Tag: Augusta Commission

$200 Theater Tickets Trumped a $20 Million Cost Recovery Effort?

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UPDATE: At the August 5, 2014 meeting of the Augusta Commission, the Augusta media got its panties in a wad over $200 James Brown Movie premier tickets and ruffled feathers between Mayor Copenhaver and Commissioner Bill Fennoy.

In any place other than Augusta, a request for the Augusta National Golf Club to pay up $20 million just might have attracted a camera lens.

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Mayor Copenhaver, Gentlemen and Lady of the Commission, today let’s go down the Road of Good Intentions known as TIA 2010. Here is a road sign Commissioners Bowles and Lockett tried to install on this twisted road before we got to this Fiasco Junction.

This program has gone structurally bust in the 13 County CSRA region to the tune of $80 million to $140 million. Revenues are nearly 10% short versus budget. The investment project’s costs are worse – now reported at the $538 million of 2011, but stood at $630 million when TIA passed. Worst of all is that higher number bore increases of 2% per year, but the cost of early projects is increasing more than 5%.

What happens to Augusta and its partner counties when funds run out in year eight? Augusta gets 60% of Phase 1 money, so the other counties could see Augusta’s early projects eat up their funding.

Distrust grows from Augusta swapping projects between Phases. Augusta was permitted to move the two Berckmans Road projects from the last phase to the second phase, but has a side deal with the Augusta National for a loan that moves the main project to Phase 1. The amount funded is just the $16.7 million base cost of that project. When the real costs come in, those projects could cost $2 million more. If the funds are capped at $16.7 million Augusta bears that cost. If the escalated costs are allowed to Augusta, we bear the cost.

The National’s project overruns mean promises to the people get dropped, here and throughout the region. Already $7.5 million for Municipal Transit promised didn’t get a dime in 2013.

The arrangements with Augusta and the Augusta National are of dubious legality. Nothing in TIA 2010 provides for a private entity to interject itself to secure earlier funding. The TIA citizens’ advisory panel we citizens were promised had oversight wasn’t even allowed to vote on the changes.

What of the Berckmans right of way – a TIA allowable cost? The proposed land swap with the National could be a net payment to Augusta that appropriately belongs to the regional fund. How can you separate out the complete costs of those options, like tunnels, the National wants from the TIA portion?

Finally there is the matter of trust. We cannot trust Augusta. The National paid $1.9 million an acre for its last purchase, yet you are giving up 13 acres bordering the course itself with no attempt to get the National to pay – not loan – the $20 million or more their project will cost. Then look at the Highlands Avenue Project, where you are using 90% in other funds over and above TIA to meet the contracted price. All counties were to report all costs, including other sources, but Augusta didn’t. How many other games is Augusta playing with us?

In February reports flew out about the “TIA success” here. The press used a deceptive TIA funding list largely of non-TIA funds. Today, legislators are meeting in Atlanta over transportation thinking this disaster actually works.

Let’s douse that notion by loudly demanding concrete action to secure that state guarantee of funding we heard in the TIA campaign.

For the Augusta National, doing business with the last Augusta administration was high risk. Pay for your project to get free of this embarrassment now.

Basenjis Don’t Roar on Reynolds Street

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Morris Communications has a new online venture it has branded as ROAR.us, but its three year case of lockjaw over the scandal-wracked TEE Center and Parking Decks doesn’t show any sign of soon loosening into ear shattering howls.

Morris wasn’t so quiet in the run up to approval of the $50 million boondoggle. In fact, it published a piece stating that the land its affiliate owned was to be deeded over to the city. It published guest columns from Convention and Bureau Chairman Barry White, saying that the Morris affiliate would donate $1 million of land and cover costs over the $350,000 funded by the hotel/motel tax, and another from the CVB’s Abram Serotta promising that the funding would be covered by the hotel/motel tax.

