Friday, December 21, 2007

Part II: Another interesting Startribune article

This is the second in a three part series on the mainstream media's previous coverage of the problems at MnDOT.

Recall yesterday's work on then Commissioner Elwyn Tinklenberg's struggles to adhere to a competitive bid process and Governor Pawlenty and Carol Molnau's collective failure to adhere to their campaign promises of straightening out MnDOT.

In January 2003, the Startribune had a three day series on the problems at MnDOT, with 5 stories covering the problems within the powerful state agency.

To be completely clear, these stories are not an indictment of the rank and file MnDOT worker, those that work through the sweltering summers and the bitter cold winters ensuring that Minnesota's roads are maintained.

These stories show the corruption and backroom deals that MnDOT leadership made status quo for the organization.

The January 20, 2003 Startribune had two articles highlighting problems at MnDOT.

"INSIDE MnDOT; Allegations about MnDOT were kept quiet; Lawyer had drawn up document on contracting practices."

Top officials responsible for overseeing state contracts and access to public records tried to keep some allegations against the Minnesota Department of Transportation from public view.

After the federal government criticized a light-rail contract in early 2000, the state Department of Administration commissioned a review of MnDOT's consulting contracts. Don Lewis, a lawyer in the Minneapolis firm of Halleland Lewis Nilan Sipkins & Johnson, produced a summary report and a list of 45 allegations from MnDOT and Administration employees.

They included:
- Poor contract management that led to statute violations.
- Excessive use of contracts issued without competition or justification.
- Allowing contracts to grow beyond their original scope.
- Improper influence by contractors.
- Contractor overcharges.
- Failure to meet hiring goals for firms owned by women and minority members.

In essence, it paints a picture of corruption within MnDOT. Not only did they pursue the use of non competitive contracts, but they sought to keep the public from knowing about the contracts.

Call me naive, but that sure feels corrupt to me. After all, if everything is and "open and honest" process, why the need to keep it from the public?

The Strib story indicates that the report did not find a conflict of interest or a kickback, but did state that the agency failed to follow state laws in the contracting process.

Also keep in mind that the stories were completed in 2003. Since then, Tinklenberg has ran two Congressional races. In 06, he received campaign money from several individuals of a company that was quoted in the 03 Strib series as receiving a non-competitive bid contract.

The second Startribune story of January 20, 2003 highlighted the battles between MnDOT and the Department of Administration.

"INSIDE MnDOT; Watchdogs or nitpickers? Two agencies fight it out; The Transportation and Administration departments have a history of feuding over the final say on outside contracts."

By 2001, the strain of a $675 million light-rail project and a special $459 million road and bridge program pushed the departments to the breaking point. So David Fisher, then administration commissioner, and Elwyn Tinklenberg, then transportation commissioner, worked out their own solution to expedite contracts, which Fisher referred to in a document as the Big Fix.

Among other things, two MnDOT employees were given authority to bypass Administration regulators on most contracts, and a fast-track review process was begun.

At about the same time as those issues were being worked out, Tinklenberg agreed to contribute part of the money MnDOT collects from leasing space on radio towers along state highways to a new technology enterprise fund administered by Fisher.

Quid pro quo at it's best!

Leaders at the top of organizations set the standards for how these groups act. Strong moral leaders set standards that bind the actions of the leaders with the work of the "rank and file" worker, creating organizations with great synergy.

Organizations that lack strong moral leaders are often writ with waste, fraud and abuse issues and people who, behind the scenes, chronically complain. It's clear from the Startribune stories that MnDOT lacked strong moral leadership.

Working to ensure that our states roads are maintained is a daunting task. Being a steward of taxpayer money cannot be sacrificed while doing this. Checks and balances are in place for a reason!

So while the Administration Department had the final responsibility to approve state contracts, MnDOT labeled the Admin folks as "rule bound nitpickers who don't understand the real-world measures needed to get roads, bridges and rail lines built."

Checks and balances folks, checks and balances...

Nonetheless, Kent Allin, an assistant administration commissioner who oversaw the department's contract regulators, warned Fisher of possible trouble on the $3.2 million contract for preliminary design work on light rail. The Minneapolis engineering firm BRW Inc. (now owned by URS Corp. of San Francisco) had the contract; the New York firm Parsons Brinckerhoff Quade & Douglas was a subcontractor.

MnDOT wanted Administration to approve two large amendments that would change the nature of the original contract with BRW and increase its cost ceiling by nearly 75 percent. Such dramatic changes generally require competitive proposals to ensure that taxpayers get the best deal.

But Fisher told his staff that he wanted to get the contract "on the ground ASAP." Noting that Tinklenberg had personally asked him to approve the amendments, he ordered it done.

In an e-mail to his staff, Allin described the situation as a mess: "Supplement #1 is for $900K. The work has been largely completed without the amendment ever being executed. That's a clear violation of state law and something we try hard to avoid."

Allin told his staff that "given the massive water already over the dam," they would need to document the facts leading up to the situation so the department could justify signing the amendment.

Administration also agreed to expedite the second amendment, worth $1.5 million, though it considered the work beyond the scope of the original contract.

Seems both Tinklenberg and Allin are culpable in the contract misdeeds of MnDOT.

So why are these public watchdogs important?

In 1999, they stopped the department from sidestepping a pending competitive bidding process to give a $32 million light-rail management contract directly to Parsons Brinckerhoff.

MnDOT advertised for proposals, but before the responses were due, MnDOT officials privately had asked Parsons Brinckerhoff to submit a proposal for what what was initially estimated to be a $20 million job.

Parsons Brinckerhoff bid on the project and won, sparking allegations of a conflict of interest. Federal authorities said the process appeared tainted, and they ordered the state to redo it.

MnDOT scaled back the job, which was won by O'Brien Kreitzberg (now owned by URS) with a bid of $15.4 million. Parsons Brinckerhoff didn't submit a new bid.

$32 million, for an estimated $20 million job, that actually was bid at $15.4 million? Does anyone else see that as problematic?

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