Communication has been both the bane and blessing of Fayetteville's Wastewater System Improvement Project, says Mayor Dan Coody.
The citywide project is central to the campaign for the 1 cent sales tax Coody is promoting, which would include paying $ 42 million in costs for the project, which he attributes to causes outside of his control. The sales tax would also pay for $ 65. 9 million in street projects and $ 2. 1 million in trails.
Only the trail project could be funded with the 1 / 4 cent sales tax, with the rest being dependent upon the extension of the 3 / 4 cent tax that was approved in 2001 to fund up to $ 125 million for the project. The cost is now estimated at $ 183 million, with a completion date of 2008, instead of the 2005 completion that was given in 2001.
Just as in 2001, residents are faced with the choice of how much they want their monthly sewer rates to increase. Approval of the tax will keep that increase to about 20 percent, while fail- ure of the measure would mean an increase of around 50 percent.
When the delay in project completion and increased costs were first addressed by the administration in April of last year, the blame was placed squarely on the engineering firm hired as program manager, Burns and McDonnell. While Coody still blames them for not giving him better information during their tenure with the city, he now says the project is right on schedule. The only problem, he said, is that the initial schedule wasn't based on reality.
When signing three requests for extensions of time for fulfilling requirements of the $ 100 million loan from the Arkansas Natural Resources Commission, Coody says he was assured that the construction schedule would not be affected. The city amended its agreement with the commission three times, the last of which placed the completion of the process - which would allow the city to close on the loan - at May 15, 2005.
Coody blames the higher cost on increased material prices caused by hurricanes and the war in Iraq. He says he is proud of the progress made to date and offers as proof that the project is doing well the city's nomination for an Environmental Protection Agency award for the city's communication with Oklahoma.
While the city has been able to communicate with Oklahoma on the project, apparently until recently there has been no communication between the water and sewer director or the consultants on the project.
Review of e-mails between consultants and former sewer director Greg Boettcher indicates that there were discussions over cost increases and time slippage throughout the course of the project. While the thousands of e-mails between consultants, the three sewer directors that have worked on the project since 2001 and the mayor have not been reviewed to a level that would definitively answer all questions about the project, they do show that some players have been aware that the project would take longer and cost much more than what was told to the public for nearly five years.
"No matter what we see in here," Coody said about the e-mails. "Nothing slowed - the project was moving along at a good pace, nothing was stopped, nothing was stalled. The communication was abysmal but the project its self was moving along really well and we've been making a lot of good progress.
"The initial time line was unrealistic, we've all come to realize that now and we all should have spotted that that was the communication breakdown but we are exactly where a project of this magnitude should be in the scheme of things now, I'm sure about that," he continued. "We can't find a point to where the project stopped for six months, eight months ten months anything like that because it was continual work begin done from day one all the way through to today."
On Jan. 14, 2003, Ray Santee of Burns and McDonnell communicated the potential cost increase to Boettcher in an e-mail, in which Santee wrote:
"I have done a preliminary review of the budget with the correct numbers for consultants fees, and a reasonable contingency. The number comes up the same as it did on my first pass last August, right around ($ ) 140 M.
"As we discussed I think it would be a good idea to simply sit down with the consultants and ask how much possible'fat' there is in the construction numbers. I am afraid it will be difficult to get a straight answer since at this point they really don't have much motivation to cut cost. I'll put together a line of questioning I hope can get us the answers we want. Ultimately it will be up to the individual consultants to be forthcoming. I will get that together and have it for you by the end of the week. Thanks."
The final value engineering report on the westside sewer plant, in July 2003, which is the largest and most time-consuming project, gave an estimated construction cost of $ 51 million. When the city went out to bid on the project in July of last year, it certified $ 48 million for the work and had to reject the two bids that came in, which were $ 62 million and $ 71 million.
After hurricanes Katrina and Rita, the negotiated a $ 62 million construction contract for the plant and attributed the damage to the increased cost. The negotiated contract, which required a change in financing, involved removing the construction of Broyles Road and wetland mitigation, which were included in earlier estimates.
In 2001, the plant was estimated at $ 42. 5 million before a design change that resulted in it being reduced to $ 39. 5.
