City Council Questions Cost Overrun Before Paying Paving Bill

 12/05/2017 - 13:23

Saline City Council voted 6-0 to pay $356,057 to DN Higgins, Inc., for sidewalk, pavement and parks projects completed this year. But the payment came with some criticism and concern.

DD Higgins completed a number of projects in 2017, including:

  • The downtown parking lot beside Benito’s.
  • The drives in Oakwood Cemetery.
  • Sidewalk and drain repair in Torwood.
  • West Bennett Street road work.

The projects came in considerably over budget. The parking lot was $15,000 over budget. City Superintendent Gary Roubal chalked it up to the increased cost of asphalt. Council was more concerned by the $50,000 cost overrun for the drives inside Oakwood Cemetery. Midwestern Consulting, payed $47,725 by the city to administer, test and inspect the project, made a mathematical error that caused the city to underbudget for the work. When completed, the project cost $177,000.

Resident Mary Hess pointed out the $50,000 discrepancy during public comment. Councillors Dean Girbach, Christen Mitchell and Janet Dillon also questioned the error.

“What language is there in the Midwestern contract that states who is responsibility when they make an error. We’re paying Midwestern $47,000 to make sure they do the work correctly,” Girbach said. “Do we need to make adjustments to our consultant contracts? We pay a lot of money to consultants and then you look at the Rec Center, the DPW roof. At what point do you say, wait a minute, we paid you to do it?”

Mitchell had a similar question.

“I’m curious, when a mistake like this is made, do they take away liability? Is it in the contract? I’m worried about accepting further liability because of mistakes they made. We make an effort to be good stewards of the public’s finances,” Mitchell said.

City Manager Todd Campbell said that Midwestern estimated the price on 3,000 square feet of drive instead of 6,000 square feet. But, he said, at the end of the day, despite the error, the city was simply paying for work that needed to be done. Campbell said that at times the city will go back to consultant or contractor to recoup funds.

“It’s on a case-by-by case basis, depending on the circumstances and the magnitude of the problem,” Campbell said.

Mitchell asked how future errors might be caught ahead of time. Roubal said it would have been very difficult for city staff to examine the documents and spot this error.

Council eventually voted 6-0 (Jack Ceo was absent) to approve the payment.

“They (Higgins) performed what was asked of them. We’re paying for services rendered at a high quality,” Mayor Pro-Tem Linda TerHaar said.

Despite the overruns, Roubal said using Higgins for all the projects provides economies of scale savings. He said he was also pleased with the quality of the work.

Planned projects for the spring include paving of Harper Street and Colony Court and converting the People’s Park tennis court into a parking lot. The city has $374,000 budgeted for the work.

 

Tran Longmoore
Tran Longmoore is owner of The Saline Post. Email him at tran@thesalinepost.com or call him at 734-272-6294

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Comments

salinesal's picture

Why does everyone act so uninformed on city council? These professionals have Errors and Omissions Insurance. It is exactly for errors like this. Why not go after it? Is it because you really do not care about over spending with the peoples money?

Dell Deaton's picture

Admittedly, this was a little hard for me to follow as it unfolded during the Council Meeting last night.

Did the now-completed Oakwook Cemetery project come in "over budget"? Technically it looks like that. But it might be more accurate to say that the specifications weren't properly set out at the start. As part of its bid, I suspect that winning contractor DD Higgins had made some provision to be paid based on actual work performed — perhaps even both more and less — depending on what it would be able to determine in process. No problem with DD Higgens, then, as far as I can tell.

Who was responsible for getting the bid materials correct in the first place? The City hired Midwestern Consulting to do this as one part of an arrangement to "administer, test and inspect the project." Could or should someone from City staff confirmed the specification numbers? It sounds like this would not have been practical — short of perhaps following Midwestern real time and checking its numbers each step of the way. No problem City-department-side, then, again, as far as I see it.

So— how was the City "harmed" here? 

As was pointed out one or more times last night, the Cemetery project would have gone forward even if the higher cost had been known up-front. And it would have been done as part of the DD Higgins collective project award for 2017. I didn't hear any argument that another contractor would, should, or could have been preferred if the current cost number had been known earlier. What the City authorized for payment last night was, all agreed, what the work was worth. To that extent, Saline was not harmed, and thus Midwestern wouldn't be responsible for payment of any part of "the $50,000 cost overrun for teh drives inside Oakwood Cemetery."

Where I do see a problem here is in the City need to be able to rely upon its consultant to provide an accurate foundation of information that ultimately flows to use in the budgeting choices it must make. The City paid Midwestern for this. The "cost" to Saline of getting this wrong is the need to now "find" that money in some other budget item not yet spent. That's a sudden, new problem. It also means that some other budget commitment or commitments will now need to be revisited. I'd like to see Midwestern answer this important concern.

By the way: Kudos to taxpayer advocate Mary Hess for catching this and calling it to the attention of City Council last night. And thank you to City Council for immediately responding to her "citizen comment" real-time.

Bonnie's picture

 Mary Hess you are one smart cookie to keep this Council honest!  

Just for the records when Mary was on Council she was the only one that went through the bills!  She did not believe in paying for alcohol for any meeting dinner and many other extras.  

Bonnie's picture

Maybe Gary Roubal would like to chalk it up and he pay for it for the exorbitant amount he makes from what we tax payers pay him!  It appears everybody on council just blows off money. When they expanded city hall as Gretchen called. Ha! It appears She must have planted a money tree in the back yard of city hall and passed it on to Brian Marl!  Spend spend spend is all this current and past council does!  Take care of the problem of sewage stench being smelled at the Christmas parade and all over town! 

Mary Hess's picture

Correction  Tran;  It appears parking Lot 4 ran $35,721. UNDER the Adjusted Bid, and the Cemetery Drives ran $50,835 OVER the Adjusted Bid .

Ron Mexico's picture

I understand that mistakes happen. But we are starting to see a clear pattern of multiple issues and oversights under the Campbell regime. At some point, someone needs to be held accountable instead of just insisting raises for city staff not be questioned by city council. Some of the gaffs were not directly caused by city staff but could have likely been avoided by a more competent and diligent team exercising some attention to detail. Regardless of direct culpability for individual instances, when there is a clear pattern of failure, the person at the top needs to take responsibility.

Mary Hess's picture

It appears someone need to be addressed for these large mistakes.