City Council questions former Mayor’s OK of park change orders

(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.

  1. Wait a minute! We have roads that need to be repaired and the Counsel decides to invest 70K for the postage sized stamp “park” in front of Old Milltown. The Counsel talks about being fiscally conservative but, then takes money needed to maintain the City in hopes that a bonus will show up so that it can pay itself back? We are talking about nickle and diming our labor but we have 70K to pull out of out arse for a postage stamp sized plot?!

    Even more concerning: There are Counsel members who indicate that our accounting system is not accurate. We have spent a year, at least, arguing about which number goes in what column. Basically, those Counsel members have told us, over and over, we don’t know how much is in our checking account. But, then vote to write a huge check?!

    You gotta shake your head and laugh. Now it is time for me to go back to my 14 hour work day so that I can make money to pay taxes to the City. And, Counsel, let me point out that it is a really sad state of affairs when you have pissed off a die hard Democrat so much that she is upset about paying taxes. Good luck getting those levies passed.

  2. This was a high risk public work project from the start. Building a cliff-hugging park was a challenge in the best of times, and herein lies the bigger problem. While every neighborhood would love a park, this one should have been a ‘no’ from the start. So that it cost more due to certain challenges is no surprise, and should have been reason to not build at all. The change requests reflect the high risk and it all was compounded by the mishandling of the administrative process. Hopefully some lessons were learned.

  3. I am curious about the council’s response to D.J. Wilson’s suggestion 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.

    Has an executive session been scheduled per Michael Plunkett’s request?

    I plan on watching the City Council meeting on television as soon as possible and I hope many Edmond’s citizens will also take the time to do so. Per the City’s website, Full Council meetings are rebroadcast daily on Comcast channel 21 and
    Verizon channel 39.

    Time: Noon, and 7 p.m.

      1. Councilmember Plunkett, who requested the executive session, asked me to post this note:
        “I have come to no conclusion as to if there should be an investigation on the approximately $700,000 over-run payments. My intent for asking for an executive session is to hear more from our attorney. Only after full and fair deliberation will I come to a conclusion as to if the City of Edmonds should seek an outside investigation.”

  4. All of the proposed chages regarding change orders are aimed at improving transparency and council oversight; very good objectives. However, nothing was proposed, nor were there any questions asked, about reducing the number of change orders. This park project should serve as a case study to determine what should be done better on the front end to more accurately scope projects. It’s interesting that the original bid at about $2.3 million was not accepted, but has turned out to be much closer to the actual cost.

  5. I think parks are important, especially in a high visibility area like Old Mill Town. Leaving a forlorn spot in the middle of town is not good for the economy of downtown. The $70,000 from the REET fund is a good choice. The REET (Real Estate Excise Tax) money has been designated for parks. It is a 1.78% tax on the selling of real estate that the seller pays.
    Understanding the revenue sources for Edmonds is complex. I salute those who try to make it clearer.

  6. Thanks Teresa.

    Also, I’d like to applaud Peter Gibson for his diligence and hard work as the Student Representative to the City Council over the past year. Peter is a great young man who cares deeply about Edmonds. I hope his representation on the Council will inspire other young adults to be actively involved in our community.

  7. The financial discussions are all interesting… but what grabbed my attention was that three Council members rejected a “Planning Board Proposal” to require the 1st floor, street-front of the Downtown business core to be retail or restaurant. That is, no more financial services, insurance, or real-estate offices on the street fronts Downtown.

    This proposition is a key element of the joint Planning Board – Economic Development Commission plan to create the “critical density” of retail downtown in order to increase business, and thus to benefit all citizens through having a more vibrant Downtown, and tax dollars to support our City. And to draw more visitors. And to draw more potential residents who fall in love with our City. Which would make our City government budget more balanced for the long run as well.

    Of the three “no” voters, none of them had arguments that indicated that they understood the background, the process, or the vision for Downtown. They clearly stand in the way of any progress in making our Downtown once again a vibrant and viable retail core.

    If we want to keep our Downtown quaint and small (which I do!), that means we don’t want tall office/retail buildings there. Agreed. But, then we have to increase the density of retail by another means if the Downtown is to survive. If we do not, we will be left with the patchwork of businesses that we have, which does NOT support itself well in this economy. (A big THANK YOU to those who shop Downtown, by the way)

    The Planning Board/CEDC solution is to keep the finance, insurance and real-estate offices, but get them off of the street front so that we can increase retail traffic by making all store-fronts retail or restaurants.

