Tag: Commentary

Intimidation in Evans?

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During the recent look at Columbia County Georgia’s controversial 2010 Banking Services Request For Proposal, which was awarded to Georgia Bank and Trust, a bank in which two county commissioners held stock and a third is now President of the bank, Ms. Leanne Reece was seen at the County Commission meeting accompanied by a young lad taken to be her son. You can see the boy in this video.

His presence was enough to change the topic of the presentation that night from Banking Services to the TIA 2010 scandal, because there was no desire to pressure his mom in front of him.

It is a shame the county commissioners aren’t so forgiving when it comes to applying pressure to county employees to get an intended outcome.

The banking RFP seems to have gone through the entire process up to a week or so prior to the meeting as Bid Title: Banking Services for Columbia County, GA Board of Commissioners Bid Number: 2010-005 but was on the Agenda April 20, 2010, the fateful night that the commission awarded the contract, as RFP 2010-005 Banking Services for the County and Water Utility.

Why is the title change potentially significant? Based upon the submissions by responding banks, the evaluation team only recommended Georgia Bank and Trust for the Water Utility accounts, county accounts the bank already had. Finance Director Reece was one of the evaluators and had even noted that the apparently winning bank based upon the evaluation, First Citizens Bank, had offered a 1% interest rate minimum. She wrote there was “no floor” in the GB&T proposal, an odd statement since GB&T is shown to have offered a floor of 0.75%. Can it be that was true with the original submittals, since replaced by altered documents? With this gang of manipulators, who knows?

If she was that attuned to the greater interest earnings potential of First Citizens, why would Director Reece go along with the lesser proposal based upon a speculative analysis from county bond underwriter Jeffries?

This entire affair reeks of pressure put on a professional woman with a family by powerful men with control over her job.

You have to hope that job isn’t in jeopardy for yielding to human fear.

Government Watchdogs Help Save Richmond County Taxpayers $6 Million

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Originally posted by CityStink
November 13, 2012
Augusta, GA
By Al Gray

The author, Al M. Gray, was 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.

It began calmly enough for this correspondent in August 2011. Another chapter in life had been closed with the disposition of all commercial property in Evans, which was our family’s investment of a lifetime.  That adventure of maximizing returns from that investment had required leveraging up multidisciplinary contract and regulatory review skills to a new level in combating hostile forces inside of Columbia County government. The comfort of total retirement beckoned until zero-interest-rate-policies of the Federal Reserve attacked all safe income streams. Thoughts crept in about leveraging up the entire old repertoire of skills on a grander scale, but how?

Along came Deke Copenhaver’s ill-fated attempt to get a downtown stadium for a group headed by former Baltimore baseball great Cal Ripken, Jr.  The whole deal looked suspect all the way from the woods of Lincoln County and a tiny band of opponents rose up to combat the project. This just happened to coincide with a preliminary secretive review of Augusta’s major contracts for the water treatment plant, sales tax project oversight, and the TEE Center construction. The activists had a meeting that I drove down to attend. We quickly found and developed common bonds.

Our first success came a year ago this month, with our opposition to the Laney Walker Bethlehem Overlay District (LWBOLD). We successfully got the Augusta Commission’s motion to approve scaled back to the correct, much more compact Foundry Node, rather than the huge overall LWBOLD. This early project coincided with the creation of the CityStink.net blog (the name being a parody of Sylvia Cooper’s City Ink column in The Augusta Chronicle)  and a social media group called Augusta Today, a parody of the name Augusta Tomorrow — the latter being a group of elite self-appointed downtown power-brokers who are responsible for many of the ill-conceived taxpayer funded boondoggles over the past 30 years in Augusta.

A large element of success was a core group comprised of Augusta political ‘gadflies’ at whom the Augusta Chronicle was prone to scoff, researchers, and amateur media types. This group collaborated in a number of issues including overlay zoning, Magnolia Trace, the parking deck controversy in which we broke the story about the undisclosed liens, Laney Walker housing, TSPLOST, the 12thDistrict Congressional election, various Augusta contracts, the DDA, the clock and finally the TEE Center.