The noisy cheerleading promising no cost to the taxpayer over the $350,000 motel tax support is one bookend. The other bookend came in late 2012, when the Augusta Commission admitted that the operating costs could drain nearly $900,000 from the property tax supported general fund. The losses narrowed to $535,000 after the books for 2013 were closed, but did not receive rigorous questioning from a pliant Augusta Commission.

Between the bookends came a bribery trial arising from the Convention Center parking deck agreement, revelations that the land promised for donation for the parking deck by the Morris affiliate had $7 million in liens on it, the shocker that Augusta had bought $2 million of kitchen equipment that was the Morris affiliate’s responsibility, the stalemate of the management agreement that provided no accounting control over commingled food and beverages, commingled electrical costs that were supposed to be separately metered, and other snafus got virtually no attention from the Augusta Chronicle. (Dare we now call it the Augusta Scamical?) other than meek postscripts noting that there are “ties” between the Morris affiliate Augusta Riverfront, LLC and the Chronicle.

The Basenji breed of dog is bark-less because its voice box is muted. The Morris’ Augusta Chronicle and sister publications have been reported to be muted by senior management by the best of all sources – their ex-employees.

The attention given to Augusta’s General Fund during the month of August revived attention to the Morris caper and the surprise reversal of assurances that no general funds would be touched by the Convention Center Operations. The public was roaring its anger in the Commission Chamber on August 28, but the sound from Morris Communications sounded more like a basenji’s muffled, whiny grunt from a corner of that empty taxpayer-money-hemorrhaging parking deck on Reynolds Street.

Pro-SPLOST Augusta Commissioner Goes Rogue

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When someone is filled with venomous rage, they tend to not hear what is said. In this case, please watch and listen to the segment of question and answer immediately before Commissioner Donnie Smith’s reprehensible diatribe. Next you get to observe the reaction of Commissioner Bill Lockett, who demonstrated that he was listening to that discourse with keen interest, because he almost perfectly recited it back to Commissioner Smith.

When this effort began 30 months ago, it began 5 years beyond the capability of any hostile party to seek retribution against an employer, client, or reference. Exhaustive case studies are found on both the agraynation.com and costrecoveryworks.com sites. On this site are numerous videos, articles, and publications documenting the achievements of these past 30 months, which have resulted in tremendous savings to Augusta.

– Prevented misapplication of an overlay zoning district to a greater area than was legal.
– Did title search under Reynolds Street Parking Deck using the Georgia Superior Courts Website and the Augusta Clerk of Superior Court Office, found Augusta did not own the land under their facility, found there were $7 million in liens on the land, and then notified the media, commission and the public. Then supported curtailing costs of the management contract.
– Supported the County Commission with efforts to institute last minute controls over the Convention Center project with the result that unlimited catering, audit rights were expanded and other costs were capped.
– Researched Urban Redevelopment Areas and successfully assisted the Augusta Commission in curtailing the Augusta Downtown Redevelopment Area.
– Researched Tax Allocation Districts and advised commissioners that TAD One was $10’s of millions under water.
– Supported a $184,000 reduction in the sales tax management project
– Found a $164,000 overcharge in a subcontract.

Augusta Commission Buries Old Sins with New SPLOST Abomination

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This holey bucket, made up as a prop for one of your SPLOST meetings, is stunningly perfect as a depiction of Augusta’s Sales Tax Program. Properly designed, your liquidity slowly meters out one hole in the bottom, but the way this one is, liquidity spurts out all over the place, leaving the tree to wither. Augusta has been to the well too often with a bucket like this and this might be the final trip before the well is dry.

When you have a $12 million parking deck funded with sales tax built on land you did not own, that is a pretty big hole. When you have $2 million of sales tax funded kitchen equipment you were not supposed to pay for, exchanged for land that was supposed to be donated, that is a doubly big hole. When those sales taxes build a facility that drain the general fund, to the tune of $250,000 a year for 50 years to pay staff that were free under another agreement, that hole becomes a gaping maw. When you use sales tax to fund a municipal building and don’t use the right contracting, $20 million doubles to $40 million, on the way to $65 million. When you don’t recapture what contractors owe you, you lose $750,000 on your sewage contract, close to $150,000 on an office building, and untold $ millions on a convention center. Those are the big holes. The liquidity lost from myriad smaller ones may be greater, because Augusta doesn’t even have a sales tax program control manual built into its sales tax management contract.