    I am tired of the “No, you can’t do that… and no, I don’t have another suggestion… I’m just saying no.” votes at Council lately. There are teams of volunteers working their tails off trying to improve this City, but the Council seems to just wave all of the work away, as if they know better. Guess what… they don’t. They offer no alternative ideas that could be scrutinized, they just exercise their power.

    But they sure were quick to shell out $70k they didn’t have, for a “park” in front of a mostly vacant building. Brilliant.

  8. Jim and Ron W, I think you nailed this one. I would like to ask each councilmember who voted for Haines Wharf Park two questions:

    (1) Would you have voted for it if you knew how much it was going to cost?
    (2) If not, why didn’t you know how much it was going to cost?

    It is well known that the cliffs above the BNSF tracks regularly fall down. Why didn’t the city do adequate geological/soil study before developing one of them?

    I think North Edmonds was long overdue for a park, but surely a better site could have been found.

  9. I have a question for somebody who might know more about this. In reviewing Phil William’s spreadsheet attached to last night’s City Council agenda, I note a reference to a request for ‘Equitable Adjustments” equal to $701,964. Does anybody know if this relates directly to the Change Orders or if the request is in addition to the approximate $725,000 spent on change orders?

    Assuming the request for ‘Equitable Adjustments” equal to $701,964 is in addition to the change orders, we may be discussing over $1.4 million.

    Can anybody explain requests for ‘Equitable Adjustments” and comment on how often they are approved? Are they typically fought by the City? Are they negotiated down?

  10. Ken:

    All that I know is that the $701,964 is in addition to the $725,000.

    There was also some comments that the 10% contigency language was unclear as to if it really applied; the conclusion was that it did apply. When I was on the council I recall that all contracts that we were asked to approve always had a contingency fee.

  11. Todd, I totally agree with you, that we have a least 3 if not more council members who find it easier to say no than to study the issues and either agree or come up with an alternative. It is hard as a retail shop owner to reinvest in my store when I am not sure the council knows what it takes to revitalize downtown and make it a profitable enviroment

  12. Sorry, I could not phone in last night but I was out of phone range. This article is not entirely correct as I personally started asking the administration in March 2010 when I heard the project was running awry.

    No response was received despite my numerous attempts to various administration personnel.

    Our Financial Ordinance which I authored included items such as this had to go through the Finance Committee as by mid-year, the admendment had already reflected the exposure. Both mid-year and year-end financial amendments were not specific enough to provide the detail I was asking for and so I continued to ask. In fact the year-end amendment actually lunped Haines Wharf with the Inter-Urban Trail. I asked for clarification from the former finance director who by then was NOT showing up to Finance meetings and never received a response.

    All individuals that I asked (Haakenson, Hines, McIntosh, Miller) have now left and we have this mess to clean up.

    I will continue to ask the tough questions so that the citizen of Edmonds understand that I am fighting for them to show that their money is being spent wisely.

    Also, thanks to the new adminstration for their willingness to show us the details and not stonewall.

    When I get home I will work with the attorney and Council as I have all the amendments and some docs. I can’t recall if all Finance Minutes were detailed enough…but will work on this when I get home.


  13. I don’t know if ‘tough questions’ are the long-term solution v. using common sense on public projects. Again, this is one that should not have happened for obvious reasons, i.e., the cliff.

  14. Thanks for the information Ron.

    Are Equitable Adjustments common on projects this size? This seems like a very high percentage of the final bid amount.

  15. Jim, of course, is right. When $1.5 million had already been spent it’s almost certain that approving amendments is essentially a rubber stamp.The “tough questions” need to be asked before the original project is approved.

    And, of course, the new administration is more than willing to cooperate as the only axe they have to grind in this issue is political. Anyone who doubts that should read Kimberly Cole’s (Mayor cooper’s lifetime assistant) Facebook page.

  16. Ken:

    I haven’t heard of Equitable Adjustments, but they may be fairly common. It does seem like a very high percentage. Perhaps the contractor is posturing to get one-half that amount.

