Arguments heard in procurement process suit

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A judge said Wednesday he will rule as soon as possible to determine if the city should be allowed to proceed with the projected $18 million renovation of the Municipal Building or be prevented from doing the project as it intends.



The issue arose when John Z. Speer Jr. and the Augusta-Richmond County, Georgia Property Owners Association filed suit against the city and its commissioners last month. The plaintiffs have attacked the city's method of procuring overseers for the major construction projects funded by the Special Purpose Local Option Sales Tax.

Each side got a chance to present its arguments in Richmond County Superior Court to Chief Judge J. Carlisle Overstreet.

Augusta Procurement Director Geri Sams testified Wednesday that the city can use the process known as "construction manager at risk" because the commission voted to do so in October 2004. She admitted, however, that construction manager at risk is not a procurement process allowed by the city's code.

Sams testified that the process for selecting the construction manager at risk is competitive. The first bid is issued to find businesses qualified to perform the job, and the second phase is to find the best qualified.

Questioned by plaintiff's attorney John Long, Sams said McKnight Construction scored below other companies on a bid to build a private terminal building at the airport because it lacks some qualifications the city wanted for the construction manager at risk - even though McKnight built the airport's much larger main terminal.

City Administrator Fred Russell testified he supports the city's use of construction manager at risk for SPLOST projects because the city can save money and get projects done more quickly. The construction manager at risk is hired to work with the architect to design and create a project that meets the city's specifications. The construction manager at risk tells the city what its price will be after it gets the contract.

Asked why the city couldn't have gotten the architect's design for the renovation months ago and used a sealed competitive bid, Russell said the design would have had to be redone because of the recent government reorganization.

Both Sams and Russell testified that the use of sealed, competitive bids is not always best. A government wants the best quality and that doesn't always come at the lowest price, both said.

One outcome of the city's use of construction manager at risk, however, is that small and mid-size construction companies are basically locked out the competition, testified Robert L. Meybohm, who worked in commercial real estate for 22 years. The city is judging companies on style and presentation instead of their ability to do a job at a reasonable price, he said.

Speer put it more bluntly Wednesday afternoon: "I think that the evaluation system is a joke."

Forrest White of Heery International, which has a contract potentially worth more than $7 million to oversee the city's SPLOST projects, testified that delaying the Municipal Building's renovation for three months could increase the cost of the project by nearly $1.58 million.

Rick Acree, who is in charge of the city's facilities, estimated extra rent payments of $104,000 if the outside city offices can't move into the renovated space for an additional year.

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microprill
2
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microprill 05/11/11 - 08:35 pm
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crooked Augusta @ work again

crooked Augusta @ work again

Riverman1
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Riverman1 05/11/11 - 08:50 pm
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"Both Sams and Russell

"Both Sams and Russell testified that the use of sealed, competitive bids is not always best. A government wants the best quality and that doesn't always come at the lowest price, both said."

In other words, they don't want any type of secret bids that are based on fair and objective criteria. If you want a certain degree of quality, then you put that in writing and make sure the stipulations are met by all bidders. To condescendingly say we want the best quality without giving the criteria simply means we want to award contracts to whom we want based on nothing we can describe to all bidders.

corgimom
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corgimom 05/11/11 - 09:02 pm
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Speer put it more bluntly

Speer put it more bluntly Wednesday afternoon: "I think that the evaluation system is a joke."

Agreed!

dorisday
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dorisday 05/11/11 - 09:25 pm
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"because it lacks some

"because it lacks some qualifications the city wanted "....Read: they are not minority owned.

pointstoponder
139
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pointstoponder 05/11/11 - 10:39 pm
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By the way Doris, if you look

By the way Doris, if you look at the CM contracts awarded, they have not gone to minority owned firms. The selected firms do have experience with the CM process. Once the CM is selected based on professional qualifications, all subcontracts and suppliers are selected competetively and Procurement monitors the process. If you look a little deeper, you will see the out of town CMfirms use as much local participation in the projects as the local GC's and CM's.

Willow Bailey
20240
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Willow Bailey 05/11/11 - 11:04 pm
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The county's business model

The county's business model is prime for, illegal, shall we say referral fees more commonly known as the kick back system.

Insider Information
4009
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Insider Information 05/11/11 - 11:33 pm
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1) How many lawsuits has the

1) How many lawsuits has the procurement department procured?

