People and businesses with interest in a controversial but lucrative package of contracts at the Atlanta airport have donated more than $287,000 to candidates for mayor, an Atlanta Journal-Constitution analysis of contribution data shows.
The donations came from national and local companies hoping to profit from 10 contracts worth hundreds of millions of dollars for retail space in most concourses at the airport.
Mayor Kasim Reed and the airport’s leadership have pushed forward with the contracts despite revelations in September that the FBI had raided the office of a potential bidder. Jeff Jafari, then employed by PRAD Group but also representing the Airport Retail Concessions Group, resigned from PRAD shortly after agents removed boxes of documents from the company’s office.
All but one of the major mayoral candidates on the ballot Tuesday have called for Reed to halt the program because of the ongoing bribery investigation at City Hall, which has exposed pay-to-play corruption in procurement.
Reed wants the City Council to approve the contracts before he leaves office in January, even though previous airport procurements have taken a year or more. Even if Reed is successful, the next mayor could be in charge while the contracts are negotiated.
The 16 companies and joint ventures that are competing for 82 retail locations submitted their proposals in late September, but each of those could include multiple partners and subcontractors who aren’t immediately known. The AJC searched for campaign contributions from 97 companies that attended a critical pre-bid conference Aug. 3 to pose questions about the bid process.
Thirty-six companies from that list, or 37 percent of those in attendance, have given money to the top candidates for mayor, based on an analysis of contributions through Nov. 1.
They include restaurant operators Hojeij Branded Foods ($66,450), Concessions International ($29,700) and Master ConcessionAir ($48,165), as well as duty-free goods and bookstore operator Paradies Lagardère ($5,000). Companies and individuals associated with Jafari gave at least $33,600.
The stores, restaurants and kiosks up for bid amount to a quarter of the retail and food and beverage locations at Hartsfield-Jackson International Airport, and include bookstores, clothing and sundry shops, coffee bars and other lucrative spaces at the world’s busiest airport.
City Councilwoman Keisha Lance Bottoms was the only candidate to support Reed’s position on the contracts, and also won the bulk of the support from concessionaires identified by the AJC as having interest in the airport program. Reed officially endorsed Bottoms Oct. 11 after publicly signaling his support as early as January.
Bottoms received more than 65 percent of the donations, totaling nearly $187,000. That includes $25,700 previously identified by the AJC and Georgia News Lab as having come from companies associated with Jafari. Bottoms returned those contributions once they were publicized, but the AJC’s latest analysis found an additional $7,900 tied to Jafari, PRAD Group and associated individuals.
Bottoms told the AJC she was aware of the support from vendors and said that she had been transparent about disclosing it.
“Business owners read polls like the rest of us and have likely donated because after looking at all of the candidates, they have determined that I am the only Democrat with a clear path to victory,” she said in an email to the AJC.
City Council President Ceasar Mitchell was the next highest recipient with 20 percent of the donations, or $58,726.
The analysis showed the vendors and others present at the meeting also threw some support to Councilwoman Mary Norwood ($14,750), Councilman Kwanza Hall ($13,350), while the rest of the field received less than $13,700 combined.
A previous AJC analysis of campaign donations showed that vendors to other city departments, including watershed and public works, have contributed hundreds of thousands of dollars more to the candidates. Overall, the nine major candidates have raised over $10 million, making this year’s race one of the most expensive in history.
The intersection of campaign finance and government business is often fraught with questions of influence. In some industries, regulators have stepped in to address concerns. The U.S. Securities and Exchange Commission, for instance, bars investment advisers from providing services to a government, if the company or its employees made political contributions to an elected official in position to influence the selection of the company.
Investment advisers should not be selected on “kickbacks and favors,” then-SEC Chairman Mary L. Schapiro said when the rule was adopted. “These new rules will help level the playing field, allowing (companies) of all sizes to compete for government contracts based on … skill and quality of service.”
Companies donating to political campaigns while active in the procurement process should be a concern to voters, said Edward Queen, director of the D. Abbott Turner Program in Ethics and Servant Leadership at Emory University.
“My biggest concern is that this is simply going to increase the public cynicism and distrust of government, which is fundamentally threatening to our democracy and to our republic,” Queen said. “I want corruption to be seen as an anomaly rather than be normalized — this is the way things operate and I need to play the game too.”
A fast-track procurement
On Aug. 3, a who’s who of airport concessionaires filled a meeting room at the Georgia International Convention Center for a city briefing on contracts at Hartsfield-Jackson. Successful bidders could hope to get a lock on the valuable retail space for up to 10 years.
Months earlier, representatives of some of the companies in the room had gathered for a different purpose: raise money for Bottoms and her bid to succeed Reed. The host committee for the January fundraiser included Jafari and 19 others, some of whose companies already did business at the airport. The committee, many of whose members backed Reed for mayor in 2009 and 2013, gave “special thanks” to Reed on its welcome placard.
The committee included Wassim Hojeij of Hojeij Branded Foods, Master ConcessionAir executive Dwayne Heard, and Daniel Halpern of Jackmont Hospitality, who was a co-chairman of Reed’s 2009 campaign for mayor.