  17. Equitable Adjustments sounds like a smoke screen term. Something Scott Snyder and Odgen Murphy Wallace Law Firm would invent to cover up their misdeeds.

    Under what authority did OMW approve the cost overruns of $725,000. The name of actual Attorney that approved the checks. And of course the amount of the law firm’s Professional Liability Insurance.

  18. I just watched a portion of last evening’s City Council meeting and highly recommend viewing it if possible.

    I am trying to calculate the total costs for this project, to the best of my ability.

    Design Phase – $347, 320

    Right of Way Acquisition – $40,000

    Project Bid – $1,634,668

    Change Orders covered by 10 percent contingency fund – $163, 467

    Change Orders exceeding 10 percent contingency fund – $560,633

    Total external project costs before Equitable Adjustments – $2,746,088

    This amount does not include internal costs – I imagine City staff incurred significant expenses on a project this size. Phil Williams also mentioned Soils Testing, which may or may not be included in the figures discussed above.

    I am most concerned about the Change Orders exceeding the 10% contingency fund which appear to be equal to $560,633. Who had the authority to approve the expenditures exceeding the contingency fund?

    Next we have the Equitable Adjustments equal to $701,964. I believe this is in addition to the $2,746,088. If I heard him correctly, I believe Phil Williams said the Equitable Adjustments may lead to a claim against the City. If so, and if the Claimant is successful…..that pushes the project cost up to well over $3 million.

    I am not positive I have all the information or that I have added it up properly. Hopefully my calculations are somewhat accurate.

  19. Hi Jim,
    No dispute from me about this park should have never happened. Look across the road at all the retaining walls and one can see there would have been problems. It happened and was approved before I came along and we will determine if the administration tried to bury it as I am on record for asking about it. So yes, had I not asked the tough questions….this may not have come to light.

    Meadowdale is less than a mile away and that is a great park by the way.


  20. Please, Ms. Buckshnis, you weren’t even at the meeting. And now you’re taking credit for this? Looks to me that Mayor Cooper brought this to light, and deserves a lot of credit for raising this issue in a challenging budget and election climate. It looks like from the documentation that action on this started after Mr. Haakenson left, not when you got on Council. I’m not saying you didn’t do your job, but reading your comments here alone would lead one to think that you were the cause of all that is good and holy in Edmonds. I don’t post here much – I think this is my first time – and I won’t be doing it in the future. But, jeez, Ms, Buckshnis, I’m sure you’re not the only person that has been asking “tough questions.”

  21. I agree that this looks like things run amuck However I am also amused about how everyone, both at the meeting and now on here are taking the “not on my watch” explanation. Old Mayor, old Public Works Director, old Parks Director. Everybody runs for cover.

    I also know that this is not new to the council. I remember Mr. Williams recapping the cost to the council a year ago. I am not sure what meeting it was at but, I do remember the numbers the same as last night. $1,600,000 budget and $2,300,000 actual costs with the difference being mainly issues with the suitability of the soil and slope issues.

    He did not specifically mention the change orders as an issue at that time, but more the cost differential. As he was new I am sure it never even occurred to him about the signing authority on the change orders. Why wasn’t this addressed at that time!

    I am also fairly certain that despite the enormity of the cost overruns the council would have approved them had they been presented with them. They are already into the project for over $1.6 million are you now going to abandon it? Sometimes projects just go badly as Phil Williams mentioned.

    I agree with Adrienne Fraley-Monillas’ point that, it might be too late to do anything about this, they probably would have been approved anyway, but what is important is to put into place procedures that prevent this from happening again. And to tell the truth I hardly ever agree with her so for me this is a breakthrough in my thoughts..

    Unfortunately, I think a lot of the ruckus here is politically motivated. Odd that this has sat around for a year, but now, right before the election, everyone is grandstanding about what went wrong. It is unfortunate and makes me sad that I have this skeptical view of Edmonds politics, but it is how I see it.

    Again, I am not condoning what happened, but I just find it distasteful that everyone has chosen now as the time to start throwing people under the bus!