The liquidity coming in from SPLOST, shouted to the heavens in timely initiatives designed to promote the SPLOST vote, isn’t there and won’t be there. For instance, past SPLOSTs made streams of interest income that have evaporated and been further diminished by use of high cost or inefficient banks, as Columbia County may be learning.

People get excited about lining up with the holes in your new SPLOST too. The Marriott folks want a $1 million skywalk, we see. Before giving them the money, which a former commission approved, wouldn’t it be prudent to see if there are offsetting charges from Augusta back to the Marriott? The Augusta citizens whom I was helping two years ago looked into several areas potentially offsetting that $1 million but were stonewalled by Fred Russell. Most of those centered on the Conference Center contract that was extended.

The biggest hole of them all is a chasm where truth should be. When the “news media” is so embedded in the subject of a story, as the Chronicle was with the Convention Center management, even their closest allies lose. Poor Rick Allen, the TEE Center contractor, believed what he read in the daily newspaper and became so un-witting that there were any loose ends that he accepted $7,000 in campaign donations from the top Marriott executive.

Augusta has another year to take the time to fix all the holes in SPLOST while the city and the region wrest with the burgeoning TSPLOST debacle which centers on Augusta also.

Take the time. Fix the holes. There are not many whole buckets of money left.

Taking over the Augusta Commission Chamber

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In early 2012, Augusta faced a dilemma. It had constructed a $15 million parking deck that it did not own. Local activists with the Augusta Today Facebook group and CityStink.net had alerted the media when their research of real estate titles at the Clerk of Court’s office showed that the land was not owned by the city.

Cost recovery analyst Al Gray and Brad Owens took over the commission chambers to address the crowd and insist upon rights of audit, in what was seen as a one-sided contract.

Augusta Sales Tax Program Management Contract Extension

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Augusta’s Sales and Use Tax-funded project management firm was up for contract renewal. After behind-the-scenes support of the commissioners, the contractor reduced the contract price by about $184,000.

Dekefeating the Tyranny of Credentials

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The
Aurelius Principle

A Multidisciplinary Approach
Works Wonders

“Let it be your constant method to look into the design
of people’s actions, and see what they would be at, as often as it is
practicable; and to make this custom the more significant, practice it first
upon yourself.”
– Marcus Aurelius

On Tuesday evening, September 17, 2013 Mayor Deke Copenhaver in an Augusta City Commission meeting challenged me to supply my “credentials.”  He cut me off and would not let me respond. Since he asked for it – here goes.

Fact of the matter is I don’t really have any credentials. I have something much more effective and powerful that I call the Aurelius Principle. What the principle stands for is looking at major transactions globally or taking a multidisciplinary approach. Clients get a whole lot of angles on a problem in one pass that just an accountant, lawyer, administrator, engineer, planner, procurement agent, or other professional cannot provide.

The Aurelius Principle works this way: it uses an opponent’s own power, authority, records, and documents against him. If you think about that, it is something that the very best attorneys use. If one does it really well, he might find himself with a new lucrative line of work. For example, the in depth study of the Augusta convention might lead to marketing the same strategies that the management company there used to secure $3 million a year taxpayer subsidy.

The Principle is time-tested and simply does not fail, because it works on all sides of valuable transactions. The technique has been leveraged up to ever higher planes. It worked well enough for me to hardly hit a lick at a snake and retire early. I don’t have a lot of references, but I do have the Mayor’s records. He will find those a lot more convincing than “Credentials”.

Let’s try to weave an aspect of the principle into the question that Deke Copenhaver asked. Marketing personally to Fortune Magazine listed company executives was nearly impossible but then I sent a letter to  them, with a great white shark eating their precious logos in a window envelopes! It worked! CFO’s whom I needed to spent $50,000 on to contact contacted me!

