HomeMy WebLinkAbout03-03-1998 Meeting
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REAL ESTATE MEETING
COMMITTEE ROOM - March 3, 1998
PRESENT: Hons. Larry Sconyers, Mayor; Todd, J. Brigham,
Mays, Kuhlke, H. Brigham, Shepard, Beard, Powell, Handy and
Bridges, Commissioners; Jim Wall, Attorney; Randy Oliver,
Administrator and Lena Bonner, Clerk of Commission.
Mr. Wall: We've got a contract amendment that has been
presented. One of the things that has come up is Keven has
requested that appropriate language be included in the amendment
that would require that the rehabilitation work be done from the
approved list of contractors that his department has. This is
with the Richmond group or the Olde Town Properties and that is a
requirement that is not mandated by HUD. It would be required
that it be bid but that wouid be a part of the loan documents,
etc. as far as HOME is concerned and before that contract
amendment is signed, if that is going to be a requirement, we
need to write that in. It's my opinion, and Randy's opinion,
that that will kill the deal.
Mr. Kuhlke: Is our primary objective to get out of this
thing?
Mr. Wall: Yes.
Mr. Oliver: Yes. The state has given us $2 million in HOME
money plus the historic tax credits that they've allocated.
Mr. Kuhlke: And I think, and this
that's a deal killer, to hell with it.
let them use who they want to use to do
is contrary to Keven, if
If we can get rid of it,
whatever rehabilitation.
Mr. Oliver: I think one of Keven's concerns is very valid.
We want to ensure that the work is done properly this time. We
don't want a cosmetic paint job and I think we can ensure that
and I'm not worried about that. As it relates to the bidding
requirement, I don't profess to be smart enough. The agreement
as it's structured right now requires them to adhere to all
federal guidelines. They have a slightly different opinion right
now but we are of the opinion that it's between them and the
federal government. Whatever the federal government says that
the guidelines are, we're going to adhere to. I guess the
question before you all is is whether we want to make the
requirements more stringent than those federal requirements, and
if so, how much more.
Mr. Todd: My position on it is that they're using our
housing money so I think whether it's in the contract or not,
they should give us some consideration as far as Richmond County
base. I'm sincere about that. I understand that if the
contractors have the same mandated classes, certification by HUD,
as the ones here, then I don't think legally we can pin them down
to use the local contractors or the contractors here. They have
to keep in mind that we are reprogramming a percentage of our
housing money or rehab money to this project and I think it needs
to be made loud and clear to them.
Mr. Oliver: About $550,000 a year for two years. The thing
that becomes a bit cumbersome and awkward, if you have an
approved list and they choose contractors from the approved list
you incur some potential liability from saying we view them as
being okay. I personally believe that it should be a fair and
open process but to restrict a project of this size to a certain
approved list I don't think is in their best interest and I
think, as Mr. Wall has indicated, would make the deal not go
forward.
Mr. Beard: I agree we don't want to kill this deal but I
think there is some effort from the government could be put forth
that they would consider using some of those people. I don't
think we can mandate them to use it and I wouldn't go to that
extent ...
Mr. Oliver: Well, we're going to encourage that.
Mr. Beard: ... but I think you should do everything to
encourage that we have some participation.
Mr. Oliver: I agree with that.
Mr. Wall: And that's not a problem.
Mr. Beard: I think we've gone too far to kill this thing by
putting that stipulation or mandating that.
Mr. Todd: It's not a good deal for us, in my opinion.
Mr. Kuhlke: It could be worse.
Mr. Oliver: It's a worse deal if you lose the state's
participation.
Mr. Mack: To address Mr. Kuhlke's point, we're not in the
business. We won't be in the business. These contractors are
independent contractors and they will bid on these projects. The
only thing that would happen is that it would be limited to the
15 people that are already on our list, that do work for us on a
daily basis.
Mr. Kuhlke: And I think that's where we've got the problem.
I think that, as Mr. Beard suggested, if we offer them the list
but don't mandate the list, it's a lot of difference. Is that
what you're saying, Jim, if you mandate that you've got to pull
from that list,
Mr. Mack: Not pull, but let these people be able to bid on
that.
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Mr. Kuhlke: If they want to.
Mr. Wall: I think the question of whether or not the
bidding will be mandated or not is something that I want them to
deal with HUD on and I want us to insure that whatever HUD
requires, that they do. They have e-mailed us and they've gotten
an opinion from a Washington attorney that they're not going to
have to bid because of their interpretation of the rules. I
think HUD is going to require them to bid. If in fact they bid,
then these 15 companies should be included in the list, but they
need to bid on the whole project as opposed to bidding on this
unit, this unit, this unit and through that process, we can
encourage them to submit bid packages to these 15 companies,
encourage them to use them, etc.