    A further note on the meeting and one that plays directly into the hands of anti-Levy arguments is what happened regarding the Old Milltown park. We only have appropriated $40,000 to fix up the park, but that’s OK we’ll just use up our REET funds, which are already in short supply, to fund the difference and the hope that grants we will apply for might come through to replenish REET. No mention of what might happen if the grants don’t come through. No thought given as to whether or not it might reduce the chance of getting a grant when the grantor sees that the City has already funded the project. This is the kind of financial irresponsibility that will give the voters pause to think, “can I really trust these people to make good use of additional money, when they don’t watch over the money we already have.”

  22. I believed the decision to acquire the open space at Old Milltown was a good one, and am relatively certain that the plan was to maintain it “as is”. I also believe the Old Milltown park improvement money is well spent, and support the decision by Council to take the most timely route to completing this well-designed project. Every time I pass Old Milltown and see the totally unimproved and unmaintained open space, which has been that way for 2-3 years, I cringe. I will personally contribute to a fund to replenish REET, and will encourage others in town and organizations I am involved with to do the same. I challenge those of you who are able to do so to contact the Parks Director, Carrie Hite, and find out how you can make a donation too. For Edmonds to “go on hold” on this project would have been, in my opinion, a huge mistake. The mistake would have been to pass up an opportunity to create a desirable gathering place for folks as they wander through downtown looking for places to visit, eat and shop.

  23.   I fought to expose city financial mismanagement on this project back March. In fact they tried to bury it in both ammendments.

    We must rekindle public trust.  I wrote new financial policies that will lead to more open government.

    We must restore straight talk so citizens can see how their money is spent.

  24. Harry, I agree with your comments in # 23 , I believe it is about 60% politacal as to timing. Why not waite till the investigation is over before we throw people under the bus for politcal reasons. I am sure there will be more to come . I hope the council doesnt become just a big campaign band wagon for incumbents

  25. Diane:

    Too bad that you did no fighting, or asked no “tough questions”, about the cuts in compensation of Edmonds city workers compared to other government workers.There’s lots of anecdotes about cuts at the county, at the state, etc.but nobody, including you -one who claims to ask the “tough questions” – would pursue the benchmarking that I repeatedly suggested.

  26. Harry, I think you and others have made the mistake of assuming that City Council was faced with the choice of either approving the overruns or abandoning the project. It would have been valuable to see if there were other alternatives from Council or citizens. Maybe we could have found less expensive ways to fix the problems. I don’t know this project will enough to suggest any worthwhile alternatives that might have been proposed back then, but I do think they should have had the opportunity.

    So like pretty much everyone else, I think city policy should be clarified so there’s no doubt that council must be notified in the future of significant overruns.

    Having said all that, I do agree with your conclusion that there’s nothing to be gained by vilifying the former Mayor and other officials. I don’t think the city policy was completely clear and I’m willing to give him the benefit of the doubt and assume this was an innocent mistake. Hopefully Council will reach the same conclusion when they go into executive session.

    And I also agree with many others that these problems were likely foreseeable and that more should have been done to evaluate the suitability of the site before the big money was spent.

  27. I guess there is going to be more construction in the city of Edmonds and REET money will be pouring in. I like fixing up the park at Old Milltown, whoops I can’t say that because Old Milltown doesn’t exist, so okay the small park on 5th Ave. but wouldn’t it be prudent to wait until the grants are secured? What is the eyesore is the empty space under the empty space of the old Ace Hardware. I liked the plans where there is seating for a restaurant in front of the barber shop. Who says there will be a restaurant there since 3 council members said they would like a nice service business to be located there or anything the landlord wants to put in that spot. I agree with Todd on this one.

    On transparency Diane, would you go into the city web site and change the statement on your Bio about being the treasure of the Edmonds Rotary for 2010. I think someone else that position. Makes me wonder if there might be some other embellishments in the rest of it.

  28. Ron, or anybody else who might know…..can you explain the relationship between change orders and a contingency fee? If a City contract stipulated a contingency fee of 10% for example, wouldn’t the change orders be limited to 10% of the contract’s original bid amount?

    Have you ever seen a contract that simply allowed an unspecified contingency amount that would allow for unlimited Change Orders to be paid without Council approval?

