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Murder Leads To N.J. Probe Into Bus Deals

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It is fitting that Frank L. Black and Alan Mackerley got to know each other on a school bus.

Both men's fathers were transportation contractors in Sussex County, N.J., and they met years ago when Mr. Mackerley was a teenager riding a bus driven by Mr. Black.

But the camaraderie of those early encounters evaporated in the intervening decades, as the two men assumed control of their families' bus businesses. In its place arose a rivalry so intense and bitter that authorities believe it ended in murder.

In a crime worthy of a TV drama, the 53-year-old Mr. Mackerley stands accused of fatally shooting Mr. Black, 58, in February after luring him to Florida with bogus promises of a bus deal. Afterward, prosecutors charge, Mr. Mackerley dumped the body from his speedboat into the Atlantic Ocean more than a dozen miles from shore.

Although the feud had long been building, authorities believe it took a lethal turn when Mr. Black snatched away a long-held contract of Mr. Mackerley's after underbidding him by nearly half.

Not surprisingly, this tale of American capitalism gone awry has dumbfounded the many northern New Jersey educators and parents who relied on the two contractors to transport their children to school.

And less predictably, it has triggered an investigation into school transportation practices statewide. The probe by the State Commission of Investigation is focusing on whether New Jersey is suffering not from open warfare among contractors, but from a suspicious dearth of competition in districts throughout the state.

"This particular tragedy really blew the lid off this in terms of publicity and attention," said Lee Seglem, an executive assistant to the Trenton-based commission. "But even apart from the murder, there are a lot of legitimate questions that need to be raised and examined."

Territorial Ambitions

On its face, an investigation into possible collusion among contractors seems an unlikely outgrowth of a murder that authorities allege was prompted by an example of competitive bidding by Mr. Black.

What explains that apparent incongruity is the context in which the competition occurred.

It's not that battles for routes among New Jersey's roughly 300 private school bus contractors are unheard of. In some cases, school officials find themselves with multiple companies vying hard to underbid each other.

But according to many industry observers, such rivalries are more the exception than the rule. Contractors, they say, often will decline to bid on routes that are seen as "belonging" to another company. And they expect the same courtesy in return.

On some occasions, such behavior is said to stem from explicit back-room deals, and may involve phony bids designed to create the appearance of competition where none exists. In other instances the deals are more tacit, reached informally as contractors share drinks or social outings and agree that nobody wins when they're driving down prices with cutthroat competition.

So when Frank L. Black Bus Service Inc. took away a contract long held by Mr. Mackerley's Byram Bus Line Inc. to transport about 150 students from Morris County's small Mine Hill school district, prosecutors say that Mr. Mackerley saw it as an egregious violation of the code. And in Mr. Mackerley's eyes, they say, Mr. Black had breached that code too many times before.

"To say he despised Frank Black is probably an understatement," said William J. Anderson, a former airline pilot and school bus contractor who was Mr. Mackerley's best friend for many years. That friendship ended last summer when Mr. Anderson told authorities that Mr. Mackerley had confessed the murder to him six months earlier.

Mr. Mackerley's lawyer could not be reached for comment last week.

For years, the New Jersey School Boards Association has complained that districts too often go begging for bidders when seeking more than one proposal for their bus contracts. A survey taken by the association found that roughly half of the 350 Garden State districts that rely on outside vendors for their transportation get only single bids, often from contractors who have had their accounts for many years.

"Obviously, that's not competitive," said Frank Belluscio, a spokesman for the association. "It's something that warrants investigation."

Representatives of the state's school bus contractors call such complaints far-fetched.

"If there are incidences where there is only one bidder, it's a purely economic decision," said Mary Mazzochi, the executive director of the New Jersey School Bus Owners Association, a trade group. Contractors' decisions on whether to bid on a route are influenced by such factors as distance and availability of equipment and drivers rather than issues of territory, she said.

"If you have to travel 45 minutes just to get to and from the route, you have to make a decision whether it's worth it," she said.