The renegade marketing added to an enquiry list from potential and eventual clients of Cost Recovery Works, Inc., its predecessors, and mine that included these names, which just might be impressive even to the Mayor.

Tenneco

 

Fort Sterling

 

Maryland Cup

 

Procter and Gamble

 

USG

 

Hanes Brands

 

Sara Lee

 

Con Agra

 

National Gypsum

 

Georgia Pacific

 

Lilly Tulip

 

3M

 

Sunbeam

 

McDermott

 

Johnson and Johnson

 

Fulghum Industries

 

Lowes

Medimmune

 

Home Depot

 

Corning

 

Bass Pro

 

CarMike

 

W.R. Grace

 

Eli Lilly

 

Bristol Myers Squibb

 

Intel

 

St Joseph Foods

 

Georgia Iron Works

 

Boise Cascade

 

Stone Container

 

Fort Howard

 

Weyerhauser

 

Willamette

 

Packaging Company of America

 

Temple Inland

 

Fluor

 

 Lenzing Fibers

 

 Kahn’s

 General Electric

 Hillshire Farms

 

 Fort James

 Unilin

Jacobs

 

Fulghum Fibres

 

Donahue

 
 Duke Energy  Sweetheart Products  Hoku Corporation
 BCE Outdoor  Control Plus  Arale Woods LLC

I performed work for 29 of those companies over the years as an employee, contractor, or subcontractor.

Leveraging up the Aurelius Principle in Augusta and Georgia has made for amazing findings and real results, especially during the Augusta Project since 2011.

To sum up, I knew I might be rusty and used Augusta like my very own laboratory to sharpen my skills. Not many rats escaped.

 

–          AG

The author was President of Cost Recovery Works, Inc., a provider of multidisciplinary contract cost avoidance, cost recovery, and public policy services to industry and government. Cost Recovery works is no longer in business, as of December 31, 2020.

Mission “Impossible” In a Slum

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Originally posted September 18, 2013

The Augusta City Commission on Tuesday, September 17, 2013 heard the following raucous presentation, followed by a heated discussion. Full text follows the video.

Mayor Copenhaver and Commissioners:

Thank you for allowing me to speak tonight in opposition to designating the Downtown Business District a SLUM.

When words no longer are required to carry their true meaning and devolve into meaning the opposite, all men and women should shudder, for in that immoral state what is the meaning of right and wrong?

Let’s look to the Department of Community Affairs Guideline on how to do Urban Redevelopment in Georgia. It cautions against this Commission surrendering all of its Redevelopment Powers to an Authority, but this resolution breathes life back into a body possessive of those powers. It says there needs to be public and private input gone missing in these proceedings. It says beware conflicts if you have a DDA. It says the redevelopment district can be a single parcel, not requiring over 1000 of them in 595 acres. It cautions on the use the broadened power of eminent domain and the power to single out individual landowners for reward or punishment. It says the redevelopment plan is easily changed so you can start with a small district to fund the municipal building with tax exempt bonds, then expand it. These DCA guidelines have neither been followed nor met in myriad ways.

When you allow words to lose meaning, you allow debate over their meaning to obscure that which is a real public menace. The people rightfully fear monsters hatched in the dark will go on to feast – on them – in the dark. The DCA guidelines shine light on the process, so why not insist that they be met?

Questions about this resolution are legion. Is it responsible to fund unlimited debt service with SPLOST revenues that have not been approved yet? Won’t the net result force funds from 99.8% of the rest of Richmond County into this district? Can’t a much smaller Opportunity Zone be created? Can you recapture powers of the Urban Redevelopment Agency? What is afoot with using the very different Redevelopment Powers Act in a coterminous TAD that is so secretive?

Pictures are said to be worth a 1000 words and the Mayor will hold me to about 550, so let me conclude with 2 pictures. Here you see me with my most important client, my mother.