    In addition, I reviewed several months worth of City Voucher reports provided the Council for their approval. My goal was to try and determine if the payments to the contractor indicated how much was related to the original bid and how much was related to change orders. I found the following three payments and noted no details related to original bid/change orders:

    March 25, 2010 – $248,383.92 (Voucher 117953 related to payment #7)
    April 22, 2010 – $239,444.95 (Voucher 118532 related to payment #8)
    June 10, 2010 – $234,070.17 (Voucher 119476 related to payment #9)

    Without detailed information, how are Council members to know if these payments all relate to the original bid or if a portion of the amount relates to change orders? Do Council members get more detailed disbursement information in their packets, or just the Voucher Payment list attached to most City Council Meeting Agenda’s?

  29. @Joe
    Look at later minutes and you will see she declined. I joined in 2010 and Diane wasn’t the treasure.

  30. Another question I have is did the amount spent exceed the Council approved budgeted amount for this project? The timeline provided by Phil Williams represents that 4 bids were submitted in mid 2008, the low bid was $2,332,905 and that the bids were rejected because they exceeded the budget.

    I do not know the actual original budgeted amount related to this project or if it was ever changed. The original bid amount of $1,634,668 plus the Change order total of $724,100 equals $2,358,768. This amount exceeds the low bid amount that was rejected in 2008 because that bid exceeded the budget. It is possible the budget was increased on this project…..does anybody know the history and/or the details of the budget on this project? What are the ramifications if the budget was exceeded without Council approval?

    Furthermore, we have the $701.964 Equitable Adjustments still to deal with. How do Equitable Adjustments relate to the budgeted amount for the project?

  31. You’re right, Paul. Her campaign website makes no such claim. Perhaps Diane can explain how this mistake got into the city website.

    Of course the city website also advises visitors that they can buy hardware downtown, so I don’t had much faith in what I read there. 🙂

  32. It just occurred to me there’s a simple explanation for how the biography mistake happened. She probably submitted this information when she applied for the vacant council position. This would have been after she was picked to be the Rotary treasurer in November 2009, so the information would have been correct at that time. She was appointed to council in January 2010 and because of that appointment decided to decline the Rotary position. Nobody corrected the forgotten entry in the biography.

  33. Joe, You are correct. When I get home I will change it. It is hard managing work from my blackberry while on vacation. Paul, I practice the four way test … I am surprised you would even consider that I would be dishonorable, especially when discussing my prolific career where you could contact any of my LINKEDIN contacts and receive commentary about my researching and educating style.

  34. The Following Narrative is found on the City Council Agenda for the May 5, 2009 City Council Meeting:

    On April 21, 2009, the City received nine bids for the second re-bid of the 76th Avenue West/75th Place West Walkway and 162nd Street SW Park project. The bids ranged from a low of $1,634,667.54 to a high of $3,107,322.06. The Engineer’s estimate was $2,003,431.80. The low bid was received from Precision Earthworks, Inc. and a review of their bid documents and records was satisfactory. The bid tabulation is provided as Attachment 1. Below is a summary of the estimated construction budget for the project.

    Construction Budget:
    Contract Award $1,634,668

    Inspection/Construction Management $75,000

    Material Testing $46,000

    1% Public Art $16,347

    Contingency (10%) $163,460

    Total $1,935,475

    Precision Earthworks bid was nearly $75,000 lower than the February, 2009 bid, and $376,000 lower than the June, 2008 bid of $2,011,628.15. The 2009 adopted Capital Budget contains $2,000,000 in Fund 125 for the 162nd Street Park and 76th Avenue/75th Place West Walkway project.


    Hence, it appears that the budget appropriation was $2,000,000 for the park/walkway the evening the City Council approved the contract, May 5, 2009. Also, a 10% contingency was indicated for $163,460.

    It appears that the change orders exceeded the contingency amount and that the change orders pushed the project well over the budgeted amount, unless the budget appropriation was later increased by the Council.

  35. Going forward it would be good for the Council to review all significant/risky public works projects. This would not be an opportunity to redesign and the like, but to be sure that the plan and its execution will work as described and w/o overruns. Certainly this happens w/in the various City departments, but for big ticket items, it can’t hurt to take a second look. Should avoid a lot of loud comments and arm waving later.

  36. Why would the former Mayor and Staff seek City Council authorization to sign Addendum No. 6 to the professional services agreement with Gray & Osborne, Inc. for $43,200 on March 23, 2010 and then fail to do the same for the following change orders on the same project in the same time period?

