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Wednesday, May 27, 2015

Cost Overrun Workshop Reveals Cure is Worse than the Disease

From March 25th:

Washington County Government is doing well overall, thanks in large part to the dedicated staff on the front line who come in day in and day out working hard like the rest of us. The streets are plowed, the parks are clean, the libraries are stocked, the jail is secure, public welfare is delivered, on and on we have a great crew working for us. For the most part the same is true as you move up the chain of command to management and leadership of these departments. However, there's an unfortunate oversight that's allowed things to get out of hand in the area of spending of our County tax dollars.

We've been calling for something to be done for the last two years about this problem. It's contributed to the County debt tripling in the period of seven years! Through debt restructuring and some can kicking tax payers have largely avoided the pain of a massive tax increase that usually results from steep spending increases like this. Much like federal debt today. 

However, thanks to your efforts it appears we don't have  to have to wait for the inevitable collapse of the dollar that will one day come at the federal level. You have called and e-mailed your county commissioners and voiced your concerns. On March 17th the County held a workshop to offer the solution to correct the problem of cost overruns. 

Almost weekly we point out either a road or building project that is getting the rubber stamp of approval for "change orders" (see 'Photos' on WCW main fb page). Or as we wrote a couple weeks ago about the cost of the Public Works North Shop reconstruction project increased by up to $3 million dollars AFTER the budget was passed. We as tax payers still don't have any details about the project as to why this happened. The board didn't talk about this project at the workshop. They centered on contractors being at fault for asking for increases... which I'd argue naturally occurs when they realize they get away with requests without being questioned. In two years of following nearly every county board meeting we have not seen one cost overrun request denied or even negotiated down.

Not only that they left out DOZENS of contract overruns in their audit of themselves, blaming contractors. Claiming to have gone back four years they supposedly found the worst contract change orders totaling tens of thousands... we looked back just seven months into 2014  and found far worse cases that never made the list totaling MILLIONS! (see pictures retrieved from our own timeline)
-May 2014 a 30% increase to put an AC unit on the County Sheriff's Office 
-October 2014 25% increase ($274K) to extend to Hardwood Creek Trail in Forest Lake

Due to the County Board's inability to identify their rubber stamp as the culprit of out of control spending naturally the solution was going to be a disaster. True to form, the March 17th workshop has revealed the cure is worse than the disease. 

Part of the County's solution includes idea such as: 
1.) "Less public involvement"; 
2.) Change policy to only require a board vote on changes of $100K or more instead of $50K or more; 
3.) Have larger contingency funds aka: ' over estimate the project cost and report manufactured cost under-runs' 
4.) "limit alternative designs" (likely leaving the expensive option along side a bare bones approach... bad); 

Worst of all is Commissioner Kriesel's comment in the meeting stating "the last thing we want to do is spook you guys" when he was speaking to Don Theisen (director of Public Works), Wayne Sandberg (Deputy Director of Public Works), and Cory Slagle (Transportation Manager). Excuse me? Are you representing the tax payers or basically admitting this workshop was lip service?

On that note, credit should be given to Cory Slagle who was at the meeting. He has done his job well on the side of public relations. When there's a roadway improvement project he oversees he does a great job hosting open houses to listen to the public; releasing updates as they happen not only on a dedicated County web site, but also in detailed presentations to the board. Slagle also publishes itemized costs for the projects so we know exactly how much each item costs. If it's not listed you can shoot him an e-mail and he's happy to respond.

ie: how much is one single light pole for the over $6,000,000 project to update just 3/4 of a mile of CR 21 in Afton? A: About $6,000 to $9,000 per light pole

Details like this are something we could only dream of from Don Theisen who is heading up the Public Works North Shop rebuild; or Jan Lucke who's managing the planning of the Bus Transit corridors in the county where we have no data on how the seemingly random and various cost estimates for the corridor are calculated. 

In December the corridor cost $400 million
In January the Met Council released the Corridor will cost at least $460 million

It's time for for the County Board to start representing the tax payers that elected them. When a project manager like Theisen comes to the board with information that the approved budget of $17.5 mil for the North Shop is not enough we don't need "we trust your judgement"... Tax payers need a strong advocate, that's why we elected you.

Contact your county commissioners to demand better oversight: 651-430-6211 651-738-2425 651-430-6213 651-430-6215 651-430-6214