Embassy Streetscape over by $37,000+


The FAIR Committee met yesterday in the Conference Room at City Hall. Some items of interest were:

* Assistant City Manager Mark Warren reported that after numerous attempts to follow up a previous recommendation from the North Carolina Department of Energy to renegotiate the cost of powering streetlights, a new employee informed him that he was not aware of any way of renegotiating the cost. Warren informed the committee that the Department of Energy employee had recommended researching published Progress Energy rates against actual charges to see if any savings could be realized.

The department also suggested talking with the county representative of Progress Energy about the possibility of lowering wattages in some areas, thus reducing expenses.

There was also a discussion of switching from sodium vapor lamps to mercury vapor lamps for a small savings.

Frazier indicated that he did not know if there was a lot of savings by switching to mercury vapor in the long run.

Henderson City Council member Elissa Yount expressed the concern that the cost of the street lights is “exorbitant”. City Manager Jerry Moss indicating that the price runs between $21,000 and $22,000 a month.

Yount stated that all city traffic signals could be taken down and replaced with stop signs for a savings to the city. It was decided to refer that issue to the Public Works Committee.

* A budget amendment in the amount of $158,146 was approved for presentation to the council for debt service to the Army Corps of Engineers for the water storage contract.

* City Engineer Frank Frazier reported on the Embassy Streetscape Project. He told the committee that the project was not allowed to start until November of 2004 and did not finish until February of 2006. Part of the delay was due to library construction.

As to the cost overrun, Frazier stated that the “worst case scenario” was not estimated, but that was what was encountered.

Frazier’s summary is available here.

There was some discussion between Yount and Frazier as to the timeline the contractor should have been held. Yount argued for liquidated damaged because the work was not completed for eight months, while Frazier countered that the work took eight months to complete because the city would not allow some aspects of the work to begin until December of 2005.

Frazier informed the committee that the timing of the project was also dictated by the grant money that was received.

Yount asked how much money for administration the city had received. Frazier replied that the city had received no money for administration and that the money had been paid to Raleigh.

“We contributed your services for the entire length of this project to that project,” Yount commented.

FAIR Committee Chair Lynn Harper asked if the problem would have existed if Frazier had waited until the library was complete to re-do the streets. Frazier agreed.

“Was the timing of the grant incorrect?” Harper asked.

Frazier replied that both were done simultaneously. He also commented that he did not see what damage had been caused by the delay.

Harper admitted that she was under the impression that the overage was due to the delay. Frazier explained that the overage was due to other causes, mainly the cutting of existing pavement that was done on Wyche Street.

Moss stated that both the city and the contractor had, in his opinion, done what they had been asked to do. He further stated that he did not see how the city had been harmed. Moss said that according to City Attorney John Zollicoffer, the city has to have been harmed in some way to assess damages.

Harper stated that the harm was the $37,791.

Harper and Yount preferred to add the $80,000 contingency to the overage, claiming a total overage of $117,791.

Frazier indicated that if the contingency was not spent on the project, it would have gone back to where it came from, presumably a grant acquired specifically for this project. It would not have been allowed to go to the general fund.

* Moss introduced a preliminary fund balance policy for the consideration of the committee.

* The committee agreed to endorse hiring a consultant to negotiate a cable franchise agreement for approximately $16,000. There is some pressure to resolve the issue of the contract quickly, as the State Assembly in Raleigh is considering a bill taking away right-of-way payments to municipalities by cable companies for use of lines.