Former Mayoral candidate Lori Davis emerged quickly to take the lead in arranging for Georgia Open Records Act Requests and turning the results into hard-hitting reports that were promptly delivered. Kurt Huttar and Tom West are fantastic data hounds and analysts whose work would make all manner of Augusta players wet their pants if the research were released. Dee Mathis was an early core group member who took Laney Walker to heart with a rousing defense of property rights. Andy Cheek is an experienced Augusta political hand from his days on the Augusta Commission. Brad Owens is a now successful security contractor, in addition to his familiarity with the minefield of Augusta politics. All have made their presence known in Augusta.

Potential and real savings for Augusta were identified along the way including a possible $300,000 or so on Laney Walker housing, an apparent $167,000 overcharge on a major contract, perhaps $750,000 over the life of parking deck contracts, and now more than $6 million on the TEE Center Contracts, according to Commissioner Corey Johnson and various news reports in the aftermath of last Thursday’s vote to approve considerably-amended Tee Center agreements after Augusta Today founder Brad Owens and this writer met with city and manager attorneys, and three Augusta Commissioners. Johnson put the savings as high as $500,000 a year and our analysis confirms that the savings could easily exceed $400,000 a year between the contract changes and the safeguards to come in the Annual Plan process.

Media reports can be found at Georgia Public Broadcasting’s site which had this to say: “The revised deal cuts the operating losses in half from about $900,000 originally, and it gives Augusta officials the option of renegotiating with the management company after five years.” George Eskola, of WJBF NewsChannel 6 offered the headline “Proposed TEE Center Contract Change Could Save Augusta $500,000.” His report appears below.

Augusta has never seen anything quite like this grass-roots citizens movement made possible by the use of digital media. The response has been overwhelming. Our media vehicles of social media groups and CityStink.net have gained a following among the legal, accounting, public policy, and business communities.

The achievements are not bad, not bad at all, for an operation held together by not much more than duct tape, baling wire, and twine.

Augusta Administrator Fred Russell has characterized Augusta Today as a group that is permanently discontented with the TEE Center contracts, saying “We have listened to everything they have said to do and done it, and now they’re not happy.”  Seven of ten commissioners listened better, delaying approval, and securing $400,000 to $500,000 in annual savings.

Augusta Today is happy today, Fred.

In closing, the phrase from District One Commissioner Matt Aitken, “It is time to move Augusta forward,” suits best. Let’s do that, keeping in mind that approaching problems from all angles makes for the best path forward, one less filled with mistakes. Deke’s and Fred’s way are no longer the only options on the table, when Augusta can save money doing otherwise.

On a more personal note in closing this first annual report card, leveraging up what worked so well before in the corporate and real estate into the glaring lights of Public Policy has been very satisfying. Thanks to each and all who have offered kind words of praise and support.  Thanks even more to the Augusta Today group for their commitment for positive change in government and saving the people’s money.

Who knows where this might end. Maybe what starts in Augusta won’t end in Augusta.***

AG

Enslaved Forever on the TEE Plantation

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Monday, November 12, 2012
Augusta, GA
By The Outsider

Al M. Gray, President of Cost Recovery Works, Inc. contributed multidisciplinary review techniques in support of this article. Cost Recovery Works is no longer in business, as of December 31, 2020.

Now all Augustans lie prostrate to Massa Billy and Massa Paul, thanks to the 6-3 vote of the Augusta Commission to pass the TEE Center deal last Thursday, November 8, 2012. White, black, Mexican, Korean, Chinese or Indian, the entire City of Augusta is now enslaved to Billy Morris and Paul Simon or, if you believe Augusta radio talker Austin Rhodes at WGAC, the Morris children.

No one can really tell who the owners of the new TEE Center management company are because it didn’t even exist until last month and it was registered by an intermediary to keep the ownership hidden, something Augusta’s procurement policies seem to prohibit. It will just have to suffice that the person’s listed on various documents for the original Morris/Simon LLC suggest that the Morris family are the principal owners. Even the Augusta Chronicle, who has acted throughout the TEE escapades as a front for these shadowy LLC’s, has been forced to weakly acknowledge that there are ties with Morris Communications.