Coody says he was not told of the increased costs and delays until February 2005, immediately after which he drafted a letter to Burns and McDonnell expressing his concerns over the project. The letter, dated Feb. 15, 2005, was sent to Jerry Sonderegger, who served as project manager for the company.
"I am increasingly skeptical that the program is proceeding as has been described," Coody wrote. "Over the past few years I have been informed that the program is on schedule and is moving along according to plan. I have relied on the professional expertise of Burns and Mac to keep everything on track and on target. Since the beginning of this project I have repeated the goals of this administration of keeping this project on time and on budget."
Coody said the city would have tried to get restitution from Burns and McDonnell, but their contract language was written to protect them and "their lawyers are bigger than our lawyers."
A month later, Sonderegger addressed the council and informed aldermen that the plant would not be completed until mid-2007 and discussed increased cost of materials, which was on message with what he and then-sewer director Bob Davis discussed in an e-mail on March 9.
"I assume the thrust would be on budget and schedule and since these two could be volatile, perhaps Matt (Taylor ) and I could visit with you on the phone to establish a company line," Sonderegger wrote, asking about the format for the presentation and whether any other consultants should be in attendance.
"I would say a 25-30 minute presentation will be as long as we can hold their attention," Davis responded. "The only other consultant I would suggest is (McGoodwin, Williams and Yates. ) Since the West Plant is, in my opinion, the potential bad boy of these projects and because MWY has taken (again, in my opinion ) their own sweet time about submitting acceptable plans and specs., it might not hurt to have MWY present.
"As far as company line, the truth works for me. My personal opinion is that we justify, in part, budget problems by talking in specifics about material and fuel cost increases over the last 3 years. This data is fairly easy to dig up, is real, and is something that everybody understands from a personal standpoint. As far as scheduling, it appears to me that ADEQ, the Corp, and ASWCC have provided enough land mines that there might be truth in using the problems we have encountered with them as, again, a partial reason for scheduling problems."
Sonderegger asserted that the company had not done anything wrong when Coody blamed them mismanaging the project in April of last year. The two met with Davis prior to the March 15 presentation to the council to talk about what aldermen would be told.
"(Coody ) has told us what to say, and when I said it, I caught hell," Sonderegger said at the time, a quote Coody says he remembers but doesn't understand.
Coody said he didn't have anything to gain by telling the consultants to keep the project status from the public and wouldn't have even if had had. When asked, he said he did not try to keep the problems quiet to benefit his campaign for re-election in 2004.
Taylor, an employee of Burns and McDonnell, was an engineer on the project and worked out of city hall until Davis was hired to replace Boettcher. When the problems with the project were first made public, Davis was credited with finding them, though more recently Coody has said that Taylor was the one who informed him that the project was off track.
In an exchange between Davis and Taylor over the administrations' discussions about hiring another project management firm, Taylor expressed his confusion about the situation.
"I suppose their question is what has happened that they / we have suddenly fallen out of favor," Taylor wrote, noting that a month before the April 4, 2005, email, administrators were talking about keeping Burns and McDonnell on for the remaining stages of the project.
"I guess I'm puzzled because David (Jurgens ), Steve (Davis ) and Greg (Boettcher ) all knew the budget and scheduling issues and all chose not to tell the Mayor," Taylor continued. "When I told them I wanted to tell the mayor they each told me'no'or wait a few more weeks. It seems the real issue is what Greg did or didn't do, but it's somehow falling down on B & M."
Taylor went on to offer Davis some cautionary advice.
"I was completely honest with the mayor as soon as I was sure about things and it didn't seem to make much difference," Taylor wrote. "Maybe you can walk that line better, but they are on their third City Engineer in 2 years and their third (public works ) director in 3 years."
Coody said he didn't put much credence in "cherry picking"e-mails and is adamant that the project has not been mismanaged. He said that in an effort to be open with the public, his administration has provided information as it obtained it. As more information has been found, the description of what happened has evolved, he said, and it appears that the project is where it should be.
Boettcher, who now serves as director of the Polk County, Fla., utilities department, could not be reached in time for this article.
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