City of San Diego Misuses Water and Wastewater Funds to Pay for the City’s Subcontractor Outreach Program (SCOP)

 

By Jim Ryan AGCSD Executive Vice President

In 1999, the San Diego City Council and since then, all past and current City Councils, have forced upon the construction industry the Subcontractor Outreach Program….commonly known as the SCOP Program.  On August 7^th, the Mayor’s office released a statement that the auditing firm of Mayer Hoffman and McCann has uncovered $492,777 in Water Department and Wastewater Department funds that were transferred to the City’s general fund to cover costs of the City’s Equal Opportunity Contracting Program.  The main activity of the EOC Program is to administer the SCOP Program.  The Mayor will recommend to the City Council that the $492,777, and just over $500,000 of additional funds, be paid back to the Water and Wastewater Department. This follows over $2,000,000 in funds that were previously directed to be paid back by the City to the Water & Wastewater Departments.

 

The Water and Wastewater Departments are flush with cash since the passing of a series of water rate increases the council approved in 2003, 2004, and 2005.  The funds were supposed to be used to purchase bonds to build and repair the City’s water and wastewater infrastructure. While funds from the bonds were not transferred, apparently the departments were required to absorb added overhead that was not really part of their department…including a portion of the Equal Employment Contracting Program.

 

All of this is in addition to over $3,000,000 that the City has spent on the SCOP program by going to the second bidder on projects because the low bidder did not comply with SCOP…..

 

In my opinion the SCOP Program is a “code word” for the City to have a program that is a camouflaged minority set aside program.  In the late 1980’s and early 1990’s the City was able to require prime contractors to award from 5%-20% of all subcontracts on City projects to minority firms. The US Supreme Court made this practice illegal, and in 1993 AGC was forced to sue the City to comply with the Supreme Court ruling.  The City had decided just to ignore the Supreme Court, and in essence, award illegal contracts.  AGC easily won the case. The City basically accepted this until 1999 when they were successfully lobbied to require the SCOP Program.  This program is, on the surface, directed at all “small subcontractors” but the reality is the Council and those that enforce it see it as a way to make an end run on the US Supreme Court Ruling.

 

It has been a disaster.  Prime Contractors are required to submit multiple 3 ring binders that are 6 inches thick full of ridiculous documentation concerning outreach efforts to “small businesses.”  A large staff of city workers analyzes each and every detail that is submitted.  Especially early in the program, the low bidders were often rejected for not fulfilling the requirements of this program and the City moved to the second or third bidder….costing the City millions…..and for what…..their participation by minority firms is still very low.  The Program has been before the Council a few times…..but even though they know it is costly, wasteful, and achieves nothing they continue to move forward with it…always directing city staff and the industry to bring them a program that is better….we have tried and thanks to certain Council members have always been rejected.

 

In addition, early in the Program’s history, the SCOP and EOCP staffs were reorganized and were taken from the Engineering Department and were directed to report to Lamont Ewell….first as Assistant City Manager and later as City Manager.

 

And now we find out that the City Council and the City Manager evidently did not have the funds available to pay for all of this, so they funded this mess through the Water and Wastewater Departments.

The City Council should eliminate this wasteful program….now!!!!!

 

Mentor-Protégé Program in Full Swing / New Protégés Sought

By Brad Barnum, Vice President Government Relations

 

Last Thursday, I attended a meeting with four AGC contractors who are currently serving as mentors in the AGC/City of San Diego Mentor-Protégé Program.  The contractors meet quarterly with City staff to review the progress of the program, and I must say, I was quite impressed with the “report card”!

 

 “It’s been a joy” says Edward Wylie of C.E. Wylie Construction Co., in his one-year mentoring of Harvester Wiley of Wiley Construction, which specializes in masonry, tenant improvement, new construction, and remodels.  Wiley continues to grow and plans to get back into the U.S Small Business Administration 8a Program.

 

Dave Randal and Tom Shaddox of Hazard Construction continue to mentor Randall Thompson of Randall’s Backhoe.  “He is headed for success” commented Shaddox, noting that the company recently was selected by SDG&E to bid some of its work.

 

Marc Penick of T.B. Penick mentors In-Line Fence Company, which has been very busy with a number of public works projects.  Although Marc says the company is doing extremely well on its own, he and his Chief Financial Officer continue to work with In-Line’s David Ortiz on scheduling, cash flow, and financial forecasting issues.

 

Nigel Cary of Cox Construction, who has led the AGC’s efforts in making the program a success, has now become a mentor himself!  He is mentoring our newest protégé, Pereira Plumbing and Fire (soon to be Pereira Mechanical & Engineering), specializing in HVAC/mechanical, plumbing installation and rehabilitation.  With only three meetings so far, Nigel and Lynne Pereira have focused on the direction of the company and its financials.