The place where they put the permanent shackles on the people was originally supposed to be Augusta’s wonderful new TEE Center, but the massas had confiscated the building before the last concrete set up. They weren’t content to just stick spurs in horses over there in their Hippodrome in Aiken County, now the children all across Richmond County find themselves bound to a plantation and they didn’t have to move to Morris’ Creek Plantation, Wade Plantation, Butterfield Plantation or Millhaven Plantation to do it.

When you are in Augusta, you don’t move to the plantation, the plantation comes to you. Worse of all, the legalese says you and your descendants are slaves to the Morris massa’s TEE House FOREVER!!!

Yes. You read that right.

Mayor Deke Copenhaver and Administrator Fred Russell cheered as Commissioner Corey Johnson, Commissioner Matt Aitken and four other commissioners voted for this:

“Term of this Agreement” shall mean the period of time commencing on the date of this Agreement and continuing in perpetuity for so long as the TEE Center is in existence and shall include the period of time following any casualty with respect to the TEE Center for so long as City has the right to rebuild the TEE Center.

Now reader, you are just about to read the last part of that and tell me it is a way out of the Tee Center for Augusta because it ends when the TEE no longer exists.  Well, it is like the old tale of Dem Bones – “Toe bone connected to the foot bone: Foot bone connected to the leg bone: Leg bone connected to the knee bone…..” You just have to make the connections to get the whole body of facts.
Reading on:

During the Term of this Agreement (perpetuity), City shall, at its sole cost and expense, maintain the TEE Center to the Standard for so long as the TEE Center shall exist.

Getting a better picture now, reader? The “Standard” is whatever Billy and Paul’s interpretation of what their Marriott Hotel says it is and Augusta has to pay whatever it takes to meet their ‘Standard.’ That sounds expensive already, doesn’t it?

Now you Doubting Thomases who are left thinking that this pay-out to Morris and Simon isn’t FOREVER, get with the program. “The knee bone is connected to the thigh bone, and the thigh bone is connected to the hip bone.” And so it goes with the Tee Center. You follow the boneyard and find out it is the TEE Center. Now a Doubting Thomas would say “Well, if Augusta decides to contract with someone else or close down the Tee Center, we can stop paying them or stop paying costs on their behalf, right?”

This isn’t exactly true, according to the contract:

The parties acknowledge that Developer has an important interest in insuring that the TEE Center is maintained in accordance with the Standard, whether or not Developer serves as the Manager or Caterer. Accordingly, this Agreement, and particularly this section of this Agreement, may be enforced by Developer. (Developer is the Morris/Simon.)

In other words the Morris/Simon massa still has the power over the taxpayer, even if their contract is lifted.

Are you getting a queasy feeling in your stomach, Hephzibah? So you on Warren Road think that the TEE plantation you are on will meet an emancipation proclamation that sets you and all your descendants free from PERPETUAL bondage? Dear readers might still not be convinced that the TEE Center is their massa FOREVER. It’s time to read some more:

During the Term of this Agreement (PERPETUITY, remember?), City shall, at its sole cost and expense, procure and keep in effect fire and extended coverage for the TEE Center and all personal property located thereon, including rent loss or business interruption …, in amounts at no time less than the total replacement cost therefor. Such policy referred to above shall name City and Developer as loss payee and additional insureds, as their interest may appear.

So, there you have it. Augusta has to pay for the TEE Plantation in PERPETUITY and pay to insure that it is replaced in PERPETUITY. If it is destroyed, the Morris/Simon hotels are almost certain to be destroyed too, so replacement would be driven more by the Morris/Simon decision on what to do with their hotel complex than anything Augusta decides.

