MDOT's Credibility: On The Line Again - Part 2
by Keith Burton - GCN Special Report - Filed 12/16/05
In an earlier GCN report, we told you about MDOT's plan to use the Design-Build method of construction for the Biloxi-Ocean Springs and Bay St. Louis bridges. These two bridges were severely damaged by Hurricane Katrina and with their locations at opposite ends of Harrison County, form a critical roadway needed for the Coast to recover.
In GCN's previous report, we noted that state law currently only allows one Design-Build project per year if the projects are over $50-million. The two bridges are estimated at around $200-million each. MDOT's Southern District Highway Commissioner Wayne Brown believes the Design-Build method will shave some time of the construction of these vital bridges even though it will come at the cost of some oversight by the agency. Brown spoke with GCN late Friday afternoon about the bridges and more.
Brown confirmed that the Design-Build method does restrict the number of such projects that can be built in one year, however, his agency did obtain an Attorney General's Opinion that provided a way to add a project. GCN has obtained a copy of the AG's Opinion. The opinion says in summary that as the state is in a "State of Emergency" from Hurricane Katrina, and as emergency measures are in place, MDOT would be allowed to use the Design-Method for such projects and the one project restriction does not apply.
While the state law is very clear on the limitations of the Design-Build method, the AG's Opinion does not cite a specific statute that allows for more than one Design-Build project, only that Design-Build projects are authorized. While it is good that MDOT does have the AG's Opinion, the sheer fact that an opinion on the law was requested indicates that there is some concern here. MDOT requested the AG's Opinion in September, and it has only recently been mentioned as a result of GCN's inquiries on this issue.
MDOT's plan to use the Design-Build method of construction is a first for the state. The Design-Build method means that the same company that will be awarded the contracts will be responsible for the demolition, architectural design, engineering and construction of the bridges.
But as of this point, Brown says his agency doesn't have the money to build the bridges and he agency is waiting on Congress to approve Katrina-related recovery funds for highway and bridge repair that would be administered by the Federal Department of Transportation. He is hopeful, as are others, that Congress will appropriate the money prior to Christmas, but if that doesn't happen, it would delay the letting of contracts and construction. Congress is expected to approve some $2-billion for Katrina road and bridge repairs, but as of this update, the measure, which was passed by the U.S. House, still awaits approval in the Senate.
Brown tells GCN that the entire project for both bridges will take a total of 24 months or a bit more to finish after construction begins, but he hopes that two lane traffic would be possible before then. But it is all speculation at this point. Brown says there are many factors that remain that have to be resolved, but he anticipates that the bridges would be ready early in 2008.
The problem with financing doesn't end with the release of federal funds. Brown says that MDOT must use its own money first, and then draw down the repayments from the federal government. What that means is that statewide, MDOT has only a limited amount of cash on hand that it uses first, then accesses the federal money for reimbursement. Brown says that MDOT can borrow on a short term note up to $100-million to help them with bigger projects, but they still have to carefully balance those loans with the federal reimbursement money. Brown says that to get around the money delays, MDOT would make payments on its work in up to $25-million amounts each month. What all this means is that MDOT must carefully balance its own money with the federal monies available, and the timing isn't certain. This has the effect of delaying work, which could add to the problems in getting the bridges finished.
"We never spend federal money," Brown said. "We spend our money, then the federal government reimburses us."
Last August, Mississippi received $2-billion for road construction in the state that is to be spent over the next six years. GCN asked Brown if the state could have just reallocated some of that money for other projects on the emergency work for the bridges in Harrison and Hancock county. Brown said that it is possible, but it is not what the agency felt should be done as the money is allocated for other projects.
"That's project money. We already have those projects let," Brown said.
Brown tells GCN that if the federal money is approved prior to Christmas, then the design-build teams that have been selected by MDOT are to turn in technical proposals on Dec. 30, with price proposals due Jan. 9. The contracts would then be awarded the next day. But if there are any delays with the funding, then the process could be delayed up to two months.
Wayne Brown called GCN a day after our request for an interview. We started the interview regarding the status of the federal help that has been stalled in Congress. The interview includes comments on the City of Biloxi's plan to expand the Popps Ferry Bridge, the work to restore U.S. Highway 90 next year after the temporary repairs are made, and Brown's assessments of the opposition to the Biloxi-Ocean Springs bridge by Ocean Springs.