Much had happened since the fundraiser and the meeting of concessionaires at the convention center. In late January, a prominent city contractor had pleaded guilty to conspiracy for paying more than a $1 million in bribes to an unnamed individual in hopes of winning city contracts. A second guilty plea from another contractor soon followed, and in February federal agents searched the office of the city’s top procurement official, Adam Smith, who was fired the same day.
Procurement officials at the August gathering made it clear the airport contracts were on a fast-track, planning to award them in October and execute leases in December.
Some concessionaires raised questions about the rapid pace of the program, and whether a new administration at City Hall could introduce political uncertainty into the airport contracts.
Jafari said vendors were spending big money preparing bids and asked if they were “taking the chance” it might get thrown out by the “new regime.”
Audience members applauded and murmurs filled the room.
In response, city procurement officer Mano Smith said, “Thank you, thank you, thank you. Thank you for your question-slash-statement,” prompting laughter and applause.
“The intent is to have the contracts executed by December,” he said. “That’s the intent. I see you do not have a lot of faith in that happening. But that is the goal.”
After multiple concessionaires asked for more time, Smith responded: “The further we push it out, the less likely it will be awarded in this administration. So just keep that in mind.”
Candidates call for slow down
By late August, airport procurement became an issue in the crowded mayor’s race.
On Aug. 24, Mitchell called for a moratorium on contracts that would still be in force next year, including the existing airport concessions contracts, which don’t expire until September 2018. Mitchell said the next mayor and council should have say-so over the deals because they could ultimately be in force for a decade.
At the time, however, Mitchell acknowledged that a moratorium might not be popular with vendors already counting on city business. He was right.
Donors tied to the airport retail program gave him just $750 after he announced the proposed moratorium. Those donors ponied up more than $72,700 for Bottoms after his announcement, or 39 percent of all the donations she received from those with a potential stake in the contracts. Other candidates collected just $8,400 combined from these donors.
On Sept. 20, the FBI raided the offices of PRAD Group, where Jafari worked, and six days later Smith, the city’s former purchasing chief, pleaded guilty to taking at least $30,000 in bribes from an unnamed city vendor.
The day after Smith’s guilty plea, the 16 firms submitted proposals for the airport concessions contracts, including Airport Retail Concessions Group, which Jafari had represented at the pre-bid conference, and Hojeij Branded Foods.
Airport: Continuity for travelers
Mayor Reed, who has previously said the city’s business should not halt because of the bribery investigation, referred questions about the concessions contracts to the airport.
Roosevelt Council, the general manager at Hartsfield-Jackson, said completing the airport retail contracts this year is appropriate and necessary to prevent disruptions of service.
“Moving forward with contracts in the 2017 calendar year is a sound and responsible practice for operations planning,” he said. “This process will allow us to have the contract negotiation and build-out phase completed as quickly as possible, which will ensure continuity for travelers moving through Hartsfield-Jackson Atlanta International Airport.
“The timing will ensure all shops are occupied and able to serve our customers,” he said.
The controversy over the airport contracts and donations to Bottoms, meanwhile, has generated new attacks against the mayor’s favored candidate.
“Everyone running for mayor who is or has been on City Council has ‘green blood’ on their hands,” candidate Peter Aman told the AJC. “It’s said, in hushed tones, that Mayor Reed is pushing airport vendors to give to his preferred candidate, Ms. Lance Bottoms. Follow the money. Both of these people could benefit by perpetuating an apparently unethical City Hall culture.”
Reed’s communications staff accused Aman of “lying.” But other candidates also leveled similar accusations against Bottoms and the administration.
“One of the candidates has received two-thirds of all contributions from companies bidding on these contracts that should not even be up for bid,” Mitchell said. “That sends a very troubling and dangerous message; one that we should all be very concerned about. The message it sends is you have to give to a certain candidate if you want to win a contract.”
In a recent debate, Norwood signaled support for limiting campaign donations from city vendors.
“We know the mayor has endorsed Ms. Bottoms’ candidacy,” Norwood said in an interview. “We know the mayor is actively working to lock in contracts. The appearance of steering contracts and steering campaign contributions and connecting the two is troubling in a city that has an ongoing investigation by the Department of Justice at City Hall.”
If elected, Bottoms said she would not be influenced by donors.
“I have always conducted myself in an ethical and transparent fashion and that will not change if I am fortunate enough to be elected Mayor,” she said.
Halpern, a food service executive whose company was represented at the Aug. 3 pre-bid conference, said it was “very unfair to correlate” campaign donations and interest in city business, as the AJC had done.
“Sounds like if 65 percent of the people are giving to a particular candidate, they must think that person is the best candidate,” he said.
Data specialist Jeff Ernsthausen contributed to this report.
How we got the story
Reporting for this story started when reporters and data specialists at The Atlanta Journal-Constitution, and journalists with the Georgia News Lab, digitized the campaign contributions to the nine major candidates running for mayor. AJC reporters then compared that database of approximately 15,500 donations against businesses and individuals who attended a pre-bid conference Aug. 3 for retail space at the Atlanta airport. To arrive at total contributions from interested airport parties, the reporters included individuals and businesses associated with those companies, such as employees and family members.