June 14, 2012

Dispute delays work on new Wichita Mid-Continent Airport terminal

The start of construction on a new terminal at Wichita Mid-Continent Airport is months behind schedule because the bid process for the roughly $100 million contract is in dispute.

Editor's note: A previous version of this story listed Jim Anderson's name incorrectly.

The start of construction on a new terminal at Wichita Mid-Continent Airport is months behind schedule because the bid process for the roughly $100 million contract is in dispute.

Dondlinger and Sons is the lowest bidder, but the contract may be awarded to Key Construction instead because city officials don’t think Dondlinger met the bid requirements for building the terminal. Both companies are based in Wichita.

The new two-level, 273,000-square-foot terminal – which will feature 12 gates, each with a passenger loading bridge, more efficient passenger and baggage security screening, baggage claim and airline ticketing systems – initially was projected to be done in late 2014 or 2015. Due to the dispute, that’s likely to be pushed back.

“We’ve given the city a couple of ways to get out of this mess, and whether they’ll take it or not, we don’t know,” said Jim Anderson, one of the Foulston Siefkin attorneys working on behalf of Dondlinger and Hunt Construction Group of Indianapolis.

The two companies teamed up to build Intrust Bank Arena. They bid $99,370,542 for the airport contract.

Key, in partnership with Detroit-based contractor Walbridge, bid $101,500,542.

The Wichita City Council, which will make the final decision on the contract, was updated on the dispute during an executive session Tuesday.

“This is a monstrous decision,” council member Pete Meitzner said. “It affects the next 50 years of the terminal and our city.

“It is a decision that I am not taking lightly. It just needs to be fair and the right decision.”

Because the terminal will be funded in part through federal grants – airport passenger facility charges and airport revenue will make up the rest – certain requirements must be met in the bids. That includes the stipulation that either 7.11 percent of the contracting business be shared with disadvantaged business enterprises (DBE), such as minority-owned firms, or that the bidders show that they made a good-faith effort to reach that percentage.

That’s what’s at issue in the bidding process. Dondlinger has filed a bid protest, which follows an earlier review of the DBE requirement and a motion to reconsider, both requested by Dondlinger.

“We are firmly convinced that we did more than enough, and frankly that decision-making process is pretty subjective,” Anderson said.

In response to a request for comment, city attorney Gary Rebenstorf said in a statement: “That protest is under review according to the City’s purchasing policy. The review process is confidential. When the review is completed, the outcome will help determine what happens next.”

No one with Key Construction is commenting, but Anderson said that at the time of the initial bid, neither Key nor Dondlinger reached the 7.11 percent threshold. Anderson said the city determined that Key made a good-faith effort while Dondlinger did not.

“We don’t know how they made that determination,” Anderson said. “From what we have been able to determine, we don’t think that’s a correct decision.”

Anderson said that when Dondlinger made its bid, two of its DBE contractors hadn’t yet been certified by the Kansas Department of Transportation, but they have now. He said that puts Dondlinger over the 7.11 percent.

“We’re just at a loss to explain why this has happened, to be honest with you,” Anderson said, “because Dondlinger has been involved with the minority business community for years and has always actively participated.”

Donna Wright of the Mid-America Minority Business Development Council, an organization that links minority-owned companies with other businesses, initially thought Dondlinger won the contract and wrote a congratulatory letter that the company then used in its appeal to the city.

“I was very surprised if they did not meet that goal,” Wright said. “I’m very supportive of the Dondlinger company because of their past work with us.”

Anderson said “the requirement is that DBE actually do that work,” and he wonders whether that would be the case with Key.

“We frankly question one or more of their subcontractors as being qualified to do the work,” he said.

He said more than half of the DBE work Key submitted would be through a two-person Lawrence firm that Anderson maintains wouldn’t be large enough to handle it. Anderson said the city claims its procedures require a bidder must meet all the goals for a contract on the day a bid is submitted.

“We think their documents in that regard are ambiguous.”

Regardless of which company wins the contract, City Council member Jeff Longwell said all the bids came in lower than anticipated, which he said is “very attractive costwise.”

Longwell said his concern “is getting this issue finally resolved because we’ve made the decision that this community wants a new airport.”

“We should have been coming out of the ground with the airport six months ago,” he said. “But we’ll make the best of it.”

Anderson said litigation is an option if Dondlinger doesn’t win the contract, but he said the company has offered the city two ways to avoid that.

“We would agree to binding arbitration, which would go much quicker than a court case,” he said. “Time is somewhat of the essence in all of this.”

Another option, which he said Dondlinger would prefer, is for the city to rebid the project.

“Because so much time has passed we think they ought to just rebid the project with clear bid requirements.”

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