(Updated to include voting records for council actions. Diane Buckshnis and DJ Wilson weren’t present for the meeting, although Wilson did call in for part of the session.)
A controversy brewing over construction costs for the Haines Wharf Park project in North Edmonds was the focal point of the Edmonds City Council meeting Tuesday, as questions were raised about why former Edmonds Mayor Gary Haakenson approved $725,000 in change orders without running the contracts by the Council first.
Public Works Director Phil Williams publicly apologized to the council for what he described as “mistakes of communication” throughout the project, which began in December 2009 and was completed in September 2010, shortly after Williams was hired by the city. In fact, both Williams and current Mayor Mike Cooper said they learned of the change order issue shortly after they started working for the City. (Cooper was appointed by the council to take over as Mayor in July 2010 following Haakenson’s resignation to become Deputy Snohomish County Executive.)
City policy limits the mayor to signing construction contracts up to $100,000 without Council approval, City Attorney Jeff Taraday told the Council Tuesday night. While the policy doesn’t specifically address change orders, “my opinion is, once you are over that $100,000 threshold, any change order on that contract would need to come back to city council,” he said. You can read a related memo to the council written by Taraday and fellow City Attorney Sharon Cates here.
According to Williams, the records indicate that the change orders stemmed from a host of construction-related difficulties at the Haines Wharf site, located at 162nd Street Southwest and 76th Avenue West, including poor soil conditions that weren’t evident until construction began. “That led to a great many of the problems we ran into financially,” Williams said. Some examples of the work required in the 10 change orders: stabilizing a hillside to control a slide, providing additional erosion protection, and exporting “unsuitable material” from the park during several phases of the project.
While $163,000 was set aside in a contingency fund for the project, that reserve was exhausted by March 2010, after the fifth change order, Williams said. The city still has an outstanding issue with the contractor, Precision Earthworks, which is negotiating for an additional $700,000 “equitable adjustment” related to the completed work.
Williams shared a draft city policy designed to improve the communication process when involving the council in change orders on future City capital projects. “I can promise you that we are going to do better on future projects,” he said. “The truth is, all projects do not go well. Haines Wharf Park did not go well. It was a very difficult project.”
For his part, Cooper said that he was “disappointed that we would put forward change orders that were…outside of the scope of the $100,000 limit. I can assure you, the administrative policy of this mayor is to bring back change orders to council until we get those resolved.”
The mayor also pledged transparency to taxpayers on future projects. “When projects go wrong, we owe it to the public to tell the that they are going wrong,” Cooper said.
In addition, the mayor said he would contact officials from the State Auditor’s Office Wednesday to determine if they were looking at the Haines Wharf project as part of their annual city audit, which is nearly complete. If not, he will ask them to do so, he said.
Councilmembers, who first learned of the change orders during an executive session in July 2010, expressed a range of concerns following Williams’ presentation and Taraday’s analysis. Adrienne Fraley-Monillas noted it was likely that the council would have approved the change orders if they had seen them; Councilmember DJ Wilson, calling by speaker phone from California where he was vacationing with his family, asked Taraday pointedly “what’s the difference between not following the law and breaking the law?” Wilson then suggested that the council consider hiring an outside investigator with experience reviewing financial conduct by public officials, such as the King County Prosecuting Attorney or the Attorney General, adding that he isn’t sure the state auditor is the appropriate investigative body for this issue. And Councilmember Michael Plunkett asked Council President Strom Peterson to schedule an executive session to talk about what additional action the council might want to take.
My Edmonds News contacted Haakenson via email Tuesday night and he offered the following statement: “After looking at the agenda memo spreadsheet it appears that there were three change orders over $100,000. I wasn’t aware until tonight that there was a guideline on when change orders needed Council approval. I would have assumed that once all three change orders were approved by the City Attorney that it was within my authority to sign them. I haven’t yet seen the actual change orders that show my signature but if I exceeded my signing authority, I apologize to the Council and to the citizens of Edmonds.”
In other business, the council:
– Thanked student representative Peter Gibson for his year of service on the council. Gibson, who just graduated from Edmonds-Woodway High School, is attending Everett Community College in the fall.
– Approved unanimously one Planning Board-generated amendment, requiring a 45-foot designated street front/commercial depth requirement, to the city’s Downtown Business (BD) zones but rejected another one (3-2 Plunkett, Fraley-Monillas, Lora Petso against and Peterson and Bernheim for) that would have excluded offices from ground floor retail space in the core business zones.
– Agreed by a 4-1 vote to advance $70,000 from the City’s Real Estate Excise Tax (REET) fund to begin construction of small courtyard area in front of Old Milltown at 5th and Dayton. (Plunkett, Steve Bernheim, Fraley-Monillas and Petso voted in favor while Peterson voted against, stating he didn’t want to commit REET money in advance and would rather wait until the city had grant money in hand.) The design was revised to include child-friendly elements, including a stage for performances, to address the concerns expressed by Councilmember DJ Wilson that the area didn’t have enough amenities for families with young children. The City plans to seek grant funding and donations from private donors to pay back the REET money.