She was confronted with a county overlay zone that singled her property out for restrictions that would have gutted the value of her commercial site. One commissioner, 2 planning commissioners and staff said it was a DONE DEAL with one opining that her land should be acquired by the county for a park. She looked to be all alone until other property owners were awakened.

The people of Augusta are in similar peril. Arrogance around property rights exhibits ignorance of how deep and wide the concepts of fairness and “do unto others” hold our world together. Here you see how the Communist Chinese had to yield to it when elderly homeowners refused to surrender to the government.

The ability under Augusta’s charter to pass any outrage at any time with 6 votes coupled with this SLUM resolution would leave them with no hope.

Flush “SLUM” and let’s banish the much over-used word “Impossible” from describing Augusta. Let’s do it now, do it with conviction and do it together.  Nothing is impossible to those who demand honor instead of a SLUM.

Augusta Commission Asked to Chill Out

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by Al M. Gray

Originally posted September 8, 2013

Trane Chiller – 500 Ton Air Conditioning Unit Image included under FAIR USE for purposes of reporting and education to the public.

The Controversial Urban Redevelopment program is on the Augusta Commission Public Services Committee agenda for Monday September 9, 2013, but something else is attention-getting. It was the request to approve the addition of a chiller to the Convention/TEE Center Chiller Plant. This item might not normally draw a commissioner’s attention, since the Marriott is said to be paying for it.

Let’s not beat around the bush. There are some pretty serious questions, old and new, that this request summons forth. We will begin with the new questions and end with the old questions.

Issue One: Cost Responsibility for Additional Chiller Space and Piping

The Commission Committee Coversheet – Chiller contains this statement:

During the design of the TEE Center project, the chiller plant

was designed for future expansion. All piping stub outs and

additional space has been provided to add two additional chillers

and cooling towers.

 

Some of this space and capacity is now proposed for use in service of the Conference Center. However, the Conference Center CORE agreement, which I understand remained in place when the TEE/Convention Center was authorized, seems to place responsibility for Conference Center HVAC Equipment on Marriott owner Augusta Riverfront, LLC. Did Augusta pay for the “additional space” and the piping stub outs under the Convention/TEE Center Contract?  If so, where did the contractual responsibility shift to Augusta?

Issue Two:  Effects of Chiller Deletions on Convention/Tee Center Construction/ Mechanical Contracts

 In the Attachments_for_Central_Chiller_Plant is a letter from Morris Communications Corporate Architect Robert Kuhar dated August 19, 2013 discussing the expansion of the chiller plant. It contains this statement:

… the central plant was a part of the design very early on in the project… however due to budget constraints, it was not fully implemented. Addition space was provided for expansion of the system.

“Not fully implemented,” suggests partial implementation. How much of the design providing additional capacity and expansion to include the Marriott and Conference Center was implemented? Also, since the Convention/TEE Center project was built on a fast track basis on a partially complete design, did all of the non-Augusta Convention/TEE costs get deleted from the contractor’s and mechanical contractor’s scope of work when the earlier design was deleted? This writer has seen large overpayments occur in similar circumstances.

Issue Three:  Chiller Redundancy and Cost Responsibility

Within the attachment to the Chiller Agenda Item, appears this:

A central chiller plant cools the new Convention Center with cooling towers located on the roof. Two chillers provide 400 tons of cooling each. There is a total of 800 tons of cooling available. When fully occupied during the warmest time of the year the current Conference Center requires approximately 400 tons of cooling. There is 100% redundancy provided by the second chiller.

If this redundancy is to cover the Conference Center, shouldn’t that portion of the capital expenditure have been born by the Manager, Augusta Riverfront, LLC, if the existing Conference Center Agreement still governed?

Issue Four:  Convention versus Marriott and Conference Center Separate Metering Status

In the supporting memo from Robert Kuhar, Corporate Architect of Morris Communications, dated August 19, 2013 and with the subject line, “Centralized Cooling Concept” there is this:

…the Marriott and Conference Center could be metered by either flow meters or BTU meters to determine cost of operation between the different facilities.