 

Besides the mentors, the success of the program has to be attributed to the City’s Herb Lemmons.  He spends countless hours attending every meeting between the mentor and protégé, and leads the Mentor-Protégé Advisory Board, which serves in an advisory capacity to establish policy, solicit volunteers, and monitor the progress of the program.  Thanks Herb!

 

Nigel Cary also should be thanked for his service on the Advisory Board.  He was on the Board since “Day 1” in 2000, and did a great job to get the program off the ground…Nigel, thank you!  Unfortunately, Nigel will no longer be able to serve on the Board now that he is a mentor, but Dave Carlin of Soltek Pacific has agreed to represent the AGC.  Welcome aboard, Dave!

 

With four protégés well on their way to success, the time is now to begin a search for more protégés!  Applications are being accepted from emerging, diverse, local, and small construction companies that are willing to work hard to succeed as a contractor.  Contact BRad Barnum at 858-558-7444, ext 103 for more information.

 

The AGC Specialty Contractor’s Council Tailgate and KGB Sky Show….Saturday, September 23rd 

By Jim Ryan AGCSD EVP

 

Want to treat your employees to the best football tailgate in San Diego….a great college football game and the best fireworks show most of us have ever seen….all for $40 per ticket!!!!....and the profits from the event go to fund scholarships for SDSU’s new JR Filanc Construction Engineering and Management Program at SDSU!!!!

 

The Specialty Contractors prepare tri-tip carne asada with a “real man’s” stainless steel barbeque that is 20 feet long, and is transported on a large trailer with tandem wheels.  The barbeque is owned by Bergelectric and American Technologies.  It is probably worth the ticket price just to see the grill and our Specialty Contractors preparing the food!!!!

 

Now in the past the tailgate and the KGB Skyshow were the main attractions….but this year the football game will be outstanding….why…..I watched Chuck Long for the years in the early 1980’s when he was quarterback at the University of Iowa…the guy is a winner…and so will the Aztecs be winners with Chuck as their coach!!!!.....

 

Okay, just one Chuck Long story….the entire State of Iowa is still convinced that he won the Michigan State /Iowa game in 1983…..it was a cold gray day in November in Iowa City….about 70,000 attended the sold out game… all in parkas because it was so cold.  Long ran a “naked bootleg” around the right side and the ball crossed the goal in the last minute to win the game….but the official who was not in position said he was short of the goal line….. that official was booed for his entire career when he had a game in Iowa City…..I had seats on the 10 yard line and a perfect view….Chuck was in!!!!!!

 

Anyway, he went on to win game after game and finished second in the Heisman voting…..he will turn SDSU’s program around!!!!!

 

A great tailgate…..great college football……and the KGB Sky Show…..Give your employees a treat…

 

AGCSD Building Renovation Project Update

 

AGC’s Apprenticeship Staff are all having a good Monday!!!  After 4 months in trailers in the AGC parking lot, they have moved into their new offices in the lower level of the AGC Building…..and today is the first day they will operate out of this outstanding facility.  In addition, the rest of the 18,000 sq foot lower level hands on training area and classrooms are also ready…apprenticeship classes will start one week from tomorrow……it is simply unbelievable….the remainder of the addition and renovation will be complete at the end of September.

 

Our GC Soltek Pacific….our subcontractors….and Hurkes/ Harris Design Associates…..our architect, are all doing a great job!!!!

 

The AGC Board of Directors will be planning an open house…..more to come later…..but in the meantime, stop by and see the facility….we love to give tours to show off our new and improved “home”!!!!  

 

2 more weeks left to sign up for the AGC Softball Classic! - September 16th

 

5 more teams needed! Sign up now and join in on some friendly competition with other AGC member companies. The format for this popular event is double elimination, three pitch & USSSA Rules.  There will be 1^st, 2^nd, & 3^rd place team plaques.  Your team must be composed of your employees with a maximum of 15 players.  Two (2) ringers are allowed for each team, no exceptions!  The rosters must be submitted at the mandatory Coaches’ meeting, which will be on September 14 at 4:00 PM at the “Padres Pub”, located in the Mission Valley Hilton.   Contact Rae Krushensky at 858.558.7444, ext. 107.

 

AGC San Diego Chapter and AGC of California  present “Desert Impressions”- Fall Conference-  Oct. 11-14 at the Hyatt Grand Champions- Indian Wells

 

The AGC of San Diego Chapter and the AGC of California have joined forces to bring the entire statewide AGC membership together for the AGC’s Desert Impressions Fall Conference.  The Conference will be held at the beautiful Hyatt Grand Champions Resort in Indian Wells beginning October 11, 2006 and concluding Saturday morning Oct. 14^th.  It is expected that over 500 AGC members from throughout California will attend. Brochures have been mailed to all our primary contacts from each member company and the brochure can also be accessed on our website at http://www.agcsd.org/AGC%20flyers/San%20Diego%20Brochure.pdf

 

Members of the Meetings & Events Committees of both chapters have been planning the event for several months.  The AGC Fall Conference offers a number of high profile seminars and educational sessions, opportunities to network with other AGC members from throughout the state, and time to enjoy a variety of social events.  In addition, California’s political leaders that are interested in making sure our state invests on our infrastructure are expected to attend. 

