With a bit of a nod to its critics, the Morro Bay City Council agreed to hire someone to “watch the money” and take over steering the City’s sewer plant project through to fruition.
City Manager Scott Collins said the vote was unanimous to create “a new program manager position, to lead the project with the existing team.” That team consists of Michael K. Nunley & Assoc. (MKN), the engineering and project management consultants, and the City staffers in the Public Works Department.
The program manager would report directly to him, he explained. “The Council also directed the City Manager to evaluate and adjust the current contract with MKN as appropriate, given the change in overall program management leadership.”
For months now, a growing chorus of residents has asked for better accounting on the sewer project saying the spending has been too much for too little to show for it, and the project needed new management or a fresh set of eyes working on it.
Collins, who has been with the City for just 2 months, added that the council “praised the existing team and [Public Works Director] Rob Livick for their efforts and skills.”
The Council wants a new program manager to “bring skills that complement the existing team, skills like fiscal management and community outreach, and large project management experience to bear on the WRF project,” Collins said.
Collins was ready to go out for applicants for the job as soon as possible and wants to avoid delaying work on the environmental impact report or EIR, which has become a key element, after the City was pre-approved for an $82M low-interest loan from the Environmental Protection Agency.
“They did not put a timeline on the recruitment,” Collins explained, “though staff has made it a top priority, and believe the RFP process will take a few months. It is of the opinion of staff that the new hire will not disrupt the project’s timeline [with regard to permitting, federal and state loan subsidization applications, EIR, etc.].”
The City has since 2013 been working on a new project, after the Coastal Commission denied at the behest of the former-City Council the first project, slated for property on Atascadero Road.
Since then, the City has been trying to find a suitable location for its project, settling last fall on a property at the end of South Bay Boulevard near Hwy 1, this after several start-stops, as one site after another was studied and ultimately rejected.
Changes have been made to the project since a rate study came out last spring and the Council scaled it back into phases to try and cut the initial $169 million price tag, and reworked cost estimates are slated to be released soon with a new rate study.
The last estimate had it at $150M including a hefty contingency. The costs should be narrowed down, as the City gets closer to bidding a design-build contract, and a draft EIR is released to the public, slated now for April, with approval by the City Council in June.
In his staff report, Collins presented the council four basic options — maintain status quo; fire MKN and seek a new consultant; fire MKN and hire city staff to cover the duties; or hire a program manager as a sort-of liaison with the City.
That third choice — hire city staffers to cover MKN’s duties — was a doozy.
According to the staff report, “The minimum staffing for the Program Management Team, in addition to the Public Works Director/City Engineer, should consist of three licensed journey level engineers, one land use/coastal/CEQA planner, one public outreach specialist, one GIS technician/design draftsperson, one contract specialist and one clerical person. Since those needs are temporary, it is not feasible to find qualified, experienced staff to fill the many temporary positions across the many disciplines needed for project execution.
“In addition, many of the efforts require disciplines and expertise outside of the typical skill set of engineering or operations staff. Using that approach is neither practical or feasible and will result in significant project delays.”
And with the low-interest EPA loan application due in mid-July, delays, it was decided, must be avoided so as not to endanger getting that EPA money, as well as other subsidized loans.
One of the chief critics, Jeff Heller of Citizens for Affordable Living or CAL, urged the council to hire a money guy, or “owner’s agent,” someone whose role is specifically to “protect the money.”
Local attorney and City critic, Cynthia Hawley with the Morro Bay Action Team, urged the council to hire someone who knows the requirements of the California Environmental Quality Act or CEQA, adding that the City’s project is being done out of sequence, as there hasn’t even been an application made to the County for a permit (the South Bay site is outside the City Limits). She called the project a “mismanaged mess.”
Former Councilwoman Betty Winholtz said the basic problem is that the project is too expensive, not that the City needs to go after less expensive money.
Others believed MKN should flat out be fired and also worried that the City was rushing through an unacceptable project in order to get the subsidized EPA loan, which was estimated to carry about a 2.36% interest rate, versus as much as 5%-6% interest rate needed to finance the project using municipal bonds issued by the City.
By Neil Farrell