Aikmus, Helms want firm prices before seeking bids on capital projects

May. 11, 2013 @ 01:09 PM

The Union County Board of Commissioners are pushing for more control over what capital projects are funded.

During its Monday meeting, commissioners were poised to approve the proposed long-range capital improvement plan. Commissioner Richard Helms said some capitol requests come to commissioners as a "wish list" without much detail.

"In some of our capital requests, it basically asks us to fund a project off what I call swag - a scientific wild-ass guess," Helms said.

There is little money in the county budget, so he proposed using the same procurement model used by corporations. He suggested the county get Request for Proposals from vendors for exact costs before the board approved the project. That prevents later adjustments. He also asked that the county includes a scope, range and exact cost for each project.

"By doing an RFP, I can make an intelligent decision on whether this should be funded based on the scope," Helms said.

Aikmus commended Helms for offering a proposal he supported "whole-heartedly."

"The idea of having me set aside money without knowing if its too much or too little, to me is ludicrous," Aikmus said.

"My dilemma is this," Commissioner Todd Johnson said. "If we have a second bid process and say we get three bids. Are folks other than these three allowed to bid on that project?"

If implemented, would there be more than one bidding period, the first to establish cost and another to chose the vendor to perform the work? Or would vendors submit prices to the county once  for a project that had not yet been approved and had no set date to begin? Would the first RFP be formal, as set out by state statutes or would it be a casual cost estimate?

It costs businesses money to bid projects, Johnson said. Some vendors might choose to skip the first bid and enter a low bid on the second RFP. If the lowest bid is much less than the money appropriated, some budget adjustment would be needed anyway, negating the county's advantage.

County Manager Cindy Coto said county staff tries to get the most accurate cost estimates before the project details are brought to commissioners for approval. Every proposal reflects research by employees to nail down specifications and cost.

Because government purchases are regulated by state law, RFPs are not casually issued by department heads.

"It is a very formal process and I have one person who does our entire procurement for Union County," Coto said.

Her staff consults engineers on water and sewer project costs. She turns to state price lists for equipment purchases. Actual work goes into the capital project requests that end up on the commission's agenda, she said. Most of the time, estimates are pretty close to the actual costs.

"I think you know me as a manager that I will do anything that I am requested to do, as long as it's within my capabilities," Coto said. "But going through a full Request for Proposal process or bid process before we even ask for authorization to budget an item, I have to tell you that I do not have the resources to do that within our present structure."

When projects come in under budget, any money is left over is taken back.

"That money gets clawed back," Coto said. "We either use it for something else that the board authorizes or it goes into our fund balance."    

"I understand that there might be a situation with some of the departments that we fund or some of the organizations that we fund where they may ask for $150,000 for one item and it may cost only $120,000," Johnson said. "Eh, we're just going to slide that $30,000 back for a rainy day."

"It doesn't get slid," Coto said.

Finance Director Jeff Yates pointed out that the capital improvement plan includes the scope of each project, justification and the best estimate of cost based on current information. If county departments or outside agencies like Union County Public Schools tries to use county funds for anything other than what commissioners approve, the county can refuse to fund it, he said.    

"Like what Commissioner Helms said, we want to make sure that what we approve is going for that project, not being peeled off and funding other things," Johnson said.

The board's policies do not allow that, Coto said. She and her staff make sure the money is going only to what was approved.

"Do you think some policy changes would correct that?" Helms said.

"I think you already have that," Yates said. "In adopting the CIP tonight, that's what you're putting into place."

If the county put out an RFP before appropriating the money, it would take six months to get bid results back, Public Works Director Ed Gosciski said.

Aikmus argued that budgeting with exact costs eliminates delay in reappropriating leftover money. Gosciski argued that issuing an RFP before budgeting takes the same amount of time as Helms' proposal, negating any time advantage. Plus, few vendors will bid on an unfunded project, especially if bidding costs them money.

"The difference in the private sector is that you build relationships," Gosciski said. "You don't have to bid everything, so you build those relationships with your key vendors."

Crook agreed with Gosciski. State statues outline how RFPs are done.

"We don't have a lot of options," Crook said. "We have to carefully follow the statues. So you can't do an RFP for most all of your purchases. You can't do an RFP for construction. You do informal bids depending on the estimate of the cost and we have to follow those statutory requirements very carefully."

That news frustrated commissioners.

"This is why they say you can't apply common sense to government," Aikmus said. "Because this is common sense and we're just not doing it."

Helms said he did not feel comfortable voting to spend millions on projects he have few details on. Coto said her staff reviews capital requests and include as much detail as possible before presenting them to commissioners for approval. Helms countered that when investigating the core reasons something is needed the reason is "not what it appears to be."

"I honestly can't think of a time that you and your staff...But you don't control all of them," Helms said.

"I control this domain," Coto said.

Helms withdrew his request for RFPs, but commissioners asked Coto to develop a procurement policy that gave the board the level of detail commissioners wanted.

In her closing comments, Coto recalled the county's accomplishments mentioned by the commissioners earlier in the meeting.

"I just wanted to acknowledge that I work with an amazing staff, and I'm very fortunate to do so," she said. "But none of that would be possible without the trust, respect and relationship that we have with our board and you all establishing the vision."