 

All AGC members are invited to attend the AGC’s Desert Impression’s Fall Conference. Join over 500 of your peers from throughout the state for education, politics, networking, and fun! 

 

Make your plans now to attend the Fall Conference Oct 11-14th

 

 “iSqft Randy’s” iSqFt Tip of the Week & Obscure factoid

 

iSqFt Tip of the Week:

The AGC/iSqFt Internet Plan Room not only gives you full access to Plans and Specs online, it also gives you access to our network of General Contractors for private work.

 

Obscure Factoid:

At the time of Pearl Harbor, the U.S. Navy command was called CINCUS (pronounced "sink us").

 

Safety Newsletter

 

The AGC Safety Committee has been hard at work creating several newsletters throughout the year.  Go to Safety Newsletter link for the late summer edition of the Safety Newsletter.  The topics include: Hispanic Worker Safety, Young Workers, Be a Good Neighbor and the Joint California/San Diego AGC Meeting.   can If you have any questions about this newsletter contact Sam Iler or Sara Dahlke at (858) 558-7444 ext. 100.

 

Construction Project Management

 

“The Certificate Course”

The minimum number of registrants has been met and we will be starting the Construction Management Class on September 7 as scheduled. Thank you to all those registered and the companies that have sponsored these attendees.

“Time is Running Out”…

So far we have a good cross section of General Contractors and Subcontractors registered, and at this point we have “ 8 “ openings left. We do not want to exceed 30 in the class, so those still interested, please go to our website www.agcsd.org and scroll down to the calendar section to register. The September 7, 2006 date has a registration form to click on and fill out, and after you have filled out all the required fields, click on payment type and it will automatically be sent to the Education Department.

 

A tentative schedule with topics to be taught is available upon request; contact Glen Schaffer at gschaffer@agcsd.org for any questions or for a copy of this schedule.

 

Prevailing Wage Workshop

September 20, 2006                  9:30 AM thru 12:30 PM

Compliance Issues and labor codes to be discussed, learn to work with certified payroll, fringe benefit statements, and apprenticeship forms.

 

The “FRINGE” is an important tool that can be used by the contractor to be more competitive while offering field employees benefit packages and most importantly staying in compliance. If you’re paying the fringe as wages your company could be loosing thousands of $ and still not be in compliance.  Contact Glen Schaffer at gschaffer@agcsd.org or 858/558/7444 ex 108 for any questions.

 

AUGUST CLASSES

 

August 30 – CPR/First Aid – 8 AM – at National University –

9388 Lightwave Avenue, San Diego, CA 92123-1426 North of Aero Drive and Ruffin Road). 

 

Classes now begin at AGC office

August 31- Supervisory Training Program Unit 5- Session 1,” Introduction to Planning & Scheduling”

7:30 AM – at AGC

 

SEPTEMBER CLASSES

September 7 – Supervisory Training Program Unit 5 – Session 2 “Preparing the Project Plan”

 – 7:30 AM – at AGC

September 7 – Construction Project Management, “10 Goals and Team Building” - 3:00 PM – at AGC

September 8 – Scaffolding CPT & Hazard Awareness – 6:45 AM at AGC

September 14 – Supervisory Training Unit 5 – Session 3 “Communicating the Plan” – 7:30 AM at AGC

September 15 – OSHA 10 Hour – 7:00 AM at AGC

 

September 21 - Supervisory Training Unit 5 – Session 4 “The Critical Path” – 7:30 AM at AGC

September 21 - Construction Project Management, “PM Template” 3:00 PM at AGC

September 27 - CPR/First Aid – 8 AM at AGC

September 29 – Advanced SWPPP Training- 7:30 AM at AGC

 

SEPTEMBER MEETINGS – All meetings will be held at AGC unless indicated otherwise

 

September 7 - Joint General Building/Engineer Contractors Council Meeting – CANCELLED

September 11 – City of San Diego Liaison Meeting – 1:00 PM (rescheduled from Sept. 6^th)

September 13 – Government Relations Committee Meeting – 10 AM

September 19 – Education Committee Meeting – 12:00 PM

September 20 – Public Building Liaison Meeting – 7:00 AM

September 20 – AGC Toastmasters @ Roel- 7AM

September 21- Specialty Contractors Council @ Adam’s Steakhouse – 7AM

 

Save The Dates:

 

September 16 – AGC Softball Tournament

September 23– Aztec Football Tailgate and SkyShow

October 11-14^th – Joint Fall Conference with AGC of California in Palm Springs – details on website