Council refuses to pay blackmail (at least for now)

A city council consent agenda, according to the Municipal Research and Services Center, "is a tool used to streamline council meeting procedures by collecting routine, non-controversial (emphasis mine) items into a group whereby all are passed with a single motion and vote."

Except for a teeny, tiny group of individuals without functioning cerebral cortexes (including one council member) who tried to create a controversy where one obviously did not exist out of the city manager’s proposed contract extension, the single most controversial item on last night’s city council agenda turned out to be the very first one on the Consent Agenda (that section where controversial items are not supposed to hide). Jerry Hendrix, the city’s chief of staff, informed me today "The city manager and mayor review the agenda and make the final decision on what is placed on consent."

I’m not saying that either one tried to slip something nefarious by without due consideration. Change orders, specifically ones under $50,000, are usually found on a council’s consent agenda and this one was for $35,803.36. This change order involved work being performed on the Tenorio Wastewater System Rehabilitation Project, i.e. improvements to the city’s wastewater infrastructure, in the vicinity of Wallace Middle School. According to City Engineer Leon Barba, the project not only involves extending the city’s wastewater lines, but it "also replaced about five houses that were on septic systems and pulled a lot of the old lines that were behind fences and backyards and put them out into the streets where we could have better access to them as far as maintenance is concerned."

According to the contractor, Guerra Underground of Austin, the additional 35 grand was needed because "There was a 9 a.m. to 3 p.m. work hour restriction for a 50-foot section. However, after setting up traffic control lane closures and starting construction activity it was determined that it was not possible to keep traffic control in place with construction activity in Center Street during Wallace Middle School pick and drop off hours. It was agreed upon to extend the restricted work schedule until we passed middle school entrances. The result was 9 a.m. to 3 p.m. work in the zone. Because of set up, take down time and clean up, actual digging could only take place for four hours. The restricted schedule resulted in an additional 12 days of equipment and labor necessary to install the section in front of the middle school."

That’s Guerra’s side of the story. The City of Kyle’s side is a little different.

"My biggest concern in regards to this additional income is that it says it’s because they are restricted by work hours due to school related traffic," council member Daphne Tenorio told Barba,

"Yes," the city engineer replied. "There was a section of road that we wanted to make sure they were away from the driveways with all the school traffic and the bus traffic that is and the project took longer than what we expected and so they were there longer. So they agreed not to start before 9 and to get out of the area by 3 o’clock."

The key phrase in Barba’s above response was " the project took longer than what we expected" and Tenorio jumped on it.

"Didn’t they know that was going to happen prior to the contract extension?" she asked.

"We had an anticipation that it was," Barba said, "but they just didn’t work as fast as we thought they were going to work."

"I kind of struggle with that concept as well," council member Travis Mitchell said. "They were the ones that delayed in construction. Then how is it that we are paying the additional funds on that project? It seems to me they are saying ‘We can’t complete this project on time so that entitles us to a bonus.’ It comes across as a cash grab to me."

Barba then dug the hole a little deeper.

"We expected them to move faster on that project when we put the contract together," he said, "but it didn’t happen that way. If he had used a different technique, a different method, it might have worked out that way, but he did not. He chose t to use the method he was used to using. And because of the technique he was using, it delayed him getting through the intersection."

So what’s happening here is the contractor is threatening to walk off the job without finishing a project unless he is paid additional funds for additional time needed to complete the project, additional time that resulted from the contractor’s own methodology. That’s blackmail, pure and simple. And the contractor figures he can get away with it because bringing in a new contractor usually means starting the project completely over. In other words, the original $443,940 awarded to Guerra would become money flushed right down the wastewater pipes (if and when those pipes are completed). In effect, he’s demanding the city reimburse him $35,000 for his ineptitude or pay someone else close to a half million to complete the project on time according to a new schedule.

But that’s not the end of the story. Not by any stretch of the imagination. Barba still had another bombshell to drop.

"Actually, this is a negotiated price we worked with the contractors," Barba told the council "It was originally much higher. So we negotiated with them, explained to them that this was something we hadn’t planned. We wished he had moved faster but it’s the contractor’s choice to move as fast or as slow as he wants to. We did negotiate this price with him so it’s substantially lower than we were expecting he would charge us."

In a classic understatement, Mayor Todd Webster told Barba "I’m not sure you helped yourself there."

Barba said the change order adds 12 additional days to the number specified for completion of the project in the original contract. "The bottom line is he didn’t move as quickly as we expected him to do." Barba said.

"As I’m listening to this," Webster said, "it sounds like you didn’t agree with the methods they were using. Even though it wasn’t up to us to tell them how to do it, it sure sounds like the methods we didn’t agree to extended the time and it’s a pretty persuasive argument that my colleagues are making that extending the budget for this because it’s a delay sure doesn’t come across to me either as appropriate. I think we need to know exactly what the contract says and what are the consequences if this item does not get approved. Are we contracted to pay the additional $35,000 or are we volunteering to pay?"

City Manager Scott Sellers told the council "The change order was not met very well by staff. I’ll just be very blunt. I strongly opposed this. The question is: How do we finish the project? If we do not pay this, the contractor does not finish the project. At this point it was more cost effective to keep the contractor on site to finish the project rather than get a new contractor on scene to finish it. We don’t have the equipment in-house to do the project. While the price came down very significantly because we voiced very strong opposition to the change order, I can say for what we are paying we will at least get the project done."

I repeat: Holding someone or something hostage in order to receive money is blackmail and that’s just was Sellers described was happening.

