INFLUENCE PEDDLING OR INCOMPETENCE EATING UP CITY $?

By Juan Montoya
The latest change order boondoggle involving the improvements to the terminal building at the Brownsville-South Padre Island International Airport is but the tip of the iceberg of the shenaanigans going on in the city's purchasing department.

Contractors no know that – in the legacy of former city manager Charlie Cabler and purchasing agent Robert Luna – the first bunch of cash to spend is the contingency fund structured into in every city project. Then they can go about the business of eating up the construction bid they placed to get the job. Below is a list of the sorry state of affairs involving change orders in city projects.

* The latest change order recommended by purchasing and approved by the city commission at their last meeting was  for CH2MHILL of Englewood, Co. that increased their fees from $1,650,000 to $2,500,925, a $850,925 increase.

The new additions to the passenger terminal area were added by the city and its local architect, Origo Works, increased the original size from 65,000 square feet to 85,000 square feet. Also, the Custom and Border Protection asked that the original 14,000 square feet be increased by 9,000 square feet for Federal Inspection Service (FIS) areas to 23,000 square feet.

Those changes, said James Kirshbaum, the engineer for CH2MHILL, were not in the original engineering specs provided to the company when it submitted its response to the city's Request for Proposals (RFP). As a result, he said, not only the cost of the engineering services, but the changes in the original design will balloon the original construction cost estimate from $27.5 million to $38 million.

In the original letter, the Kirshbaum stated that the changes in engineering/design cost, a five-month delay, and the and overall construction cost were due to changes after the RFP were approved.

"The other item that has caused additional design and management effort is the coordination with our local architect, Origo Works," wrote Kirshbaum, the engineer for CH2MHILL.
"As requested by the mayor, we engaged Origo Works to help incorporate 'local' architectural features and elements into the original design. This effort extended the conceptual design phase of the project by approximately five months, resulting in significant additional efforts by CH2M, Corgan and Origo Works."

That entire paragraph has been removed by the later insertion of the second letter which deletes any mention of the mayor or Origo Works. Both letters are dated Sept. 21 and signed by  Kirshbaum Sept, 6.

However, in the commissioners' agenda backup, CH2MHILL lists payments made, not to Origo Works, but to Jaime Huerta, its owner, of $25,000 under Current Terminal Contract, $15,000 under Revised Terminal Contract, and another $5 for Terminal 55 Contract for a total of $45,000. Huerta's company lists the mayor's Spanky's Burgers and El Rincon de la Paz among its completed work projects.

*And how about the gravy lapped up by Ziwa Construction working on the new Brownsville Community Resource Center? That building is the old Mother of Perpetual Help building renovation project at the corner of Madison and Sixth streets.

Luna, of the Purchasing Dept. and City Engineer Carlos Lastra placed an item (that passed) on the city commission agenda calling for a sixth change order on the project that sent the cost soaring to close to $1 million.

The original contract to renovate the building into something that will be called the Brownsville Community Resource Center was for $880,000. Contained within that contract was $53,475 for a "contingency" fund. That fund – except for $12,639 – has been gobbled up by four change orders that totaled $40,835.

Then the  contractor said he needs an additional $82,919 that will deplete the contingency fund and will require $70,279 to do the job right.
That will make the cost of rehabilitating the old Mother of Perpetual Help building to a staggering $953,754, almost $1 million.

Now, some would say, wouldn't it have just been better to get a brand new building with that $1 million?

* Another fiscal disaster is the ongoing drain on city general fund by the construction of the Stegman Building Performing Arts Academy on the corner of 11th and Washington that has  gone through more than a $500,000 in change orders since they started the job.

The building has literally been gutted and only the shell remains. But  the commissioners approved a change order for $247,435.The original contract cost was to be $5,030,600 with a "contingency fund" of $306,400.

However, the contractor – Alpha Construction of Harlingen – went through that sum like a hot knife through butter in seven change orders. Since it was part of the "contingency" fund included in the original contract, the change orders did  not have to get commission approval.

After having gone through that, the contractor and city officials had to come back to the commission and get an additional $247,435 for the eighth change order for another $247,435 that includes another $100,000 as a "contingency."

With the approval of the last change order, it means that they got and additional $553,835 added to the original contract price of  $5,030,600 and that the project will end up costing a total of $5,584,435.

When is the hemorrhaging of the public's money going to stop? Are "contingency" funds just a round about way to put more money in the pockets of contractors in cahoots with city staff?

One or two cost overruns could be understood. But this has become a clear pattern of either connivance or incompetency on the city side.