Carefree used ‘hybrid’ process for Sundial bid
By Linda Bentley | September 23, 2009
CAREFREE – The Sept. 15 council meeting began with a discussion of the town’s bidding procedures for tenant improvements to 8 Sundial Circle.
Town Administrator Gary Neiss opened by saying, “It was a hybrid process that we used.”
Neiss then turned the floor over to Town Attorney Tom Chenal to explain when competitive bidding is not required by statute.
Chenal read A.R.S. 34-201(C), which states, “Any building, structure, addition or alteration may be constructed either with or without the use of the agent’s regularly employed personnel without advertising for bids provided that the total cost of the work … does not exceed … $14,000.” Chenal explained that was the amount for fiscal year 1994-1995, and it is now $19,037, based on the annual percentage change in the GDP price deflator.
Neiss said W. Kirk Hostert of Desert to Mountain Architecture, the architect retained to do the plans, estimated the “millwork” would cost about $18,000. He stated, “We didn’t have to go to a bidding process.”
Hostert said, “My budgetary analysis isn’t even an analysis. I just said I’d be surprised if the whole job even got up to the $18,000 - $19,000 cap number.”
Neiss stated, “We used the town’s advertised bid packet. We were trying to do the right thing.”
Explaining how he and Vice Mayor Glenn Miller contacted eight contractors recommended by the town’s building official, Neiss said, “We told them no bid bond was required and said it would be awarded to the lowest bidder.”
Neiss said, “This was an open and fair process … At 9 a.m. we received three bids.”
Because the bids were all above what the estimated bid was expected to be, Neiss said, “We issued an addendum to those interested in doing the work.”
According to the bid packet, “Addenda will be mailed to each person or firm recorded as having received the bid documents …”
Neiss reiterated, “No bid bond was required,” citing it was only noted in the addendum as a “reminder.”
He said, “This was a very transparent process. When I presented it to you – the Reader’s Digest version – that’s not how it played out in the paper. I wanted to do my fiduciary duty.”
Councilman Bob Coady said, “What the public heard was that the work was estimated at $30,000. All the bids were over $20,000. Did we give these contractors a cap?”
Neiss responded, “We anticipated this would be less than $18,000.”
Carefree resident Lyn Hitchon has repeatedly touted how the town was getting a good price because, according to Miller, the work was estimated to cost as much as $30,000.
If that were the case, it should have been advertised to the public for open bidding.
At least two contractors invited to bid claim Miller repeatedly mentioned at the pre-bid meeting that the bids would need to come in at less than $19,000.
Regardless of what was said, the bid packet explicitly states, “The town will not be responsible for oral instructions or information. In the event questions are received less than three days before the bid opening, a determination will be made by the town concerning the sending of a written addendum, which may result in the establishment of a new bid opening date.”
Coady asked Neiss, “Did contractors have a preconceived notion of how much this was supposed to be?”
“No,” replied Neiss.
When Coady asked if they sent the addendum to all the companies invited to bid, Neiss said the addendum was only sent to the three 9 a.m. bidders.
Coady read from Section 3.2 of the bid packet and asked Neiss, “Shouldn’t it have gone to a new bidding process?”
Neiss said Miller acted as a “liaison for council.”
Coady reiterated, “This says town council can negotiate, not the vice mayor. I’m not happy with this at all,” and asked that an independent investigation be conducted.
Miller said, “I don’t know why you’re picking on Gary. He could have gone to one contractor and asked for a price.”
Councilman Peter Koteas asked, “When you put together the addendum, didn’t you think it was odd that one bid was $5,509 over and another was $1,645 over?”
Koteas asked, “Doesn’t it sound like someone was given guidance? Don’t you think it’s odd? Why would the difference be so significant?”
Schwan interrupted and said, “For the record, an accusation has been made.”
Councilman Doug Stavoe suggested the town formulate some sort of standardized process.
Miller recommended, “When we do the court pre-bid … I suggest you be there when we do the bid opening.”
Schwan said, “I was present when the first bids were opened. In my mind, we did go to another bidding process.”
Chenal stated, “My opinion is, a procedure needs to be developed so we all know what the rules are. We need to clear the air.”
Statute provides for such under A.R.S. § 41-2535(D), known as the “simplified construction procurement program.”
The rules minimally required by statute include that a list be maintained of persons who desire to receive solicitations to bid on construction projects; all information submitted by bidders be confidential as per the sealed competitive bidding process; all bids for construction be opened at a public opening; all persons desiring to submit bids be treated equitably and the information related to each project be available to all eligible persons; along with a few other requirements.
Gemmill said he worked very closely with Neiss on the gas lights and other projects, touting Neiss’ integrity, and stated, “I’m appalled at the accusations being made. It’s a poor statement on this town.”
Town Attorney Tom Chenal read council the conditions under which no bids are required from A.R.S. § 34-201 and stated, “My opinion is, a procedure needs to be developed so we all know what the rules are.”
Town Clerk Betsy Wise is to Chenal’s left.
Photo by Linda Bentley