The Memphis Commercial Appeal has reported that a local tire dealership, contracted with the city to repair flat tires, racked up bills of more than $1 million last year – a substantial increase from 2005 when it charged the city just $100,000.
Around Town Tire & Trucking holds the exclusive rights to repair flat tires on the city’s 5,800 vehicles, and has not been charged with any wrong-doing.
According to the newspaper, “Around Town worked primarily on light vehicles, responding to roadside flats. In 2006 or 2007, it took over tire repairs on the city’s heavy equipment. In the six years since that contract was awarded, the firm has billed Memphis taxpayers $2.6 million for 33,000 tire repairs. Costs have ballooned from $100,000 in 2005 to more than $1 million last year – far in excess of the contract’s estimated annual maximum cost.”
The city is now considering taking the tire repair work in-house. "I think we’ve got to look long-range at what is the best solution,” said General Services interim director Rebecca Kissinger. Previously, Around Town stationed its own employees at the city’s five vehicle depots.
Kissinger said Around Town employees still will respond to service calls but because of liability concerns "they cannot be sitting on my site waiting for something to happen.”
The city purchases its own tires on a separate deal with another vendor.
Over the years since 2003 when Around Town first won the contract, the city’s General Services Department, which manages the contract, assumed control of all city vehicles, including fire and emergency equipment, construction and service vehicles and sanitation vehicles, effectively increasing the tire dealership’s service responsibilities.
“At the same time, officials have done a poor job anticipating tire repair costs,” the newspaper wrote. “Records show Around Town’s annual payments repeatedly exceeded contracted amounts by hundreds of thousands of dollars – something officials were hard-pressed to explain last week. Records released by the city show the contract set an estimated cap of $100,000 in 2007, yet the city paid $301,000. Despite a $200,000 cap last year, the city paid $1.1 million. By comparison, Nashville pays outside tire-repair contractors $29,000 a year.”
