elpasospeak

FedUp and Reality Checker have  brought up good points questioning how our ball park costs can be so far different from the $50 million that we were promised they  would not exceed.

After all we have:

• the city manager
• a deputy city manager with experience from the Arlington stadium project
• a chief financial officer of the city
• the city engineer

all working diligently on this project for us.

In addition, we have some real professionals including:

• International Facilities Group — hired to be the owner’s representative — being paid up to $853,000 dollars.  Quoting directly from their contract with the city:
  • The Consultant acknowledges that the construction budget for the Project allocates THIRTY FIVE MILLION AND NO/100 DOLLARS ($35,000,000) for the award of a construction contract base bid, which is to include all features essential to the operation of the Project for its intended use …”
• Turner Construction who has done 25 ball parks according to this estimate available on the city web site.  4×3 Turner Construction v2 – 6_25_2012 (1).  Their estimate was $38,923.00.  They did not get hired to do the job but after having done 25 ball parks I would think that their estimate deserves respect.
• Populous, the construction architect.  They are being paid $3,820,680.00 to design the ball park with the same $35 million construction budget written into their contract.
• A construction company that has a contract with the city to build the ballpark with a construction budget of – $40,182,111.
• One of the owners of the sports group is ranked number 65 (according to their web site) of the top 300 building contractors.  Certainly they are experienced with cost controls and budgets.

I would not be surprised if some of these firms do not come to the city expecting increases in their fees, after all they were hired to build a much cheaper facility.

A contract is a contract

The public has been made aware of the various costs through city council entering into contracts.  Who has been driving the costs up?  By what authority have they been doing it?

We had an estimate from an experienced ball park builder totaling $38.9 million.  The city wrote contracts capping construction at $35 million.

Now we are at some number above $64 million.

The professional firms may have some liability here.  Their reputations might suffer also.  I doubt that they would make changes without direction from their masters at the city.

That leaves us with

The city employees are the ones that are most directly accountable to us.  City council should investigate to find out which of our people is responsible for this and then take the appropriate actions.

We deserve better

Brutus

The letter from the sports group to the mayor about the most recent ball park cost overrun includes this statement:

“As a result, the City and MountainStar began discussing additional ways to cover these anticipated additional costs which could be as much as $10 Million.”

On July 2, 2013 city council considered and passed  this agenda item:

Discussion and action regarding a Resolution modifying the authority granted to the City Manager in connection with the awarding of Solicitation No. 2013-109R to Jordan Hunt, a Texas Joint Venture for the construction of the ballpark and requiring the exercise of all such authority be made in consultation with the Mayor of the City of El Paso.

The mayor is supposed to be part of any negotiations.  Has he been?

How long has this been going on behind our backs?

We deserve better

Brutus

I wrote this before the news conference last night.  To me the thoughts are still relevant.  The addition that I would make is to thank the mayor.  Having a strong leader as mayor makes a difference.

I wouldn’t want to be in the mayor’s shoes relative to the latest ball park cost overrun.

Any concession that he makes in a contract modification will be seen by many of the citizens as a sell out.

We were sold a bill of goods by city staff.

Then city staff came to us with a $14 million cost overrun.  Some city council members feigned outrage.  “No more” they said.

Then city staff bungled the bond sale and cost us $17 million in extra interest.  Council went along with it.

Now they need another $10 million.  The sports group has offered to repay it after the stadium is built.  The sports group wants some contract changes.

Is their $10 million dollar offer only good after the stadium is built because there is fear that there will be even more cost increases?  Otherwise, why not pay it now?

Unfortunately these people have lost our trust.  Even if what the city is considering makes sense, we do not have a reason to believe anyone is acting with our best interest at heart.

I think that the mayor’s best chance here is to act in a strong and open manner.

Whatever he does needs to be well publicized with nothing hidden.

We deserve better

Brutus

Unfortunately we have  just learned that they want another $10 million for the ball park.

We started at “not to exceed” $50 million.  There was even a clause in the contract that gave the construction manager part of the savings if the project came in under $50 million.  Nice deception there.

The city increased that amount to $64 million a few months later.  Some members of city council threw fits and made threats about firing people if the project was not controlled.

The city handled the bond sales poorly and ended up costing us an additional $17 million in financing costs that are not included in the numbers above.  Council demurred.

Now the sports group says it will take another $10 million, hopefully  to finish the project.  They say they will need a few other things too, like a contractual commitment to use quality of life bond money to build things that they feel are necessary around the park.

The sports group says that they are willing to repay the city the $10 million but they will need:

Any money they pay will have to be allocated to the portions of the stadium that provide the best tax advantage to the sports group.

The right “to modify the Ballpark Schedule, Project Plans and Ballpark Budget”.  In other words, control of the project.  That might actually be a good thing.

Clarify “that certain ancillary City improvements that complement the Ballpark are being paid for with City funding sources other than the Ballpark financing”.  The city’s plan has been to spend quality of life bond money to make the neighborhood better facilitate the ball park.  The city also has been spending money on improving the utilities.  Up until now those costs have been pretty much hidden.  Now the sports group wants a commitment.

The right to close Missouri street during any event that they have at the ball park.

The city will need to “exchange the City’s right to use a Ballpark suite with an equivalent number of tickets that include a reasonable combination of Ballpark party suites and other preferred seating…”  We did not know until now that the city negotiated the right to use a suite at the ball park into the original agreement.  I don’t expect  an invitation as I suspect that the suite will be used for the privileged overseers of the city.

Fasten your seat belts

More bad news will be coming in the next few months.  We still don’t know:

What the design will look like

The dimensions of the field

When it will be finished

How much more it will cost to complete it

How much money will be spent on projects near the stadium

Who knew what/when about this mess

What action bond holders may take since they were not told the truth.  Lying to the citizens does not bring the same legal problems as lying to the bond buyers.

Avoidable

These cost over-runs are avoidable.  We could have had a $50 million stadium.  The architects were hired to design a stadium that could be built for $50 million dollars.  The extra $24 million is for things that the city and the sports group think will make the stadium better.  Better in this case means increase their revenue stream.

We deserve better

Brutus