2) The story doesn't say, but anybody want to bet that our illustrious law department had to hire an attorney to represent us in court?

Procurement Department + Legal Department = Economic stiumlus for the legal community

Riverman1
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Riverman1 05/12/11 - 04:54 am
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Pointstoponder said, "The

Pointstoponder said, "The qualifications Augusta is looking for is experience with CM."

Then put what experience is required in writing clearly defined for potential bidders instead of going on what someone in procurement FEELS is right. If a company is not allowed to compete and feels their being denided was wrong based on the criteria, they will have legal recourse.

Awarding contracts on what county officials personally feel is best is only another way of making them the poweful ones passing out the contracts instead of having a fair bidding process.

pointstoponder
139
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pointstoponder 05/12/11 - 06:15 am
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Riverman, the requirements

Riverman, the requirements are spelled out clearly, along with the evaluation criteria, in the request for qualifications. Preproposal conferences are held to give vendors a chance to ask questions and clarify requirements. Answers are distributed in writing to all vendors, not just the ones asking. Statements of qualifications are reviewed and scored by a panel made up from multiple departments, not just procurement.

This process is used all over the country for public and private construction projects. Contracts for professional services are routinely based on qualifications. With the complexity involved in building automation as well as security and detention systems the contractors need to be judged on their professional qualifications and experience. The evaluation criteria is both objective and subjective, and pricing is a component. These people are evaluated based on information THEY provide. This is a case of a contractor, who has performed poorly on major project, throwing a tantrum.

By the way, the cost of these delays and attorney costs are taking money away from taxpayers pockets as well. The only winners at this point are Jack Long and his minions.

Seems as if most of the posters here are, as is often the case, jumping on the bandwagon with no idea what tune is playing.

Brad Owens
3637
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Brad Owens 05/12/11 - 09:25 am
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Hmmmm, looks like something

Hmmmm, looks like something is no adding up here.

dorisday
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dorisday 05/12/11 - 10:08 am
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I am no fan of McKnight's,

I am no fan of McKnight's, and no fool. Procurement is rife with special deals. If Sams was any other color, or sex, she would have been gone years ago.

dani
12
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dani 05/12/11 - 10:36 am
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I say keep the jobs at home

I say keep the jobs at home when at all possible.
And if it is true that a company double bills, the person paying the bills should correct the invoice and pay only the amount owed (I assume someone checks the bills before payment?), and NOT use it as an excuse for denial.

Insider Information
4009
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Insider Information 05/12/11 - 10:44 am
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pointstoponder, I assume that

pointstoponder, I assume that the dozens of other lawsuits filed against the procurement department in the past three years are all frivolous as well?

If so, can we assume that you work either in that department, in the legal department, or for one of the companies benefitting from the cronyism and nepotism?

Riverman1
70336
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Riverman1 05/12/11 - 10:57 am
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"Riverman, the requirements

"Riverman, the requirements are spelled out clearly, along with the evaluation criteria, in the request for qualifications. Preproposal conferences are held to give vendors a chance to ask questions and clarify requirements. Answers are distributed in writing to all vendors, not just the ones asking. Statements of qualifications are reviewed and scored by a panel made up from multiple departments, not just procurement."

"This process is used all over the country for public and private construction projects. Contracts for professional services are routinely based on qualifications. With the complexity involved in building automation as well as security and detention systems the contractors need to be judged on their professional qualifications and experience. The evaluation criteria is both objective and subjective, and pricing is a component. These people are evaluated based on information THEY provide. This is a case of a contractor, who has performed poorly on major project, throwing a tantrum."

Pointstoponder, you go into this long spiel that the requirements are spelled out clearly. You say contracts are routinely based on qualifications. Then you say: "The evaluation criteria is both objective and subjective, and pricing is a component."

We are back to square one with this subjective evaluation. Let me type this real slowly and you will get it, hopefully. ANY criteria used should be spelled out ahead of time and objectively judged, not subjectively. If a company with a lower bid is denied the contract, there HAS to be a clear violation of the carefully delineated conditions. If they desire to challenge the rule that makes them ineligible to bid or their lower bid unacceptable the county must be prepared to defend the decision with OBJECTIVE evidence.

You simply cannot have ANYONE awarding contracts based on their subjective reasoning or whims. They may enjoy the power, but it's not how it should be done. Don't you get this?

pointstoponder
139
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pointstoponder 05/12/11 - 12:53 pm
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Riverman, have you seen the

Riverman, have you seen the Request for Qualifications? Do you know the scoring criteria? If not, I submit that you do not have a clue and are basing your opinions solely on articles in this publication. When choosing vendors for professional services, there is always a subjective component.

