Originally posted on CityStink
June 9, 2013
by Lori Tabb Davis
Contributions were made to this article by Al M. Gray, President of Cost Recovery Works, Inc., a provider of Cost Avoidance and Cost Recovery for America’s leading companies, businesses and governments desiring Superior Returns.
The entire hullabaloo over extension of Augusta’s Project Management contract with Heery International involving community liason Butch Gallop, campaign contributions, gifts to county commissioners, and other hysteria, brings one repetitive thought. Where is the oversight over the Heery overseers?
Can I say totally absent? For certain it is stunningly absent. For now, I brand it Heeryly absent.
When our Augusta Today and Citystink.net team of contributors submitted Georgia Open Records Act requests regarding the Heery contract itself and various contract documents from projects that Heery is and was being paid to manage, control, and supervise for the City of Augusta, we found absurd contradictions with Heery’s role as overseer.
When we looked in the contract and elsewhere for the project procedures manual governing Heery’s performance of the work, we learned that Augusta had none. Our sources told us that an early effort to adopt one was squelched.
Because there was no project procedure manual, perhaps that was the reason that there was no job progress photography protocol to provide us with date-stamped color photos, accompanied by delivery and storage details, of the infamous Tee Center Kitchen Equipment, only black and white pictures of boxes in an unidentified, undisclosed location.
Because there was a lack of coordination of design documents for the Tee Center and already-operating Conference Center, perhaps that is why my open records request for the design of the HVAC for the Tee Center and Conference Center dating back to the days when the Marriott was a Radisson was met with a data disk with blank directories from the city. I fault Augusta for that, but if Heery is Augusta’s Program Manager, shouldn’t they make sure old and new documents are better coordinated?
Because it looks like general contract limits on change orders do not appear to carry through to subcontracts, eye-popping amounts of Augusta’s funds could be in jeopardy.
Heery, if I understand correctly, was paid rates up to and exceeding $200 per hour to provide such services!
The new estimated costs Heery wants to extract from Augusta has been presented at an increase of $1.6 million, including a $149,000 increase/ overrun for the Tee Center, a project that was a total disaster from A to Z.
If Heery is kept, at least $350,000 needs to be cut from that 1.6 million dollar number! I think if all aspects of it were examined, the number that could be cut would be triple that.
How about oversight allowed to Augusta to oversee the overseer Heery by their contract? That was Heeryly absent, too.
The contract cost was put on auto-pilot with 4% annual rate escalation built into the original 2004 Contract. This continued until 2011, when Heery billed slightly lower rates and continued to do so into 2013. The 4% escalation remains, with a consumer Price Index adjustment. With inflation likely to pick up, who knows what the rates will be with compounding like Augusta has seen.
The 2004 contract allows confirmation of the direct cost classification of Heery’s employees without providing what the billing classifications are in terms of employee education, qualifications, certifications, and experience. It sure looks like the program manager Heery has wide latitude to assign people to this contract without Augusta really having the criteria set for their billing rates! (Does Butch Gallop ring a bell? What is a community liason anyhow?)
The contract does not provide for proof of the direct costs of Dukes, Edward, Dukes or Gallop and Associates, who are not Heery employees, but Heery “sub consultants”. What are they?
Access is restricted to “accounting records”, when it is probably the Heery personnel files that would best be used to verify billing classifications.
There is a statement – “Owner may only audit accounting records applicable to a cost reimbursable compensation” This sure sounds like the negotiated rates are sacred and cannot be analyzed by Augusta. Such limitations must go. When paying millions of dollars for professional services, shouldn’t Augusta be able to audit anything that touches on what the city is getting?
Our team’s investigative efforts have born amazing results for Augusta and it is a shame to see them stymied by restrictions on audit rights. We saw that the Messerly waste water contract with ESG mandates that Georgia Open Records access be extended to every significant subcontractor. Subcontracts and major supply orders under Heery-managed general contracts need to be brought in line with that standard too. We cannot help if we are stonewalled by contractors and the administration.
After the numerous controversies and fiasco’s involving Augusta projects, Butch Gallop and Associates, the Tee Center, and Tee Center parking decks, it is clear – the overseer needs oversight and the Augusta administrator, starting with George Kolb and continuing under Fred Russell, has not provided it, he has avoided it. Heery, understandably aiming to please the client, looks like it became a rubber stamp.
If the Augusta Commission extends this contract, citizens should expect better controls, refunds of any miscalculated rate overcharges (if any exist), and lowering of rates to reflect known factors favorable to Augusta. Augusta needs to ditch Butch Gallop now, too.
Our Augusta reformers love old movies and I used to get all into being Lois Lane. Here is a segment that came to mind as I pondered all of this.
“You…you’ve got me, who’s got you?”
Harrisburg in Augusta is in free fall. Deke Copenhaver might be an Ironman, but he is no man of steel. Heery has him, but who has Heery? Looks to me nothing but hot, stagnant city air.
Somehow I think both would just as soon see me, go splat. Augusta too, if there is a dime involved for them to get.