    March 23, 2010 Change Order #6 – $131,547
    April 19, 2010 Change Order #7 – $245,297
    June 8, 2010 Change Order #8 – $167,739

    The Agenda for the March 23, 2010 City Council Meeting includes the following:

    Item AM-2918

    Subject Title Authorization for Mayor to sign Addendum No. 6 to the professional services agreement with Gray & Osborne, Inc. for the 76th Avenue West/75th Place West walkway & 162nd Street SW park project. Recommendation from Mayor and Staff
    1. Council authorize the Mayor to sign Addendum No. 6 to the professional services agreement with Gray & Osborne, Inc. for the 76th Avenue West/75th Place West walkway & 162nd Street SW park project.
    Previous Council Action On May 23, 2006, Council authorized Staff to advertise for statements of qualifications for the design of the 76th Avenue West/75th Place West walkway and 162nd Street SW park project.

    On September 26, 2006, Council authorized the Mayor to sign a professional services agreement with Gray & Osborne, Inc. for design of the 76th Avenue West/75th Place West walkway and 162nd Street SW park project.
    The City contracted with Gray & Osborne in 2006 to design the 76th Avenue West/75th Place West Walkway and 162nd Street SW Park project. This addendum will provide additional engineering and project related services for the purpose of providing technical support during construction. In addition, the landscape architect firm of Susan Black & Associates (SBA) is providing support services during the construction of the new 162nd St. park. The services provided include reviewing material submittals, responding to requests for information, attending meetings with the contractor, assisting with project close-out activities and preparing as-built drawings. This improvement project and the additional services in Addendum No. 6 ($43,200) are being funded by the Parks Improvement Fund (Fund 125).

  37. An additional issue that must be addressed is whether or not any of the change orders required compliance with state laws regarding public works and competitive bidding. Did any of the change orders relate to work that was not within the original scope of the project? If so, the State Auditor may rule that the work represented a separate project and that appropriate competitive bidding procedures should have been used.

    A similar concept was addressed in Report No. 75276 issued by the State Auditor’s office dated July 9, 2008. The State Auditor reported that the City did not comply with competitive bid laws related to some of the change orders associated with a $4,332,113 contract for improvements along 220th Street. 19 change orders totaling $630,639 were approved, but the State auditor determined that 3 of the change orders were for work not within the original scope of the project. The State Auditor recommended the City comply with state laws regarding public works and competitive bidding.

  38. Ron B, commenter #2 “Its that transparency thing again”

    That’s THE point. Forget the numerous side issues in the other comments, the real problem is clearly visiible. We don’t need a layer of fog to clarify something so very obvious.

    There is no doubt whatsoever that Mr. Haakenson deliberately withheld financial information from the Council. I also believe that there was no criminal intent or benefit on his part. Rather this is just one more smallish sample of a his lousy managerial style in which anything goes and the truth is often concealed in order to accomplish a goal.

    So who does he support for Mayor? None other than the same instrumental guy he worked closely with to load us, the Edmonds citizens, with a large debt for the Arts program while avoiding putting the issue on the ballot.

    Hopefully we will have far smoother sailing with whoever becomes our new mayor!

  39. On September 4, 2007, the City Council approved Addendum Number 1 to Professional Services Agreement with Gray & Osborne, Inc. The Contract Addendum authorized a “Do Not Exceed” amount of a total of $269,600 that could be spent on Gray & Osborne’s services.

    The spreadsheet provided City Council last Tuesday night appears to indicate that the City exceeded this “Do Not Exceed” total of $269,600 on four separate occasions, when the following four payments were made without City Council action::
    Addendum 2 – $ 6,545
    Addendum 3 – $ 6,575
    Addendum 4 – $13,900
    Addendum 5 – $ 7,500

    I wonder what the ramifications are when a specific “Do Not Exceed” contract is exceeded without City Council action? These payments totaled $34,520.
    This is related to the other discussion, but I believe it is different in that there probably was no extra money available related to this contract, yet additional monies were paid on four separate occasions, without Council action.