How great is the claim on Augusta’s tax system to pay for the TEE Plantation? On the financing side, the project was built using general obligation sales tax bonds, as certifications by the Construction Manager, R.W. Allen attest. General obligation bonds are backed by the fullest ability of Augusta to tax people out of their homes and businesses out into the street. On the operations side of the TEE Plantation, hoteliers get looted for the first $250,000 (another $100,000 goes into capital spending), but then the rest of the TEE Center losses come out of the General Fund, which also is fed by the power to tax folks into poverty. When a contract like the TEE contract gets executed, that obligation comes before paying for essential city services, like fire and police protection.

Now that the whole skeleton of bones has been assembled, the full picture of the TEE Center deal is this – All of the people of Augusta-Richmond County, their children, and descendants are now under double general obligations to the extent of the value of all of their property to the Morris children and descendants in PERPETUITY.

Get used to the shackles and chains that Mayor Deke put you into.  Only death or getting out of Augusta will give relief.

Can you say that you’ve been TEE-totally subjugated?

It sure looks this way to an Outsider.***
OS

11th Hour for the 12th District

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GOP About to be Reformed, One Way or Another

Originally posted by CityStink
Tuesday, August 21, 2012
Augusta, GA
By Al Gray

The author, Al M. Gray was 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.

A perfect storm has struck the ossified, corrupt political power structure in Augusta, the CSRA, and Georgia. The first harbinger of the maelstrom emerged a year ago when Augusta Mayor Deke Copenhaver attempted to bring a publicly funded baseball stadium to the Riverfront, prompting the formation of a loose coalition of Augustans, area residents, and former citizens. This is Augusta Today.

The opening pitch for that stadium by Mayor Deke was in the dirt.

Then came the Laney Walker Overlay debacle, where the Mayor was eager to run all over city ordinances and the constitutional property rights of the poorest people to get on the cover of Southern Living.

After that has been a blizzard of revelations, sourced in the city’s own documents, that shows a pattern of deception, mismanagement, incompetence, and probably rampant fraud centered in Augusta’s contracts.

Then along came TSPLOST, supposedly a regional collaboration, which instead has blown the CSRA apart and separated it from the 75% of the state that rejected the tax.

Augusta is a renegade government that endangers its citizens. In the parlance of former Defense Secretary Rumsfeld, this is a known known. Things will never be the same again in Augusta and beyond.

The Republican Party in the 12th Congressional District of Georgia is in the midst of reform, too.

This spring the Liberty Movement seized control of the Richmond County GOP convention. They nearly did it at the district convention.

The Columbia County GOP is in pure turmoil from years of shenanigans, deposed chairmen, party establishment ruin, and is totally irrelevant.

A core cadre of GOP legislators named Barbara Sims, Ben Harbin, Lee Anderson, Bill Jackson, and Tom McCall joined together behind beleaguered Nathan Deal to foist TSPLOST, the largest tax increase in Georgia history, on the voters.  The GOP havens Columbia County and Lincoln County rejected them and it.

This same cadre of GOP legislators is wrapped all up in the ASU name change to GRU fiasco. Deal’s Board of Regents Chairman Ben Tarbutton has contributed to Lee Anderson’s congressional campaign and Sims has been supportive of the detested Georgia Regents University name.

John Barrow, the last blue dog Democrat in the South, looms with a war chest that will probably exceed $2 million. Barrow has shown a streak of independence from the Obama Administration and his voting record in terms of fiscal conservatism is on a par with GOP Vice Presidential candidate Paul Ryan. His office has rock solid constituent service.

Reform is about to be visited upon the GOP.  The party establishment hates it, but now knows it stands before an avalanche of public revulsion, anger, and determination. TSPLOST is about to be stopped cold. CSRA politicos will find themselves in a totally untenable position if they don’t reverse course and join this action.

With respect to the 12th District race, the path to reform is either going to be aboard a bullet train or it is going to occur on an even greater scale over 2 years. The former will come with a Rick Allen victory. The later will come with a Lee Anderson victory.

