Tag Archives: rental

Further Critique of State’s Rental Car Contract

WTVF-TV’s Phil Williams and Tennessee Tax Revolt’s Ben Cunningham teamed up for a followup critique of the state car rental contract with Enterprise Rent-a-Car. (Previous post HERE)
Excerpts:
As our investigation first revealed, the Haslam administration outsourced state government’s motor pool to Enterprise and its WeCar car-sharing program. It did that without giving any other company a chance to compete for the job.
But while the state contract with Enterprise specifically calls for “hourly car-sharing services,” there are no hourly rates.
So when the Department of Education checked out a mid-size car and used it for just 51 minutes, Enterprise sent them a bill for $34 — the full daily rate.
When the Board of Probation and Parole reserved a minivan for exactly one hour, even though no one ever showed up to get it, the agency still got hit with a $48 charge.
…And even though state employees get locked out of a WeCar at the end of a trip, Enterprise still sends them a bill for the full reservation if they end a trip early — unless they take the time to go online and change the reservation.
Which is how the Department of Correction, after using a car for just two days, got a bill for four days. That’s because the original reservation was for three days — and 30 minutes.
“When something occurs like this, they should go back to the vendor and say, ‘Hey, this is a huge contract. You give us the benefit of the doubt. You give us the best rate,'” Cunningham said.
And while the state’s contract with Enterprise offers a cheaper weekly rate, it usually doesn’t show up on bills it sends to state agencies.
So when the Department of Education rented a minivan, it got the daily rate times seven. The weekly rate would be almost $50 cheaper.
…But Enterprise insisted that it doesn’t get one cent more than it should.
That’s because, when the Department of General Services negotiated the deal, it promised Enterprise a guaranteed amount each month. And after Enterprise bills all those state agencies, General Services always has to write a check to make up the difference.
…As NewsChannel 5 Investigates previously reported, in the last 12 months, General Services had to pay $289,000 to make up the difference.
In fact, Enterprise said that it generates the bills based on rules specifically set up by the state and that General Services approves every bill before it goes to the other departments — including those questionable charges uncovered in our investigation.

State’s No-Bid Rental Car Deal Questioned

In a Phil Williams report, WTVF-TV is raising questions about the Haslam administration’s contract with Enterprise Rent-a-Car as a state motor pool.
“This is not good business,” said Rep. Mark Pody, R-Lebanon, who sits on the legislature’s Fiscal Review Committee, after seeing the documents that we uncovered.
…(D)uring his first two years in office, Haslam’s administration has been quietly taking jobs from state employees and turning them over to big business. It’s an effort that’s been spearheaded by Haslam’s General Services Commissioner, Brentwood developer Steve Cates.
…In the case of the motor pool, Haslam’s Department of General Services decided in late 2011 to outsource the program to Enterprise and the car-sharing program that it calls WeCar.
The major push for that contract began about that same time that Cates hired former Enterprise executive Kathleen Hansen to head the department’s motor vehicle management division.
In fact, NewsChannel 5 Investigates discovered, the Haslam administration made a conscious decision not to put the state’s business up for bids, citing the “difficulty” of going through that process.
“The rental of cars has not been solicited by the Purchasing Division in the past; therefore it does not have experience in developing the specifications,” a justification memo said.
That notion “does not hold one drop of water for me,” Pody said.
…General Services officials justified the Enterprise deal in a memo, saying it would “piggy-back” on the “University of Tennessee’s WeCar” program — which had been put up for bids.
But, in a statement to NewsChannel 5 Investigates, said: “The University of Tennessee does not have a WeCar program.”
UT’s statement “causes me a great deal of concern,” Pody said.
Instead, our NewsChannel 5 investigation discovered, UT’s contract with Enterprise was just for a rental discount program for university employees and alumni who were traveling.
UT never outsourced its own motor pool.
And only one other company even bothered to submit a bid for the university’s business.
…”As a business man, if one of my managers came in and had done this with my money, I probably would have fired them,” Pody added.
…NewsChannel 5 Investigates went online looking for discount codes, then trying to reserve a car.
We found a mid-size car for $26 a day; the state’s price: $31. Our weekly rate: $148. The state’s: $184.
Compared to other states, Oklahoma has a deal with Enterprise to get the same car for less than $160 a week.
And even though WeCar boasts that it offers great rates for quick trips, Tennessee’s contract has no such deal.
The same car in other states is less than $10 for an hour. Tennessee pays the full daily rate — $31 — three times as much.
“There is something bad wrong,” Pody said. “If I can rent it cheaper as an individual or as one car, compared to the state renting a hundred a day, there has to be something wrong somewhere.”
When state employees need a car, they can go to an Enterprise location — or they can come to a state WeCar lot, like one located in the shadow of the state Capitol.
But our investigation discovered, under the Haslam administration’s deal with Enterprise, the company gets paid for just leaving cars there, waiting to be rented.
During the last 12 months for which bills are available, state employees actually used almost $450,000 worth of WeCar services. But Tennessee paid Enterprise $739,000.
…(General Services officials) argued that one of the big advantages of this contract is that the state can get a rebate of as much as 8 percent — money that comes back to taxpayers. The question, critics told us, is whether the savings have been even more if the contract had been put up for bids.