Tahlequah Daily Press

February 27, 2014

Over budget

Work on North Cedar likely violated bidding laws, siphoned money from other projects

Staff Writer

TAHLEQUAH — Funding earmarked for two Tahlequah street projects had to be diverted last year to pay for work on North Cedar Avenue, a venture that apparently violated state bidding laws and ran $180,000 over budget.

According to construction records obtained by the Daily Press, city officials allocated $155,000 for the North Cedar Avenue project, which had been on the back burner for several years.

When the dust settled on the work last year, the city had spent more than $336,500 and still fell about 125 feet short of the intended mark, according to officials.

Street Commissioner Mike Corn refused to comment on the findings other than to say his crews stopped working on the street project last year when Assistant City Administrator Kevin Smith asked them to do so.

“I’m just out here trying to do my job,” Corn said.

Smith asked Corn to halt construction when city officials were presented with purchase orders totaling more than $50,000.

“It set off alarm bells,” said Mayor Jason Nichols.

According to Oklahoma’s Public Competitive Bidding Act, public construction contracts exceeding $50,000 must be awarded to the lowest bidder through open competitive bidding, after sealed bids have been sought. City leaders determined that process had not been followed.

“In the best-case scenario, an engineer should be involved to tell you about what a project is going to cost, and if it’s anywhere near $50,000, it’s best to be on the safe side and bid it,” said Nichols. “But that wasn’t done here. The street commissioner elects to do these projects very informally and very loosely, and we don’t know what costs are going to be.”

According to Nichols, labor on the project was “basically complete” by the time he and Smith discovered the alleged violation of bidding laws. After discussing the issue, city officials sought bids for the unfinished portion of the work.

Smith says work on the street stopped about 125 feet short of its expected end when money ran out.

According to construction records, $235,998.88 was spent on the project with money from the general fund. Later, $47,790.25 was taken out of a “rollover” fund, and an additional $52,745 was siphoned from a street and alley fund.

Nichols said two other street projects – one on Redbud, at a cost of about $80,000, and another on White Avenue, costing about $25,000 – were put on hold so money could be diverted to finish North Cedar.

“It’s inexcusable,” Nichols said. “It’s a result of how business is done in the street department, and this is how we fall behind.”

The mayor believes the $155,000 budget estimate provided by the street department was based on construction costs from as many as six years ago and was for a smaller road – one that didn’t meet the city’s road construction codes.

Because the project began outside of code requirements, part of the work had to be redone last year. Corn, during a city council meeting, accepted blame for the issue and agreed to bring the work up to code at councilors’ requests.

Nichols believes the do-over has cost the city “tens of thousands of dollars.”

A few more thousand dollars may have to be set aside to redo a project to stencil “sharrows” on city streets to warn drivers they’re sharing lanes with bicycles. Local drivers last week complained the markings were too small to see from their vehicles.

Corn, who procured the contract, has also fallen under fire for that project. Although Nichols and Tahlequah Main Street Director Drew Haley accepted some of the blame for the size of the stencils, both say they asked Corn to halt the work when Corn himself observed they were too small. The project continued unabated, and Corn said he did not receive an “official” request to halt the work until it was too late.

As reported in Wednesday’s Press, it has since come to light that Corn may have violated state law when he enlisted Terry Keys of T&K Construction to do that job. Keys charged the city $9,000 – $40 for each of the 220 stencils – and subcontracted the work to Jimmy Thomas, agreeing to pay him $20 per stencil.

Corn did not let that project for bid, nor did he obtain a timely purchase order for it, though it appears a requisition – which had not been signed by Nichols and Smith – was filled out after the fact. The Press had asked for the PO Feb. 19; the requisition, which the Press received Feb. 22, was also dated Feb. 19, several days after the sharrow work was completed.