Assembly turns down added contract oversight

Posted: Thursday, February 08, 2007

The Kenai Peninsula Borough Assembly rejected a proposed ordinance Tuesday that would have required the administration obtain assembly approval before awarding contracts over $50,000, even when expenditures for those contracts had already been authorized in the annual budget.

The ordinance covered not only contracts in excess of $50,000, but also contract modifications and change orders exceeding $50,000, or that would put a contract over $50,000. An amendment offered by Assembly member Pete Sprague, of Soldotna, simplified the language to eliminate changes and modifications.

However, when it came to a final vote on the amended ordinance, the assembly split 4-5, leaving it to the discretion of the administration whether to bring formal contract approval resolutions to the assembly.

Bringing final contract award actions back as resolutions is not a code requirement, but Sprague noted that in practice, the assembly had been presented with such resolutions in past years.

Last fall, Mayor John Williams opted generally to cease the practice in an effort to promote efficiency, and began using the “mayor’s report” agenda item to inform the assembly when approved expenditures were formalized in signed contracts. The mayor’s report is an informational item that can, and often does generate discussion, but requires no formal vote of approval or rejection.

The administration argued that the preparation of packet resolutions with all the back-up material required takes up staff time a waste of resources considering that contracts for services and goods are typically accounted for in preparing annual budgets, and that in many cases it is the assembly that gives specific directions to the administration to find and hire a contractor for one service or another.

Sprague said he believed it was in the public interest, as well as good policy, for the assembly to retain oversight, even when the dollar amounts were already approved in the budget. During a committee meeting Tuesday afternoon, however, the administration presented reasons why final contract approval by resolution was redundant and unnecessarily costly. Tuesday night, a majority of the assembly agreed, but the divisions were clear.

Assembly member Milli Martin, of Diamond Ridge, said what she liked about the past practice was the opportunity it afforded the general public to see the information contained in a bid-award resolution and better understand borough expenditures.

“I appreciate where some of the discussion got, you know, especially on efficiency, but ultimately we are responsible for the expenditures. I feel like it is something we should be doing and should be coming to us and I do miss seeing that,” Martin said.

Deb Germano, assembly member from Homer, agreed.

“I think that government and efficiency can often be an oxymoron,” she said. “We do have an obligation as public officials to follow up and make sure.”

Sometimes, she said, the mayor’s report shows details, sometimes not. “We really do need consistency,” she said. “I don’t think it is unreasonable to go the next step and present it to the assembly as it was done previously.”

Assembly member Grace Merkes, of Sterling, noted that borough department heads had expressed opposition to the measure saying it would add unnecessary work.

“They didn’t feel it would be in the best interest of the public or save any money,” she said.

Assembly member Gary Superman, of Nikiski, said he was satisfied with being reminded in the mayor’s report exactly what appropriated money was to be used for and to whom it was going.

“I used to like the bid awards (resolutions),” he said. “But I think the same effect can be accomplished through the mayor’s report, because it reminded me of our budget sessions. All those bid awards are inherent in that budget process.”

“I don’t believe we have shorted the public out of the process,” assembly President Ron Long, of Seward, said.

The assembly, he said, determines the level of spending to be applied toward a project and appropriates money. Then it gives marching orders to the administration to get the best deal, put together a contract and hire the right contractor.

“Those checks and balances between the administration, between the executive and the legislative (branches) are pretty much working,” he said.

When contract awards were regularly brought to the assembly, Long noted, they’d almost invariably be part of the consent agenda, a portion of the agenda that includes items needing no further discussion and which is approved with one vote. The general public got the same information it gets now through the mayor’s report.

“At the same time, I’m sure that this administration and future administrations, always will be politically savvy enough that when a contract award comes along that is going to be controversial, that for the sake of political coverage, they’re going to hand it over to us,” he said. “Can’t blame them for that, I suppose.”

Long said he could not recall a contract resolution ever being turned down. About the only time a contract award might be problematic would be if an administration were accused of “playing fast and loose” with the procurement process, Long said, adding that he could recall only one such incident of finger-pointing, and that one resulted in the administration’s actions being upheld.

He said he appreciated Sprague’s effort toward accountability, but said he did not think the assembly had been unaccountable. Until it was demonstrated the assembly was not living up to its obligations, he said, “I cannot justify continuing to go through the motions (of a resolution) when the outcome is basically going to be the same.”

Voting in favor of Sprague’s resolution were Sprague, Germano, Martin and assembly member Paul Fischer, of Kasilof. Assembly members, Long, Merkes, Superman, Gary Knopp, of Kalifornsky, and Margaret Gilman, of Kenai, voted no.

In other business, the assembly:

· Voted against reconsideration of the award of a contract hiring a pair of law firms to sue and lobby the state over inequitable education funding;

· Introduced Ordinance 2007-06, which would require service areas to pay for special elections out of service area funds. The measure, if passed, would not affect the South Peninsula Hospital Service Area’s special bond election scheduled for May, but would affect future service area special elections.

· Approved ballot language and summaries for the South Peninsula Hospital Service Area special election May 8. Voters will be asked to approve up to $14.7 million in general obligation bonds and a .98-mill property tax increase in support of Phase 2 of the hospital expansion project.

Hal Spence can be reached at harold.spence@peninsulaclarion.com



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