Some might see Allen’s alliances with the mavens of Morris Communications, the Augusta blueblood elites, the Copenhaver-Russell administration, and his own ties to the party establishment all the way to Washington, DC as diametrically opposed to reform. It won’t work that way. Precisely because of those alliances and the many contracts that his business has had with government, Rick Allen will have absolutely no choice but to embrace openness and reform. There simply will be no way to dodge questions. Instead of reform activists having to laboriously go through open records requests, questions will have to be quickly answered and issues resolved. The key to taking Augusta from worst to first lies in its contracting. Rick Allen knows this. Rick Allen will bring the reformers to the table because John Barrow will force him to.

Beyond the things that will force the issue, there is the knowledge that Rick Allen has the intelligence, openness, curiosity, financial background and moral code to bring back the rule of law, the Constitution, and fiscal responsibility to government. He knows the score with far better acumen than most. He knows that the people who send him to Washington won’t be those connected folks.

It was said that only Nixon could have gone to China. Maybe only Allen can visit reform on Augusta.

Reform will come in slower, broader, plainer, and yet more spectacular style if Lee Anderson is the GOP nominee. Then the party will be pinned hopelessly to a candidate with a record hostile to the hurting, threatened, middle class. Barrow will pounce all over it. Anderson went along to get along in the most unethical state government in America. He has pushed sales taxes on groceries, both with the ridiculous GREAT “tax reform” of the disgraced Georgia Speaker Glenn Richardson and with TSPLOST. Anderson’s TSPLOST did away with home rule, subverting Columbia Countians votes to those of welfare statists in neighboring Augusta. His subservience to Nathan Deal brings its own baggage. Then, there is the matter of his willingness to read and comprehend legislation. It just isn’t there. Neither is there substantial debating skill.

Lee is relying on four things to sweep him into office after Tuesday, while he disappears into a cocoon of silence.

  1. One is Obamaphobia.
  2. Two is the promise of $950,000 of Republican Congressional Campaign Committee funds to unseat John Barrow.
  3. Three is that voters uninformed of his record are drawn to vote for “the nice man with the tractor.”
  4. Four is that folks don’t notice that the discredited Georgia establishment is behind him.

It might happen. Obamaphobia very well may mean an Anderson seat in Congress. That would be the sum of all fears for the GOP. It would mean that the party openly supported a known-to-be flawed candidate into the US House of Representatives, one who might deliver more embarrassment and bad policy than a John Deere tractor can haul.

Reform now, GOP. You can pay a nominal price now or a capitol one later.

Tractor pulls are dangerous.***
Al Gray

Peas Lost to TSPLOST (video)

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Originally posted on CityStink
Monday, July 30, 2012
Augusta, GA
By Al Gray

The author, Al M. Gray, was 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.

In his latest anti-TSPLOST video, Al Gray, explains how our buying power will be pea’d away if TSPLOST passes. Watch his video below.

Al Gray: Vote NO to TSPLOST (Video)

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Originally posted on CityStink
Thursday, July 19, 2012
Augusta, GA
From CityStink.net Reports

In his latest video, Al Gray, of ArrowFlinger Reports and a CityStink.net contributor, explains why it is so important for Georgia voters to defeat TSPLOST on the July 31st General Primary ballot.

The author, Al M. Gray was 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.

Al Gray Explains Why TSPLOST Must Be Defeated (Video)

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Originally posted on CityStink
Thursday, July 12, 2012
Lincolnton, GA
From CityStink.net Reports
Commentary

The author, Al M. Gray, was 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.

Al Gray, of ArrowFlinger Reports and a CityStink.net contributor, explains in this video presentation why the atrocity known as TSPLOST should be defeated at the polls on July 31st. Before voting on TSPLOST you NEED to watch this video.

Behind Closed Doors, An Attitude Adjustment

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A Frank Audit

Tuesday, June 26, 2012

Augusta, GA

By Al Gray

Auditors have hang ups. Everything has to go through several drafts so one does not ruffle feathers or bruise egos. After an audit report is finally issued, the horse has escaped the barn. By the time a response is expected, the horse has gotten hungry and come back or he has wandered into a glue factory.

