BY JOE MARVILLI
Further details have been released about Telebeam Telecommunications Corporation’s lawsuit against the City over PlanNYC.
The complaint, filed on Dec. 4, is seeking to prevent LinkNYC from creating a monopoly, as the contract for the kiosks was awarded to one proposal, CityBridge. The contract, which was approved by the Franchise and Concession Review Committee on Dec. 10, will force present franchises, including Telebeam, to exit the market for this franchisee.
At the FCRC hearing on Dec. 8, Telebeam submitted two items to back its position against the LinkNYC contract. One was a written submission made by Tony Coles, former Deputy Mayor for Planning, Education and Cultural Affairs for Rudy Giuliani, on behalf of Cemusa, which is the City’s Street Furniture Franchisee. The other is a document by Randy Mastro, Deputy Mayor for Operations under Rudy Giuliani, which was supported by a letter exchange between Titan Outdoor, the managing member of the CityBridge LLC, and the DoITT.
In the Cemusa letter, Coles said there were “glaring defects” in the request for proposals for the LinkNYC project, which was issued on April 30. He said the RFP violates the City Charter, the New York City Administrative Code and the federal Telecommunications Act of 1996.
First off, the letter states that the resolutions of the City Council that the DoITT relied on when issuing the RFP only apply to the grant of public pay telephone franchises and mobile telecommunications franchises for the installation of “inconspicuous” equipment, like light-pole antennas. Therefore, the RFP for the kiosks, which are public communication structures, cannot be authorized under Council guidelines and fall beyond the DoITT’s authority.
The letter also said that the DoITT issued the RFP without conducting the Uniform Land Use Review Procedure, which is required as installation of the kiosks will affect street aesthetics.
Mastro’s letter to the FCRC went over points of apparent favoritism in the RFP process. As a member of the law firm, Gibson, Dunn & Crutcher LLP, he represents Telebeam in this case.
He stated that according to published reports, Robert Richardson, a former senior executive at Control Group, left that position for a senior technology policymaking post at the DoITT. This happened around the same time the agency was going through the RFP submissions. Control Group is one of the companies in the CityBridge proposal. Control Group also worked with the Mayor in his expansion of pre-kindergarten enrollment.
“The FCRC should not risk undermining public confidence in the integrity of the proceedings by approving the proposed agreement without conducting a thorough and meaningful factual investigation into the circumstances concerning Richardson’s employment history and the Control Group’s close ties to the administration,” Mastro said.
He also criticized the selection of CityBridge due to failures on the part of one of the group’s members. Titan had an advertising contract with the MTA but failed to pay about $20 million owed in ads. In response, the MTA terminated Titan’s contract.
In addition to his letter, Mastro provided an exchange between Titan Outdoor and DoITT that took place over the summer, before the DoITT awarded the proposal to CityBridge. In the letter, Titan’s president and CEO Donald Allman and CCO Scott Goldsmith express their concerns over the contract going to one franchisee. Stanley Shor, the assistant commissioner for franchise administration, wrote back and said the DoITT is considering one franchisee option to create a systematic approach to the kiosks. Shor said it would be similar to when the City granted a single franchise for sidewalk bus shelters and newsstands in 2006.
Responding to the lawsuit, the DoITT said that the contract with CityBridge is non-exclusive, meaning the City is not locked to one provider and has the option to issue a new RFP in the future. Secondly, even though CityBridge is one proposal, it is made of multiple companies. While there were several payphone franchisees, it did not lead to ongoing innovation, which usually happens in the face of competition. The DoITT also said that although competition leads to lower prices, the kiosks are free to use, rendering that point moot.
“LinkNYC is an important part of the City’s ongoing effort to widen the availability of broadband service to New Yorkers across the five boroughs,” Nick Sbordone, DoITT spokesman, said. “The City has reviewed the plaintiff’s arguments and believes our franchise is entirely consistent with applicable law.”
Reach Joe Marvilli at (718) 357-7400, Ext. 125, firstname.lastname@example.org, or @JoeMarvilli.