  40. Following is an example of the former Mayor seeking Council Approval for a change order UNDER $100,000 from the May 18, 2004 City Council Meeting Minutes. The question must be asked, why would the former Mayor not have done the same for the following three change orders OVER $100,000 each:

    March 23, 2010 Change Order #6 – $131,547
    April 19, 2010 Change Order #7 – $245,297
    June 8, 2010 Change Order #8 – $167,739



    At 8:10 p.m. Mayor Haakenson recessed the Council to a 20 minute Executive Session regarding two legal matters. He advised the Council may return to regular session following Executive Session and take action. The meeting was reconvened at 8:25 p.m.



    Councilmember Dawson noted that Washington Cities Insurance Authority would reimburse the city for this cost.

    With no further business, the Council meeting was adjourned at 8:30 p.m.

    Edmonds City Council Approved Minutes
    May 18, 2004
    Page 10

  41. Following is another example of City Council approval of Change Orders and why it is so important…this is a great example of how the process is supposed to work…please note how Lora Petso asked the correct question about seeking competitive bids related to extra costs..and how Jeff Wilson was very aware of the contingency fund and how it related to this project..this is from August 26, 2003. Mayor Haakenson was in office and Scott Snyder was the City Attorney:


    Parks & Recreation Director Arvilla Ohlde advised the mid-waterfront project was progressing quickly and on schedule. She described the history of the project that included purchase of the tidelands but not the chicane bulkhead in front of Waterfront Park Associates, and the agreement they would build the bulkhead and provide the City a permanent walkway easement connecting Brackett’s Landing to the Senior Center. This portion of the project at 144 Railroad Avenue, which was held out from the original project, completed the connection to the entire waterfront. She requested the Council authorize the Mayor to sign the contract allowing completion of the waterfront bulkhead.

    Councilmember (JEFF) Wilson asked whether the $100,000 remaining as contingency represented more than 10% of the valuation of the work remaining in the final contact. Ms. Ohlde answered yes.

    (Council President Earling arrived at 8:41 p.m.)

    Councilmember Petso asked what the anticipated cost of this portion of the project had been. Ms. Ohlde answered the engineer’s estimate was $185,000 – $200,000. Councilmember Petso asked why this portion was being handled as a change order rather than being re-bid, questioning whether a change order prevented the possibility of a lower bidder and asked what were the advantages of a change order. Ms. Ohlde answered the contractor was already on site, the products were on site, and it was less disruptive than de-mobilizing one project and re-mobilizing another project. Further, it avoided the delay of de-mobilizing and re-mobilizing, possibly pushing the project into 2004. She commended the property owners in the area for their tremendous cooperation.

    Councilmember Petso concluded the advantage of the change order was to save time and it was not significantly different than the anticipated cost. Ms. Ohlde agreed.

    Councilmember Wilson asked whether this work was an alternate to the original bid. Ms. Ohlde answered no, the first phase was bid and this was a change order. She advised BOSS had been a very good contractor who had worked efficiently and with the public.


    Councilmember Wilson expressed his appreciation for the approach to this project and handling it as a change order. He agreed de-mobilizing and re-mobilizing was expensive and eliminated the potential for “finger-pointing” by contractors regarding who did what to whose project. He concluded this would allow for more quality control and keep the cost as low as possible.

    Councilmember Marin commented he had inspected the work twice and the quality of the work and the artwork on the caps were spectacular.


  42. A couple more examples of City Council Approval of much smaller Change Orders while Mayor Haakenson was in office and Scott Snyder was the City Attorney:



  43. Ken What is all this accomplishing if you feel the mayor and city attorney did some elegal acts why not pursue that avenue, other wise lets drop the personal attacks to be used for politics and move on to the tasks at hand and get the city moving forward. Election years are full of induendo , lets move on to making Edmonds a better and more vibrant city.

  44. Don….as far as I am concerned, this has nothing to do with Politics in any way. I am not the one who brought this up…it was introduced by staff and discussed at depth last City Council meeting. The Council has an executive session planned for tomorrow evening to discuss it further.

    All I have done is post information I have found via my research. IF wrongdoing took place, I believe the city has a fiduciary responsibility to the taxpayers to hold those responsible accountable for their actions.

    I’d be happy to meet with you in person and discuss my research.

    I strongly desire doing all possible to make Edmonds a better and more vibrant city….love to discuss that with you also.

  45. Ken ,Thanks for your responce, I am leaving town for a week or so. would be gla dto meet with you when I get back

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