When the universe of the audit is a major capital spending project involving major construction, decision making hasn’t the luxury of 30 or 60 day response times. Delaying a week can have six figure consequences.

In 1983 we were constructing a soap plant addition in Augusta. Our writer was the project auditor. In conjunction with project management a very simple, audit reporting form was developed and implemented for specific transactions. Everyone on the construction team was expected to answer within 5 days, pledging action in most instances. Bigger reviews went through a more formal process, but foot dragging was not allowed there, either.

The process worked so well, that it was taken down the road to the mega $1 billion tissue mill that Fort Howard Corporation decided to plop down in a swampy tract in Effingham County. Trouble reared its head, because the nucleus of the management team had just finished a paper machine addition at Muskogee, Oklahoma. They had gotten into some habits that didn’t include pushy auditors, much less one with a whole staff.

Begrudgingly they all came around.

There was one holdout – Frank Buck, the construction manager. Frank was a big boned former carpenter who had worked his way up to a lofty position from getting results. Frank balked at responding to the few reports that came his way. He even balled one up and threw it at this auditor, snarling “I don’t DO paperwork!” Eventually Frank came around a little.

It was just a little, though. Frank’s favorite description of an auditor was, “One who comes in after the battle is over and bayonets the wounded.”

One day in the later years of the project, some dust got under my contact lens inside the office building. I ran into the men’s room to a mirror over a lavatory to pop the burning contact out and wash it. Having accomplished that, I turned to leave.

I had not noticed, but the far stall door was closed. When I turned to leave, this sort of small, embarrassed voice said “Al Gray, is that you?”

It was Frank.

Turning to face the stall door, I responded, “Yes, Frank it’s me.”

He said “Can you believe I walked in here and sat down and there ain’t one scrap of toilet paper? Can you hand me some?”

“But Frank you don’t DO paperwork!”

That sure was a flimsy door.

Frank’s missing paperwork was my best ever audit report.

Frankly, that was my best audit retort.***

A.G.

Where you gonna say you caught these fish?

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Lies, Damned Lies, Statistics and TSPLOST
Tuesday, June 19, 2012
Augusta, GA
By Al Gray

When Mark Twain described the 3 kinds of lies it was about the art of deception. We find about those too late.

Back in 1990 or so, I was returning to Evans one Friday afternoon after a week on my job down in Effingham County. The evening before I had gone fishing on the lower Savannah River and caught a tremendous number of Bluegills, which were on ice in the back of my truck.

Driving up Millhaven Road approaching Girard, there was a beaver pond on the right close to a high tension power line. As I got closer, I saw the head and shoulders of a man fishing in the pond. Having a busy weekend ahead made for a sudden plan to give away my fish.

I pulled off the road, shut off the engine, and rolled down the window. I said “ Hey…you having any luck?” He said, “Not much, I only catched this lil ole brim,” as he held up a stringer with a fish about the size of 3 fingers. “I don’t believe there are many fish in this hole.” And I asked him, “Would you like a mess of about 35 fish?” He said, “ Sho’ would, I wuz about to give it up, its so hot out heah!” He told me his name was Alonzo and asked if I could give him a ride back to “J-rod.”

After we got to his house and transferred the fish from my cooler to his, he insisted on giving me a few $dollars for the fish and the ride. Just before I pulled away I asked Alonzo, “Where are you gonna tell your buddies you caught these fish?” He laughed and said, “Ah’m gonna tell ’em I catched them in dat beavah pond!”

I forgot about the whole exchange over the weekend, until late Sunday afternoon on the trip back, just south of J-Rod there were a bunch of cars parked on the shoulder. They were alongside that beaver pond, and there was a whole row of folks fishing.

Never believe a politician or a fisherman. They will have you fishing in an empty pond catching only snags and mosquito bites.***

A.G.

Join the Anti-TSPLOST movement on Facebook here–>  Vote NO to TSPLOST

Augusta’s Contract With Heery International Contains More Surprises

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Hear Ye, Heery is Here

More Overpriced Payees for the City?