GCN asked Brown to comment on the recommendations from the Governor's commission on rebuilding the Coast that suggested more bridges would be better than a single large bridge at moving traffic. He said that those studies primarily dealt with moving traffic within Biloxi and that additional bridges would take years of environmental studies and would be costly. As to moving the CSX railroad, which would open a corridor for an additional East-West road, Brown said that CSX is currently spending nearly $300-million to repair their line. But, he says insiders believe that CSX will be moved. He said he believes one reason CSX is repairing their line is to negotiate from a position of strength. In any case, Brown said it would take several years to relocate the line.
Brown said that the Ocean Springs opposition to the new bridge doesn't reflect everyone in that city, noting that in Jackson County, political sides are often very evenly split and he feels that opposition to the new bridge is not the work of a true majority.
The Design-Build legislation was added in 2004 to Section 65-1-85, Mississippi Code of 1972, as amended (Method of awarding contracts). There were some differences in the Senate and House versions. The legislation was sent to a Senate/House conference committee consisting of three senators, including: Senator Billy Hewes, R-Harrison County; Stacey E. Pickering, R-Jones County; and Merle Flowers, R- Desoto County; Representatives: Hank Zuber, R Jackson County; Greg Ward D-Benton, Tippa, Union Counties; William Miles D- Itawamba, Monroe Counties, for reconciliation.
This committee reconciled the Senate and House Bills. The legislation was sent to the Governor and he signed it on 5/13/04. The Design Build legislation is as follows:
Par (11)(a) of the legislation states, “As an alternative to the method of awarding contracts as otherwise provided in this section, the commission may use the Design-build method of contracting for the following:
(i) Projects for the Mississippi Development Authority pursuant to agreements between both governmental entities:
(ii) Any project with an estimated cost of not more than Ten Million Dollars ($10,000,000.00), not to exceed two (2) projects per fiscal year; and
(iii)Any project with an estimated cost of more than Fifty Million Dollars ($50,000,000.00), not to exceed one (1) project per fiscal year.
(b) As used in this subsection, the term “design-build) method of contracting means a contract that combines the design and construction phases of a project into a single contract and the contractor is required to satisfactorily perform, at a minimum, both the design and construction of the project.
(c) The commission shall establish detailed criteria for the selection of the successful design-build contractor in each request for design-build proposals. The evaluation of the selection committee is a public record and shall be maintained for a minimum of ten (10) years after project completion.
(d) The commission shall maintain detailed records on projects separate an apart from its regular record keeping. The commission shall file a report to the Legislature evaluating the design-build method of contracting by comparing it to the low-bid method of contracting. At a minimum, the report must include:
(i) The management goals and objectives for the design-build system of management;
(ii) A complete description of the components of the design-build system, including a description of the system the department put into place on all projects managed under the system to insure that it has the complete information on highway segment costs and to insure proper analysis of any proposal the commission receives from a highway contractor;
(iii) The accountability systems the Transportation Department established to monitor any design-build project’s compliance with specific goals and objectives for the project;
(iv) The outcome of any project or any interim report on an ongoing project let under a design-build management system showing compliance with the goals, objectives, policies and procedures the department set for the project; and
(v) The method used by the department to select projects to be let under the design-build system of management and all other systems, policies and procedures that the department considered as necessary components to a design-build management system.
(vi)All contracts let under the provisions of this subsection shall be subjects to oversight and review by the State Auditor. The State Auditor shall file a report with the Legislature on or before January 1 of each year detailing his findings with regard to any contract let or project performed in violation of the provisions of this subsection….
MDOT originally hoped to accept bids this past week on projects to rebuild the Biloxi Bay and Bay of St. Louis bridges, but Wayne Brown claims that the process has been delayed pending the outcome of a congressional budget stalemate in Washington, which has held up funding. The design-build teams are to turn in technical proposals on Dec. 30, with price proposals due Jan. 9 and the contracts being awarded the next day. However, there are issues that may change those dates. Commissioner Brown has said that he doesn’t know how long it will take for the bridges to be open, but he estimates some limited use by late 2007.
MDOT has selected a short list of builders for the two bridges. The list for the Biloxi-Ocean Springs bridge are:
1. Brian A. Peterson
2. F. Keith Jacobson
3. Brian C. Kaub
The list potential builders selected for the Bay St. Louis bridge are:
1. Alvin S. Flettrich,
2. F. Keith Jacobson
3. Brian C. Kaub