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RALEIGH - The General Assembly spent $110,000 on a study of retreaded tires by one of the world's premier researchers, then passed a reform measure last week that ignores one of the consultant's key findings.

Supporters of more aggressive reform believe the loophole could cost taxpayers hundreds of thousands of dollars in needless expense during the next few years.

And some say the whole episode raises questions about the integrity of state government's purchasing system, which gives significant leeway to Raleigh bureaucrats in selecting products distributed statewide to schools and state agencies.

"Since when do we give the people that work for us the option of buying what they want like that?" asked state Rep. Nelson Cole of Rockingham County, a retired automotive dealer who has been pushing to reform the state's tire-buying practices since 2002.

Cole introduced a tire-reform measure in May that included all major recommendations made by Smithers Scientific, the internationally known research company that spent months studying North Carolina's contract for retreaded tires.

The Reidsville legislator expressed mixed feelings about the diminished version of his original proposal that emerged last week. He's disappointed that it lacks one of Smithers' most basic recommendations - that the state's tire business should go to the lowest bidder without regard to what retreading process the winner
uses.

Instead, the new law will allow the state to specify use of a tire produced by its long-time contract holder, White's Tire Service of Wilson, that has proved significantly more expensive in recent tests.

But the new measure does make some important strides, Cole said. It leaves an opening for White's competitors to get at least part of the state's business.

And Cole said he is particularly pleased that the new rules prohibit charges for questionable "spot repairs" to tires that are being retreaded, a surcharge of up to $36 per tire that was flagged as excessive in a 2006 report by the State Auditor's Office.

The auditor estimated the repairs cost taxpayers up to $362,000 a year in questionable charges by White's Tire.
"It's a work in progress," Cole said of the reform measure that passed both houses Thursday, suggesting he will try next session to get the remainder of Smithers' recommendations adopted.

The focus of Smithers' study and the new legislation is the state's contract for retreaded bus and truck tires, worth up to $4 million a year in sales. State law mandates the use of retreaded tires to conserve a valuable resource, save money and slow the accumulation of spent casings in landfills.

The contract covers roughly 30,0000 recycled tires bought each year for use on the rear wheels of county-owned school buses and vehicles belonging to the state Department of Transportation.

The contract has been held in full or part for 30 years by White's Tire, the focus of bitter complaints by others in the industry. Competitors contend that state administrators have developed a "sweetheart" relationship with the Wilson company that ultimately hurts taxpayers.

They claim that White's Tire gets unfair leverage on tax dollars with its use of a "bead-to-bead" retreading process that is relatively uncommon in the United States. White's Tire contends its product is superior and has support from many of its customers, including some DOT officials.

Cole and others contend it's a classic case of "the emperor has no clothes," where a product's mystique belies its actual performance.

Indeed, so far, White's bead-to-bead has not lived up to its reputation in head-to-head competition.

Smithers' exhaustive study found no difference in quality, durability, performance or customer satisfaction between White's bead-to-bead and its competitors' products.

But the bead-to-bead turned out to be at least 40 percent more expensive to operate than three of the four other tires tested, Smithers found.

Smithers' study corroborated results from an earlier study by the Guilford County school system, which tested White's bead-to-bead against tires retreaded by Snider Tire of Greensboro and BesTreads of Winston-Salem.

Such tests have only a limited value, said Robert White, whose family owns the Wilson company.

"Smithers is a fine company and they are very nice people," he said in a recent telephone interview. "But the people you should be talking to are the users of our product."

But if White's signature tire is so great, why aren't all the state's cost-conscious and performance-oriented truck fleets using it, wonders Dan Rice, president of Piedmont Truck Tires.

Instead, such companies with major fleets as Food Lion, FedEx, Ryder, Roadway and Smithfield Foods use retreaded tires Rice's company makes in a completely different process.

Similarly, Snider Tire has such clients as Estes Express, Epes Transport, UPS, Ryder, Kenan Transport and Eagle Transport.

In the past, state administrators have written the tire contract in ways that favor the Wilson company, even down to the type of rubber they specify, Rice said.
That denies state taxpayers the benefit of working with other companies that might save them significant amounts of money, Rice said.

"I just think it should be bid fairly so everybody gets the same chance," he said. "If we get it, fine. If we don't, that's life, but at least we have a shot."

The General Assembly debate that led to the compromise bill was sometimes misinformed.

State Rep. Phillip Haire of Sylva argued for the White's Tire product in one committee hearing by saying that tires made by other processes were less safe and responsible for the strips of shorn tire tread that often litter the highway.

"A pre-cut is what you see by the side of the road," Haire said, referring to the standard method of tire retreading.

Haire was wrong on both counts, according to Harvey Brodsky, managing director of the Tire Retread and Repair Information Bureau, a trade group based in California.

What are sometimes called roadside "gators" happen when drivers do not properly care for tires, whether they are new or retreaded and without regard to the retreading process, Brodsky said.

And there is no proof that one retreading process produces a safer or more reliable product as long as the competing tires are made in quality-conscious shops, he said.

"If anyone within or outside the retread industry can provide reliable scientific data proving otherwise," Brodsky said, "I would love to see it."

Staff writer Mark Binker contributed to this story.

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