Colorado Springs leaders are negotiating with a company that promises to provide more economical ambulance services, but Priority Ambulance has two leaders who also led three similar companies that went bankrupt in five years.
The failed ventures left scores of cities without ambulance services, required millions of dollars in aid from local governments and left thousands of people jobless.
Colorado Springs notified Priority last week that it was the top choice for the new contract, said company Chief Growth Officer Glenn Leland.
The Knoxville, Tenn.-based Priority is among the five biggest such companies in the nation, Leland said, and has a flawless reputation.
But Priority CEO Bryan Gibson has been in at least two deals that fell through.
Gibson was chief operating officer of Rural/Metro Corp. when it signed a $375 million contract with Santa Clara County, Calif., in 2010, the San Jose Mercury News reported.
The county had dropped its contract with American Medical Response, just as Colorado Springs leaders are considering doing now.
Gibson resigned from Rural/Metro at the end of June 2011, and the company's contract with the county started in July.
Rural/Metro almost immediately failed to meet its required response times, the Mercury News reported.
County Executive Jeff Smith said the company was losing up to $10 million a year on the contract. So the county reduced fees and cut other requirements, saving Rural/Metro about $15 million, Smith said.
"It's hard to know why they gave us an unrealistic bid," he said. "Was it just a mistake on their part? Did they not have information that came to light until later? Did they have an intention to be a loss leader for a while so they could get into the market? Or was it simply a lack of competence?"
Gibson could not be reached for comment.
He took over as CEO of First Med EMS, based in Wilmington, N.C., in 2013, Priority's website says.
Gibson's job there lasted less than four months. He left just before First Med abruptly closed in December 2013, leaving patients in more than 70 cities without service and costing about 2,000 employees their jobs, report NBC News and the Wilmington Star News.
In 2014, Gibson joined a new team that founded Priority, according to the company's website.
Leland said he was CEO of TransCare EMS on the East Coast from 2015 to early 2016.
"I was recruited to turn around the company, which was in significant strain at the time," he said.
TransCare had financial struggles and ultimately couldn't replace ambulances or pay employees, say New York Times reports.
Emergency workers reportedly were pressured by supervisors to take supplies from hospitals without approval.
"It became a company too broken to fix," Leland said.
The company closed in February 2016. Leland said he resigned a month earlier - the third CEO to leave in four months, reports The Times.
The closure left hundreds of thousands of East Coast residents without ambulance service, 2,500 workers without jobs and many employees cut loose without a final paycheck, report the New York Daily News and the Journal News of White Plains, N.Y.
In California, county executive Smith said if he could start over, he wouldn't sign with the company. Nor would he stay with AMR.
Colorado Springs should scrutinize market factors, including the payment process for patients and insurers, he said. But that information might be difficult to find with such a young company.
Leland wouldn't detail Priority's collection data, but he said the company employs a "very strong billing operation." The company operates in 10 states with about 2,000 employees and has replaced AMR in three markets over the past year, he said.
While concerns have been raised before, he said, Priority "has a perfect record of compliance in all of its existing contracts and all the contracts throughout the life of the company."
If a threat of service interruption looms, Colorado Springs is contractually allowed to take over ambulance service, Leland said.
Priority also would pay the city $3 million to cover costs if the company fails to meet its obligations, city spokeswoman Jamie Fabos said.
AMR has provided city ambulance services for more than a decade, but its contract expires at the end of 2018, Fabos said.
Three companies responded to the city's January request for new bids. A committee ranked them on project approach, organizational background and qualifications and experience, she said.
Specifics on the bids won't be released until a contract is signed.