Just because someone submits a low price does not mean it's a good deal. You can buy a Rolex out of the trunk of a car for a fraction of the price of a jewelry store. Does that mean you got what you thought you paid for? Objectively, based solely on price, you got a deal. How long is the waiting list for a minimum wage brain surgeon or lawyer?

The taxpayers of Augusta are still paying the cost for low bid contracts rather than best bid.

Insider Information
4009
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Insider Information 05/12/11 - 01:41 pm
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No response? Exactly.

No response? Exactly.

wondersnevercease
9155
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wondersnevercease 05/12/11 - 01:59 pm
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LOL....big old gorilla in the

Unpublished

LOL....big old gorilla in the room................

Riverman1
70336
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Riverman1 05/12/11 - 03:12 pm
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Pointstoponder said, "When

Pointstoponder said, "When choosing vendors for professional services, there is always a subjective component."

Pointstoponder, why do we even have a bidding process and conditions described in writing if it comes down to someone SUBJECTIVELY choosing a certain vendor? Just throw it all out and let it be known the contract will be awarded on the sole opinion of so and so.

When contracts are made it is always what is written in the contract that matters. Because someone said this and that doesn't count. The contract generally speaks for itself with the written offer and acceptance. The county bidding process should also be about what is in writing.

You keep coming back to these conditions that you say are important such as experience of the company and so on. Fine, simply put the required experience as a stipulation in writing. Ditto for other matters. Then if the low bidder is denied the contract he can pursue legal remedies if the process wasn't fair. If the conditions are geared to eliminate perfectly legitmate companies and bids, then they can, again, seek legal remedy.

A written and clearly defined algorithm with the amount of the bid being key should be followed to the T in choosing the vendor.

dani
12
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dani 05/12/11 - 07:17 pm
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I think we have a Donald

I think we have a Donald Trump in the procurement Dept.
A one person decision maker.

pointstoponder
139
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pointstoponder 05/12/11 - 09:56 pm
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Insider, I don't work for

Insider, I don't work for Procurement, the legal department, or one of the "companies benefiting from the cronyism". I am, however, familiar with the construction industry and the topic of Construction Contracting and Management.

As for cronyism, I'm not quite sure how you can pin that label on a process that has resulted in 3 different contractors for 4 projects. It will be 4 different contractors for 5 projects if the recommendation holds for the Municipal Building. Is that what you might call a subjective judgement?

I would say that some of the lawsuits are frivolous. I cannot speak to all. The one that really got the ball rolling as far as getting a few attorneys anxious to feed off the public trough was, in my opinion. The basis of the complaint was that a bid bond was not a material document. I have not spoken to anyone in the industry that buys that arguement.

Please note that I am not opposed to strict low bid at all. On smaller
construction projects and procurment of supplies, absolutely. As projects get more complex and specialized, the taxpayers get a better value from professionals with experience. It is also a huge benefit when all parties involved in the process are part of a team rather than dealing with an adversarial relationship.

Riverman, we are not back to square one. If you believe we are, you simply do not seem to have a full understanding of CM at Risk.

CM at risk involves selection of the Construction Manager based on criteria set forth in a Request for Qualifications (RFQ). Those qualifications typically are experience of the firm(overall and with a specific project type), experience of the individuals that will be assigned to the project, financial stability, resources available to accomplish the work and a number of other factors, including their estimated overhead and fee (please keep in mind that this is happening before the project is designed). The scoring placed on each of these is spelled out in the RFQ The firms submit a document that shows how their firm (or possibly a partnership of two or more firms) meets or exceeds these criteria.

These statements are evaluated by a panel from multiple departments and scored based on the information provided by the firms and a check of references and financial statements. Some of the scoring is quite objective, other aspects such as the relative experience and expertise of one firm relative to another is somewhat subjective. The scores are then added and a few firms are "short listed" and invited to do a presentation before the panel.

The presentations are scored in the same way as the statements. and a firm is recommended to the Commission for approval. The design firm selection happens in much the same way. Then the team of contractor, designer and owner design the building based on the program established for the structure. The CM reviews the plans for cost control and constructability while the owner makes sure the building meets the needs of the end user.