Originally posted on CityStink
February 24, 2012
Augusta, GA
By Al Gray

The author, Al M. Gray, was 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.

In 2003 the City of Augusta did a wise thing in a very foolish way. The administration saw an enormous upswing in capital spending that it lacked the staff and expertise to plan, engineer, procure, manage and control. A large, growing, and respected Atlanta-based firm, Heery International, was selected to perform these functions. The strategy was sound.

The execution was horrible.

This blanket order was executed with 4% annual rate increases mandated. Despite the downturn in construction and the overall economy, in which labor, overhead and profit have tended to fall, the compounding of Heery’s rates continued unabated. The rates established for next year are up an incredible 48% over the initial rates. A Principle in Charge then was $162.16 an hour, this year one is $230.81 and next year it would be $240.04. A project manager then was $87.32. Now one is $124.28, rising to $129.25 next year. An administrative assistant went from $42.41 to $62.78 an hour.

The cumulative effects are stunning. In July 2010 the contract was extended to 2013. At the time, the contract price was raised from $7,082,355 to $10,317,906.

Amazingly, the total overhead and fee in RW Allen’s contract to build and equip the entire TEE Center is $1.8 million, while Heery’s program management fees will top $1.2 million. There is another $1.3 million slated for the Webster Detention Center Phase II. The Reynolds Street Parking Deck is a surprising $549,390.

A defense can be made that division of duties between the construction management firms and Heery reduced the costs of the former. That is a valid point. The difference in rates probably negates a lot of this advantage, however.

A fairly common approach is for the hourly rate for such services to be based upon some verifiable figure, usually the salary rate of the employee divided by 2080 (52 weeks, 40 hours per week) times a multiplier that is negotiated. 2.0 to 2.3 is a normal range. The Heery contract does not accomplish this. The rates were firmly set on an unknown basis back in 2003 and 2004. Augusta did not negotiate controls over composition of rates.

Beyond this, generally there is a firm division in setting rates that only people directly engaged in the project or on site are billed. Principals, Project Directors, and home office administrative assistants, all of whom appear on Augusta’s contract, are included within the markup applied to the directly-engaged employees. Augusta’s Heery contract allows these employees to be billed in addition to the marked-up billing rates of the direct employees.

Augusta is only permitted to audit the hours billed and the employee classification. Augusta is not allowed access to payroll records to ascertain accuracy of the rate billed or upon what basis the rate is determined. The language is blunt: “OWNER may only audit accounting records applicable to a cost-reimbursable type compensation.”

What this says is that the public can never know how community liaison Butch Gallop‘s Heery billing rate got to be a whopping $177.91 an hour billed, with the potential of being billed at the $240.04 an hour on the rate sheet for next year!

The contract is nearly always advertised as a joint venture between Dukes Edwards Dukes and Heery International. Indeed, Dukes Edwards Dukes principal Winfred Dukes appears on the billing rate sheet at $240.04 an hour in 2013, up from the initial $162.16 an hour. For the sake of clarity and honesty, Dukes bills only about 4 hours a month. He is one of several Heery executives who Augusta should never have allowed to be billed, in this writer’s humble opinion, since they are at supervision levels above the Senior Project Managers and directly-engaged staff on Augusta’s projects.

To summarize, the Heery contract has been on auto-pilot with compounding rates, unverifiable rate bases, and apparent inadequate division of direct labor versus overhead. The fault lies with Augusta, not its contractor, in this case as in all of the others recently reviewed. Augusta is profligate with taxpayer money, in this case by not revisiting a blanket order for services, electing to extend it untouched for years.

Who is Winfred Dukes? Well we found him under the Gold Dome in Atlanta.

Who knew Augusta had another State Representative in the Georgia House?
Mysterious bodies abound in Augusta’s contracts. So far there are two in the Heery contract.

Stay tuned, there is more to come, as the deciphering of Augusta’s contracting continues.
Much more.***

A.G.
Related Stories:
“Galloping” Away With Taxpayers’ Money

**View Heery Document Below

Heery