 

This brings an old matter back up. You might recall that when Augusta citizen activist Lori Davis requested to see the electrical single line diagrams that will show how power is being distributed between the Conference Center, the Convention Center and the Marriott, she was rebuffed under the guise of “security.” Wasn’t there supposed to be separate metering of utilities to segregate Convention/Tee Center costs , from Marriott and Conference Center Costs? Where does this stand? Can you, the public, or this writer now see the documents and audit trail for these costs?

Issue Five:   Conference Center and old Radisson Hotel versus the 8 Air Turn Marriott Standard

On August 17, 2012, activist Lori Davis submitted a Georgia Open Records Act Request inquiring into the design of the Heating Ventilation and Air Conditioning systems for the existing Marriott/Conference Center before integration with the Convention/ TEE Center HVAC system. The response she received was a CD with empty file directories. The purpose for the inquiry was to evaluate the $399,000 change order to the smoke handling system, which was supposedly based upon a Marriott requirement for 8 air turns, instead of the 2.5 designed. Since the Conference Center and Marriott hotel date back to 1999 (at that time the first building was a Radisson), we wondered whether those older buildings themselves met the 8 air turn requirement. Our next question, had that one met a negative response, would have been to ask why the new Marriott standard would apply to the TEE/Convention Center HVAC, which doesn’t appear to feed directly into either Marriott hotel, but into the Conference Center. Also, any upgrade of the Conference Center to 8 air turns would have had to receive Augusta’s approval.

A final reason that might have brought responsibility for that $399,000 change order cost into question was that the governing Conference Center CORE agreement says this:

Section 7.2 HVAC O1perations. Insofar as certain of the Improvements of the Parties shall be internally connected through common conidors (sic) and passageways, Developer, in operating the air conditioning and heating system for the Hotels and the Expanded Conference Center, shall operate such systems in a manner which will not unduly drain heat, ventilation or air conditioning from the Improvements of any other Party.

 

Doesn’t this imply that the TEE/Convention HVAC would stand alone, with no requirement to meet the higher Marriott standard of 8 air turns? Was the $399,000 change order a necessary Augusta cost, given the authoritative documents? The Augusta Commission settled the construction contract issue by approving the change order, but did that settle the issue between the partners?

 

Issue 6: Morris Communications Employee Involvement

 

Is the involvement of a Morris Communications Executive indicative that Morris employees are the members of Convention/ TEE management firm Augusta Convention Center Management, LLC? What role does the corporate architect play in the management of these facilities?

 

Update: The Public Service Committee of the Augusta Commission voted to approve the installation of the additional chillers and related piping in its September 9, 2013 meeting. In the meeting, Paul Simon of the Augusta Marriott asserted that there is separate metering of utilities between that which Augusta pays and that which the Augusta Marriott and manager Augusta Riverfront, LLC absorbs.

Augusta’s administration continues to hold the as-built drawings that would confirm the existence and contractual correctness of the separate metering. A review of the HVAC design must be the subject of a follow-up Georgia Open Records Act request to answer the questions as to whether the HVAC system design for the Convention/TEE Center followed contractual divisions of responsibility between the Manager and the Owner, the City of Augusta.

-AG

Video: Augusta Commission Committee Discusses Heery/Dukes Contract

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Tuesday, June 11, 2013
Augusta, GA
From CityStink.net Reports

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. Cost Recovery Works is no longer in business, as of December 31, 2020.

An Augusta Commission committee gave no recommendation to proceed with the multi-million dollar contract with Heery International yesterday, deadlocking at 2 to 1. Marion Williams and Wayne Guilfoyle voted not to proceed with extending the contract as-is. Grady Smith and Corey Johnson voted in favor of extending the contract as-is. CityStink.net was there yesterday and got exclusive video of the meeting including where Cost Recovery Specialist Al Gray challenged Heery officials. You can watch that video below.

You can also see our most current investigative piece concerning the Heery saga: