Sunday, May 15, 2011

Design build vs. Design bid build, how much will the WalMart project cost you?

At the recent financial committee meeting this issue was front and center.  Chairman Brown convened a sub-committee to research several areas of concern regarding a new home for DSS. 1.  Should the County or CRC build the new DSS home?  2.  Should the project be a design build or design bid build, also known as a (municipal build)?  3.  Who can finance the project cheaper, County or CRC?

First. let's discuss the proposed Walmart project and how we got here.  The County realizing their lease on the current home of DSS at 25 railroad ave was coming to an end decided it no longer wanted to stay in it's current location for many reasons, space and financial being the overriding issues.  A search started for a new location, with the BOS, (board of supervisors) tentatively deciding to purchase Ockawamick, an old school building in Clavarack to create a County campus including a new home for DSS.  The old school was purchased for $1.5 million and turned out to be a public opinion disaster, costing several County Supervisors their bid for re-election.  A decision was made that the County would abandon the Ockawamick idea and move on.  Move on is what should be focused on, fellow Supervisors were being told, "we" the County have a clause to extend the lease in the current DSS location if we would like to stay there.  The clause was true, but what the County leadership failed to tell most Supervisors is, if we wanted to extend the lease on the current DSS home at 25 railroad ave. we hand to notify the owner 180 days prior to the lease expiring.  Well, that never happened, so come August, technically the County is out of options to stay at 25 railroad ave, without another location to move to.  The saving grace from what could be a major embarrassment for the County of having it's DSS dept. homeless come August is, the owner of the DSS location is willing to lease the building to the County until the end of the year.  Because of this, there is a mad dash to come up with some kind of solution that would find DSS a new home before the end of the year.  The problem with that is, little planning has been done, little financial study has been done and little communication has been offered to the public.  Ken Flood, Chairman of the CRC offered to take the lead on the WalMart project, but had the rug pulled from under him when he came before the BOS asking for $78,000 to do a space needs assessment regarding County agencies.  This decision put finding a new home for DSS even further behind and sent County leadership scrambling, desperate for an idea that could bail them out of what has been in my opinion a series of missteps made over the past couple of years.

This brings us to the current WalMart idea.  The next time we as Supervisors hear of a new proposed WalMart proposal was when a resolution came before the DPW committee asking for $500,000 to be awarded to an engineer for architecture work on the project.  The resolution was passed and sent to the finance committee for final approval to be sent to the full board for a vote .  At the finance committee it was argued by a couple of Supervisors that it is improper to hand out this kind of money, $500,000 without first putting the contract out for bid.  Commission of DPW, Dave Robinson and Chairman of the Board, Roy Brown argued that this is a professional contract and does not need to be bid out, which is true, but the question is, do we want to spend this kind of taxpayers money without making sure we are getting the best price for the work we need done?  Because of the mad dash to get this project done, Chairman Brown and Commissioner Robinson argued that time is an issue, if we RFP this contract it could take more time than "we" the County have.  This argument went back and forth, with a decision made for an expedited RFP process to be done, the process has not been laid out as of yet!  This brings me to the financial issue being raised.  The sub-committee convened by Chairman Brown has concluded that it would be cheaper for the County to finance the WalMart project rather than having the CRC finance it.  We have been told, if the County were to finance the project it would save up to $2 million dollars over the life of the project because the County can borrow funds at a cheaper rate than the CRC can.

What hasn't been thoroughly researched is, if a design build is cheaper than a design bid build.  At the finance committee meeting, members of the finance committee read some notes from the State Comptroller's office stating that municipalities were using agencies like the CRC to get around tax and labor issues.  This is a difficult issues which the State Legislature and the State Comptroller currently stand at odds over.  Yet, some Supervisors state that a design build is not an option because of the State Comptrollers issue with the program.  This couldn't be further from the truth, the law as written right now, clearly allows municipalities to do design builds through agencies like the CRC.

To this point is where I have a problem with the whole project.  Not that I'm a 100% behind the WalMart idea, a decision I'm convinced will take place whether I support it or not.  My position is, to make sure whatever direction the County goes, we do it in the smartest most economical way possible.  That means giving serious consideration to design build vs. municipal build.  For County leadership to form an opinion on design build without having talked to developers who do construction work for a living is, shall I say, shortsighted!  By declaring "we" the County is going to do the project, YES, takes the option of design build off the table, because it is true, the County itself cannot do a design build, it has to be done by an agency like the CRC or the developer of the building itself. 

County leadership has already stated, by the County financing the project it may save $2 million over the life of the project.  What is not said is, doing a design build may save even more, possibly $3 - $4 million on the project, no one knows because know one has asked.  All I hear is, a design build produces an inferior building, but Saratoga County and Albany County have recently built beautiful buildings using the design build process.

As the general public, you need to pay close attention to this project as it moves forward, you could be paying much more than need be.  Also, ask your Town Supervisor, how much in capital project funding does the County plan to bond for?  My guess would be, in the neighborhood of $25 - $30 million.  Then ask your Supervisor, can we as a County afford such an expense at a time when County unemployment is approaching 10% and 25% of the County is receiving social services?