstahl and rejected by councilors:
Mr. Lazowski said his team was "elated" to learn it was the winning bidder last month, but surprised to find out later that city officials were deeply divided on the lease proposal.
Billions of dollars on the line, including millions of dollars in bidding costs, and Mr. Lazowski was blindsided when just one council vote was available to the LAZ-JP Morgan-Ravenstahl-[to be determined] proposal? Did Mr. Lazowski never pick up a newspaper or watch a local television news program during his frequent visits to Pittsburgh? Did he never attempt to operate any type of Google-compatible Intertubes device during the past year? None of his colleagues, lawyers, accountants or friends? None of their spouses? None of their children?

If this circumstance fairly reflects LAZ Parking's level of attention to detail in business matters, does anyone want this outfit to be responsible for ensuring that a mechanized parking garage exit works properly after the attendants have left for the night?

Some questions about information flow to the successful bidder (and to other bidders, and to qualified entities that elected not to bid, and to entities that did not qualify) also seem pertinent. Did all bidders have access to the same volume, content and sources of relevant information? Has anyone asked the dropouts why they declined to pursue the transaction? If City of Pittsburgh representatives treated all prospective lessees equally, why were bids so dissimilar. . . or missing?

A bidder might have conducted superior independent research, relied on better understanding and forecasts, engaged better advisors, asked better questions. Or, as too often occurs in bankruptcy proceedings, insiders might have favored one or more bidders with respect to assurances and information (perhaps through unofficial conduits).

Those attempting to chart a proper course concerning pension funds during the next couple of months should probably concentrate on that task without permitting an autopsy to divert attention, but it seems worthwhile to revisit some of these issues when that pressure dissipates.


Anonymous said...

Anonymous said...

Uh, maybe he thought that the fact council had a couple years to weigh in on the agreement and the fact that the Mayor spent countless hours opening up the process to council and even made substantial changes to the lease to reflect concerns of council that maybe more than one of them would vote for it.

Anonymous said...

anon 10:20,
what reality do you live in? if you're going to make claims that our Mayor behaved that way in thst of us live in, you should provide some evidence.

Anonymous said...

That should have read:
"...that our Mayor behaved that way in the reality that the rest of us live in.."