As the plans get closer to completion, competetive subcontractor pricing is solicited just as you would in a hard bid. Sometimes schedule is critical and site and structural design is far enough along to bid early award packages so that construction can begin as plans are being completed. This saves time, and that reduces project overhead. When plans are complet, final pricing is competetively solicited from subs and a Guaranteed Maximum Price (GMP) is established and approved by Commission. This reflects the MAXIMUM price the owner will pay. If costs are less, the owner gets the savings. If they exceed the GMP, the risk and loss goes to the CM.

Since the fee to the CM is set, there is no incentive to cut corners or push for change orders as their bottom line doesn't change. I have participated in projects involving conventional design/bid/build, design/build, and CM. All have their place, but based on almost 40 years in the contruction industry, CM is a superior method for delivering a better product on time and at budget for major projects that tend to be complex in terms of construction and phasing.

Brad Owens
3637
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Brad Owens 05/13/11 - 12:00 pm
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P2P, I would challenge you on

P2P,

I would challenge you on a couple of points here. In all the years I have been in and around giverment contracting (since 1995) I have never heard of a "subjective" bid process. Also, positions like the CM Risk manager or whatever it is called seems to me like a waste of money not needed at all.

The point RM1 is making is that if you are going to have bids, put our RFP, RFQ, RFB's it MUST be set out clearly what the bid is for, the requirements to bid, and the bid criteria.

If it is not, and bids can be rejected on 'subjective' things, it is all in how you look at it.

Let me give you a good example I know of first hand.

A long time uniform provider to the city was the low bid for a AFD uniform bid. The Dept rejected his bid because they said the type of hat he offered did not meet the criteria of the bid. It required "solid" blue baseball hats, and his had a dark green under brim (that is the part that you cannot see when wearing the hat) so he was rejected and it went to a uniform company owned by the family of a late state legislator.

Now, I looked at the hat and it was solid blue but the under brim was green (which is common in hats I might add), but the 'subjective' view of what the word 'solid' means, allowed someone who wanted to give the bid to one company over another, to do it. Is that fair? It allowed it to be taken from the low bidder, and given to another company with the 'right' criteria because someone found a way to make them disqualified.

Now, I think that it is funny that someone puts the criteria in the RFB and then finds one part out of hundreds of items, to reject the entire bid and award it to politically connected businesses instead.

Is THAT fair? No. Is it LEGAL, yes.

I am not sure who is to blame, but I feel it is the Commission.

Brad

pointstoponder
139
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pointstoponder 05/13/11 - 05:21 pm
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Brad, Sorry, but comparing CM

Brad,

Sorry, but comparing CM to uniforms and hats is pointless. As i have stated previously, the criteria IS published in the RFQ. No one is rejects based on subjective scores. I understand Riverman's point about the criteria, and am saying that the criteria is specifically included in the RFQ. I don't know how to state that any more clearly.

The firms' qualifications are scored based upon the information provided by the respondant. Firms have been deemed non-compliant for failure to meet the specific response requirements (forms, notarization, number of copies, etc) and their proposals not considered, but this is an objective criteria. The submission is in compliance or it isn't.

Quite frankly, your example of the solid blue hats makes my point. The green brim, even though it was on the underside, meant the hat did not meet a specification calling for solid blue. Had they awarded the bid to the company with the green underside, the firm with the solid blue hat would have very reasonable grounds to protest the award. In that instance, the firm with the green brim could have asked for clarification BEFORE the bid on the hat they intended to submit. They could have also asked for that to be permitted as an alternate. This was an objective rejection, not subjective.

Riverman1
70336
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Riverman1 05/14/11 - 01:12 pm
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Pointstoponder, you are

Pointstoponder, you are trying with me as I am with you. It's now become a civil discussion. You are explaining well about the RFQ and it sounds like a good measure. But you are still hitting on some things being subjectivly decided. Indeed, the whole "scoring" process sounds borderline personal preference.

What the public desires is to take the contract awarding process out of the hands of a few individuals. The public desires hard set rules to determine who can bid and then generally have the contract to go to the low bidder. What happens now is that artificial conditions can be created to keep certain bidders out or to give the contract to a higher bidder.

The conditions must be necessary and not designed to eliminate perfectly legitimate bidders. Simply being a new company bidding should not be one of the criteria to cause elimination. We should strive to have new bidders willing to work cheaper instead of the same people constantly getting the contracts and often building relationships with the contracting people. That's what this is all about.

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