May 2 2011

LWV Task Force Presentation on “Lessons Learned in Undergrounding” Sends Council and Staff back to the Drawing Board

The Piedmont League of Women Voters Task Force on utility undergrounding presented its extensive investigation in a public forum entitled “Lessons Learned in Undergrounding”on April 26.  Task Force members Mary Heller, Rob Hendrickson, Kathleen Quenneville [Chair], Al Peters and Alex Gunst discussed their findings and recommendations.  The Task Force expertise includes construction litigation, public policy administration and legal issues, engineering, accounting, mediation, construction management, and past experience as a Piedmont Mayor.

The City Council Chamber was filled to capacity with  citizens interested in the presentation and discussion of a failed and costly private undergrounding district. The Task Force made the following suggestions for changes to Council and staff procedures and policies to prevent failure and cost overruns in future underground utilities and other civic projects.

The City Council’s Role

– Procedures to protect the City are necessary for all major projects (not just undergrounding), including assessment of all risks and a determination of whether unexpected expenses will be borne by proponents of a project or the City.

– The School Board demands extensive information and data allowing informed decisions; whereas the City Council is the “polar opposite.”  The City Council should also require detailed information. The Council makes decisions without sufficient information as with the Swim Club and Blair Park.

– The Council  creates a conflict of interest when it loans  public monies (20A funds) to private undergrounding districts to encourage undergrounding.  If the Council then votes not to approve the  project, the 20A funds will not be repaid to the City.

– No costs should be borne by the City for private undergrounding.

– The Council becomes vulnerable to unknown costs when private funding for City improvements is offered – such as undergrounding or Blair Park. Informed decision-making by the Council is important for prudent, fiscal management.

– Despite information about the eventual $2+ million taxpayer expenditure not being available to the public prior to the City election, the Task Force found no indication of any intentional effort to avoid releasing information.

– The Council may not be asking the City Administrator to raise issues and highlight risks.  The Council should expect this from the City Administrator, rather than viewing his role as merely to facilitate whatever project is being considered.

– The problem was not the rock encountered during construction, it was inattention by the City Council and staff to contracts, risk, and management.

– Policies need to be adopted to clarify lines of authority and time lines of projects.

Staff Procedures & Roles

– Decision making was by committee with no clear lines of authority among the staff for prompt reporting of problems to the City Administrator and Council.

– An independent project manager should be required to supervise and directly inform the City Administrator, and the City Council as necessary, on project developments.   The independent project manager needs to be involved from the outset.

– Staff’s time was and continues to be used for private purposes, as if it is free, without assessing actual cost to proponents.  This practice has been seen with PRFO  [developers of Blair Park],  as well as private undergrounding projects.

– The City Administrator should stay informed.

– Projected cost trend lines should be considered when construction is underway in order to spot problems early.

Structure & Procedures of Projects

– When undertaking a project, it cannot be assumed everything will go right. Risk management was absent and needs to be a part of any project, including mitigating or minimizing the risk.

– Harris and Associates, long time City Engineers, were dismissed when they could not meet the desired budget, resulting in the selection of another engineer who provided a much lower cost.

– Bids and contracts need to be assessed by experienced, knowledgeable individuals, rather than relying on in-house staff who do not possess the specific type of experience needed.

– All costs of a project need to be identified and assessed to project proponents including a required independent project manager hired by the City and reporting directly to the City.

The voting percentage for undergrounding district approval has been changed from 70%  to “50% plus one”.  Strong consensus is needed when assessing homeowners in a district tens of thousands of dollars, and therefore 70% is a more appropriate percentage.  Also, the voting percentage criteria for undergrounding approval should not be changed by the Council as the approval process proceeds for a specific district.

Faulty procedures have not yet been altered for new projects being undertaken by the City including Blair Park and the pools.

During the presentations, the Task Force members and public were reminded by the Chair that the failure of particular staff members is a personnel matter to be handled privately by the City Council.  The current mediation process between the City and engineering firms is ongoing.  No lawsuits have been filed.  The City may or may not recoup the over $2.2 million dollars spent as a result of the problematic undergrounding work. The Task Force encouraged the City and Council to look at itself, rather than looking to blame others.

Both Council Member Garrett Keating and Audit Subcommittee Member Ken Kawaichi attended the forum. None of the benefiting residents involved in the formation of the Piedmont Hills Utility Underground District were observed in the audience.

2 Responses to “LWV Task Force Presentation on “Lessons Learned in Undergrounding” Sends Council and Staff back to the Drawing Board”

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