Mr. Handy: I don't think we have people on the 15 staff
that are capable of bidding the whole business.
Mr. Mack:
on houses every
paint on it.
We might not have one person but these people bid
day. They don't just go in and slap a coat of
Mr. Handy: Now you are making it more complex than what it
is. I understand what you're saying about bidding on it. If we
have money involved in that thing and we've got 15 people, we
don't necessarily have to take the 15, we could at least take
seven of them or half of them because we still have money
involved in it. But there's no way that we have anybody that
works for us doing the little rehab we've got that could take
that whole project.
Mr. Oliver: If I were the owner I wouldn't want to deal
with 15 or seven different contractors. I'd want to deal with
one general contractor.
Mr. Handy: Right. I understand. That would eliminate us
from the get go because we don't have nobody out of the 15 that
can take the whole project.
Mr. Wall: Well, I understand that and that may be true but
they might joint venture somehow among themselves so that the
company is only looking to one entity.
Mr. Handy: That's sounds a little bit better.
Mr. Mays: You might have answered right on the tail end of
what I was going to bring up to ask. I can see their point about
being the owner but I think the one common denominator that makes
them a little different is that it's about time that some
moderate folks share in some big bang. You've got a lot of small
contractors out there who, regardless of age, race or sex, are
struggling to make it out there and then you get somewhat of a
big project to come and maybe they can't do it that way, and I
guess what I'm going back to is the situation where you work with
the small Sanitation folks and where that was put together on the
joint venture to ensure that they were at least in the ball game.
I think if you have been e-mailing, negotiating and I, too, don't
want to lose the deal, but I also know that every time something
comes up where there's a good buck to be made, that it marches
out the city and you get folk that may even to the point end up
on our indigent care rolls that we turn around and have to pay
for because certain companies can come in here and do work and
don't even have to insure folk and leave. The only thing that
some of these small folk get a job on is the little (inaudible)
that may be done on $15,000 or $20,000 worth of work. It might
be late in the game to encourage or do that but I think that
might be a way of bringing some of those folks into the fold and
while negotiating without forcing or saying you're going to force
any of them to do it, maybe that idea needs to be openly put to
them. We've got a program here and a lot of money in here and
we've got an old City government that we inherited that was
accused of not putting it back into where you had low and
moderate income folk to do it and share with the small
contractors. What's your position on doing that and put some of
them together and getting that. And if you've got one fellow in
the bunch that wants to coordinate that, we've got seven that we
can bring to the table and do it. I think you've got some city
money in there and you're only getting that money to have because
you've basically got poor folks in the City. That's why you've
got that money; it ain't coming from no other pocket. So I do
think you have some level to have to play to throw in there, at
least maybe in the negotiating part of it. I agree, it shouldn't
probably be in a hard line, written deal because it may fall
through and you're stuck with the sucker again. But I don't
think it hurts anything to say to folks that we've got some folks
doing some work, that's all they've been getting, let them get a
shot at the big deal that you've got in here and even if we have
to put maybe our five best ones together and offer them to you,
you go interview them, you go check their records, you go see
what they're like and then you've got something they can work on.
I think it's worth a shot with some of them doing that.
Mr. Mack: Randy, Jim and I have been discussing this back
and forth. One of the things I want to do is make sure our City
doesn't get in the same predicament with Olde Town that it is
today five more years down the line. We want to ensure that
there are proper plans, specifications and that this is bidded
and inspected to where it's supposed to be. Our inspectors
inspect this work and they will not pass work that the City
inspectors will pass.
Mr. Oliver: It is more detailed, I agree.
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Mr. Todd: This money that's going to be used, if we weren't
programming it into this project, I think a lot of us really - we I
had everything amended and thrown at us and we really didn't have
time to go through this package - I've gone through this package
and if I look at it as far as unloading this property, it's a
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good deal probably but I think it's costing us to do this.
They're using money that our contractors would be - they're
losing opportunity because it means there will be less work in
other rehab, small projects that they could do; therefore, I
think this entity should give those contractors here a chance to
do the work.
Mr. Beard: We ought to be able to work out something to
deal with this problem we have here. I think they can understand
what we want and it shouldn't be soft-soaped, it should be a hard
sellon those people but not enough to kill the deal.
Mr. Wall: Okay. Thank you.
ADJOURNMENT: There being no further business, the meeting
was adjourned.
Lena J. Bonner
Clerk of Commission
NWM