Yet school officials say their suspicions are justified in part by statistics suggesting that New Jersey spends far more than other states to transport students--figures that school bus owners contest. ("Dearth of Reliable Data on Bus Costs Makes State Comparisons Tough," This Week's News.)

Past Convictions Cited

Throughout the 1980s, more than a dozen districts in four New Jersey counties were implicated in a series of busing-related scandals. Uncovering evidence of kickbacks, bid-rigging, and other fraud, prosecutors secured guilty pleas from a handful of local school board members and transportation coordinators. They also sent several contractors to prison on charges involving collusion, corruption, and other crimes.

State Sen. Gordon A. MacInnes, a Democrat, cited those earlier prosecutions when he called on the State Commission of Investigation to conduct a broad probe of school bus contracting in the wake of Mr. Mackerley's arrest by Florida authorities in August. The region Mr. MacInnes represents includes the Mine Hill district.

"Reports are rampant that companies routinely carve up the turf of school bus routes to avoid true competitive bidding--at great cost to taxpayers," Mr. MacInnes wrote the commission in a letter urging it to undertake the probe. "New Jersey taxpayers are the ones being taken for a ride by a school bus industry which seemingly enjoys unchallenged access to public funds."

As the commission pursues its probe, New Jersey school officials await the outcome of the murder case.

'Admiration Society' Formed

Authorities have laid out a scenario suggesting that Mr. Mackerley's girlfriend set events in motion last winter by posing in a series of phone calls as the representative of Chilean businessmen looking to do business with Mr. Black.

According to court papers filed by the Florida Department of Law Enforcement, she dangled the prospect of a highly profitable deal to entice Mr. Black to fly to West Palm Beach.

Once Mr. Black had taken the bait, Mr. Mackerley allegedly shot him in the head in the front room of Mr. Mackerley's home in Stuart, Fla., while holding him in a headlock. Authorities assert that Mr. Black had been drugged beforehand with a colorless, odorless drug that can render people semiconscious or knock them out.

Mr. Anderson, the pilot, told investigators that he learned of the crime after Mr. Mackerley asked him to fly over the ocean to see if Mr. Black's body, which has not been recovered, had surfaced.

Mr. Anderson entered the bus business in New Jersey as a sideline in 1979 at Mr. Mackerley's urging, then sold the business in 1988. He owns a home near Mr. Mackerley's in Florida.

Since June, Mr. Mackerley's girlfriend has been held in the Martin County, Fla., jail on a contempt-of-court charge stemming from her refusal to talk with investigators. Mr. Mackerley remains in jail awaiting trial on murder and kidnapping charges. He could face the death penalty if convicted.

The crime allegedly stemmed from a deep grudge Mr. Mackerley held against Mr. Black, based in part on a perception that Mr. Black did not play fair.

Mr. Anderson, who admits he did not like Mr. Black, said Mr. Mackerley and other school bus contractors were convinced that in addition to poaching on other companies' territory, Mr. Black cut corners on his contracts.

On occasion, Mr. Anderson said, he and other allies of Mr. Mackerley joined forces to tail Mr. Black's buses in hopes of documenting violations. Mr. Anderson jokingly referred to this loose-knit group as "the Frank Black Admiration Society."

Busing Seen in New Light

The case has received extensive publicity in New Jersey, rocking the pupil-transportation industry and hitting home for many school officials.

"Both of these gentlemen were in my office," Ernest Palestis, the Mine Hill superintendent, recalled in a recent interview. "When we see the names in the newspaper, these are real people to us."

Larry S. Feinsod, the superintendent of the 2,000-student Madison school system in Morris County, shares that personal connection. When Mr. Feinsod held the top job in Mount Arlington, another district in the county, Mr. Mackerley was the bus contractor. He provided exemplary service, Mr. Feinsod said, which made the murder charges even more shocking.

Based in part on his firsthand impressions of Mr. Mackerley, the Madison superintendent said he was reserving judgment. But he said there was one thing he was sure of: The case has changed the way he and other area school officials think about their bus contracts.

"Prior to this, it all seemed very black and white to me, a matter of course," Mr. Feinsod said. "I realize now that there may be very much more to it than that."

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