Sandy Springs may sue PCIDs,
CH2M over $2.8m street funding dispute
The city of Sandy Springs may sue
the Perimeter Center Improvement Districts and a company that once ran the city
government over paperwork errors forcing a repayment of $2.8 million in federal
streetscape funds.
The City Council voted unanimously
to authorize legal action against the PCIDs and the company CH2M Hill at its
Aug. 16 meeting after discussing the dispute in an executive session. City
Attorney Wendell Willard said in an interview he is hopeful the leverage will
help negotiate an agreement, especially with the PCIDs, without going to court.
“If [we] can’t get them to step
forward and honor their obligation under contract, we may have to take legal action,”
Willard said. “We’ve had a good relationship and hope it can continue.”
PCIDs spokesperson Tammy Thompson
declined to comment and CH2M did not immediately respond to an email.
The dispute involves a sidewalks and
streetscape beautification project along Peachtree-Dunwoody Road between I-285
and Abernathy Road carried out around 2008 and 2009, Willard said.
The PCIDs commissioned the project
using federal grant money provided through the Georgia Department of
Transportation, with the city acting as a fiscal agent required under the grant
policy. The PCIDs are two jointly operated self-taxing business districts, one
in Fulton County and one in DeKalb. The grant—and the possible
lawsuit—specifically involves the Fulton PCID.
Years later, in 2014, the Federal
Highway Administration audited the grant for compliance with its terms.
According to a written statement from the city, the audit found
“non-compliance” in the project’s paperwork, including “lack of information in
the files related to materials and testing information; missing sediment and
erosion control reports; and failure to include Buy America requirements [a
mandate to use American-made products] in the Project contract.”
The federal government demanded its
nearly $2.8 million in grant money back and sought reimbursement from GDOT,
which in turn demanded the money from the city. Willard said that, rather than
hitting the city with one huge bill, GDOT has agreed to deduct the money from
the city’s annual allotment of state road-paving funds.
Meanwhile, the city argues that
PCIDs is on the hook for the funding under the terms of the project agreement.
The city and the PCIDs have discussed the dispute for some time without
resolution, Willard said. “They’re sort of crossing their arms [and] haven’t
done a lot,” he said.
Willard said the city also believes
that CH2M was responsible for vetting the project’s compliance. At the time,
CH2M managed the city’s public works and administrative services under Sandy
Springs’ model of outsourcing nearly all government departments to private
contractors.
“And on the other side of the coin,
what was the obligation of the city?” Willard said of CH2M. “We think they have
some responsibility.”
In 2011, Sandy Springs left its single-contractor government deal
with CH2M, saying it was costing far too much
money, in favor of bidding various departments out to several contractors.
City Manager John McDonough has
ordered city staff to audit other similar city contracts and agreements to see
if any are vulnerable to this type of paperwork and bidding error, Willard
said, adding that he has not heard of any further situations.
Comments
So, the audit found “non-compliance”
in the project’s paperwork, including “lack of information in the files related
to materials and testing information; missing sediment and erosion control
reports; and failure to include Buy America requirements [a mandate to use
American-made products] in the Project contract.” Who was the project manager ? If they can’t determine that then all the players
involved in this debacle including the Federal Highway Commission, PCID, GDOT, the
City of Sandy Springs and CH2M should each cough up 20%.
Federal
grants like this should be avoided by cities when the compliance requirements
go on and on with a “gotcha” at the end.
Most of their requirements only add costs to these projects. I can only imagine how you do a daily
“erosion control report” and I doubt that any concrete came from China or steel
came from the US. What planet do these folks live on ?
Norb
Leahy, Dunwoody GA Tea Party Leader
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