Most companies on the losing end of a competitive bidding process don’t get another shot, but Riggs Ambulance Service did, and now it has Merced County’s estimated $12 million ambulance contract.
The Board of Supervisors on Tuesday unanimously approved a five-year contract with Riggs, which will be purchased by Sierra Medical Services Alliance, the company’s Nevada-based nonprofit partner. President Kraig Riggs said he merged with SEMSA to keep his company financially viable.
“This merger took place because the nonprofit model is the best option for this community,” Riggs told the Merced Sun-Star on Tuesday. “When you’re a nonprofit, you’re not subject to state or federal taxes.”
The contract awarded to SEMSA was the subject of a bitter dispute after competitor American Medical Response won the initial bid last year. Riggs officials claimed the process was unfair and flawed, and pleaded with county supervisors to cancel the award to its competitor and start over.
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The emotional appeals worked, and county supervisors voted to rebid the contract in January 2013. The county hired a new consultant, Fitch & Associates, after questions surfaced about the previous consultant’s involvement with Riggs.
The county’s former emergency medical service administrator, Chuck Baucom, worked for a consulting firm drafting the bidding documents and obtained confidential documents after his retirement, a Sun-Star investigation revealed. It appeared Baucom attempted to sway the process in favor of Riggs, according to emails.
But this time around, county officials say the integrity of the bidding process was maintained.
“I didn’t see any evidence that it wasn’t handled with the highest degree of integrity,” said Merced County Public Health Director Kathleen Grassi. “We put it in the hands of a highly regarded consulting firm, and that’s really all you can do. You have to trust the process from there.”
Riggs, which has provided service to Merced County for more than 65 years, also stepped up its game. The company added more ambulances and equipment, no longer relying as heavily on mutual aid from neighboring counties.
“Mutual aid requests have gone down dramatically,” Grassi said. “We’ve been tracking the response time percentages over the last year, and it’s been a marked improvement.”
The takeover by SEMSA will have little effect on the ambulance provider’s service, officials said. The company will still participate in community service events, including providing free standby ambulances to high school sports activities and other events.
Community involvement is one area SEMSA outshone AMR, according to company officials. The proposals of the two companies, including their scores from a panel of confidential evaluators, have not been publicly released.
“There was a very good spread between the two competitors to show Riggs was the clear winner,” said Mike Williams, SEMSA vice president and chief operating officer. “Some of those areas, we were head and shoulders ahead of the competition.”
The scoring guidelines did not include additional points for “local” providers, which was a highly contested part of the original process. Williams shot down the idea that Riggs is no longer a local company because SEMSA is based in Nevada.
“Out of 150 (Riggs) employees, they are all residents of this area,” Williams said. “If that’s not a local company, I don’t know what is.”
As a nonprofit, Williams said, SEMSA doesn’t have to worry about investors or putting money in other people’s pockets. But the nonprofit’s acquisition of Riggs caused a few financial worries.
A May 16 letter from Merced County’s purchasing department outlined its intent to award the contract to Riggs, but also questioned the company’s financial stability.
Williams insisted SEMSA has what it takes to acquire Riggs and still fund Merced County’s ambulance operations. “Every dollar we get doesn’t go into someone’s bank account,” he said. “It’s reinvested in the equipment and the employees.”
The five-year contract with SEMSA allows for a five-year extension.