"However," Sellers added, "future projects by this contractor may not be viewed very favorably as they are bid in the City of Kyle. And I believe the contractor understands that. So we are trying to get the project done with this change order. The project is close to being done and to stop progress right now has a significant cost to getting it done."

Webster said he intuited that a majority of the council was determined not to pay the blackmail "I think there is more here than I think we can understand in terms of what the potential risks (of not paying) might be," the mayor said. "I see some wisdom in getting some legal advice to understand what our options are. I don’t feel I could vote in favor if it, but I want to understand what the potential risks are."

As a result, the council decided to move discussion of the matter into its planned executive session at the end of last night’s meeting. After they emerged from the executive session, the council voted unanimously to indefinitely postpone consideration of the item; i.e., hold off on the blackmail demands until other options can be explored.

In other matters last night:

• A minuscule .007 percent of the city’s population showed up at the meeting to voice objections to the city manager’s proposed contract extension and even they couldn’t provide a coherent rationale for their positions — all three of them acknowledged Sellers was doing a good job as city manager. During debate on this subject, Mayor Pro Tem Damon Fogley noted "The public sector has always had this stigma of you shouldn’t earn as much as people in the private sector. I see it in a different light. You have to pay for what you get and if you compare what our city manager does to what a CEO does for a private company their job functions are essentially the same, overseeing a variety of different departments with different job functions." (To illustrate Fogley’s point, Seton Medical Center won’t divulge the salary of its current president and CEO Jesus Garza, but, according to published reports, Garza’s predecessor, Charles Barnett, received a base salary of $670,468 in fiscal year 2010-11 and his total compensation package during that year was close to $2 million as compared to Sellers’s proposed $196,503 and $243,515.62.) The council voted 5-1 (council member Becky Selberra missed last night’s meeting) to approve Sellers's contract extension with Tenorio voting no, stating the totally irrelevant fact that "When I did my own research, currently the average income for the citizens of Kyle is $77,400 (frankly. I’m shocked it’s that high) and your current salary will be two and a half times the average." As anyone who has even dabbled on the outskirts of employee relations knows, salaries are "determined by market pay rates, established through market pay studies, for people doing similar work in similar industries in the same region of the country." And, as Mayor Webster noted "We looked at the salaries at other cities, looked at the average of those and came to an amount that was really close to that average." In fact, Sellers’s salary varies from the average salaries of other area city managers by 69 cents a day. 69 friggin' cents a day!!! If 69 friggin' cents is what’s causing anyone, including a member of the city council, to go off the deep end here, I’ll volunteer to come to City Hall every day this year and chip in the 69 cents to make up the difference.
• Right after the vote was taken to approve the city manager’s contract extension, Sellers illustrated once more why he is worth it by revealing the City has received another grant, this one totaling $132,215 from the EPA, for a green facility at the wastewater treatment plant. "Many months ago we embarked on a grant that would allow the City to construct a facility that would serve as its admin building. There may be some testing in there. But we knew we would have a very large wastewater treatment plant expenditure ahead of us and we were looking for any way to bring down the cost. This is a grant that essentially provides green infrastructure for wastewater facilities. So this building won’t just be your average, run-of-the-mill building. It will involve such green infrastructure as rainwater harvesting, vegetative soils, porous concrete, native grasses and vegetation, and xeriscaping. Included in the building is an area we will have open for the public to come in and learn more about conservation measures and get to see those measures in action." Sellers told me today the building was not designed with LEED's certification in mind "as that relates to energy efficiencies, but it is designed for LID (low impact development) to mimic natural environmental processes."
• The council voted 5-2 (Fogley and Tenorio objecting) to approve on the second reading an ordinance giving Kyle to third highest impact fee schedule in the area. The new rates apply to any development that had not had its final plat approved before last night’s action. Concern was expressed about one proposed apartment complex whose final plat was submitted as early as last November but kept getting rejected by the City, but city staff sort of, kind of, acknowledged that concern can legally and will be resolved separately.
• The council approved 5-1 (Mitchell objecting) on second reading an ordinance creating an R-1-3 residential zoning that now means three planned developments whose zoning requests have been appearing on both the Planning Commission’s and the City Council’s agenda repeatedly during the last two months but have been delayed each time (as they were again last night) can now move forward seeking that new zoning designation.
• The council approved 5-1 (Mitchell objecting) to change the zoning on 4 acres of land located at 1381 Goforth Road from agriculture to retail services, although the prospective land owner originally asked for warehousing zoning. Mitchell voted against because he thought warehouse zoning was both compatible and appropriate. At least the council’s debate on the issue, unlike the debate at the Planning Commission, did bring up the subject of land use.
• At the staff’s request, the council postponed indefinitely a plan to spend $100,000 for drainage improvements to a culvert on FM 2770 just north of Hellman. No reason was given for the delay and I must admit I failed to seek a reason after the meeting was over because I was interested in getting answers to higher priority questions. But I’m guessing it might be one or both of the other partners in the deal might not have all the pieces to their respective puzzles in place,
• The council voted unanimously to grant a taxi franchise to On Tyme Taxi & Courier Service of San Marcos, a relatively new transportation service provider.
• I learned from the city attorneys after the meeting had adjourned that former Kyle police Sgt. Jesse Espinoza has dropped his federal lawsuit against the city, that the city has hired a new examiner to preside over Espinoza’s appeal of disciplinary actions taken against him and that now it’s just a matter of establishing a date on which those hearings can begin.