July 17, 2012

City Council rejects airport terminal contract rebid

The Wichita City Council decided Tuesday not to rebid a $100 million airport terminal construction contract, despite assertions from a rejected bidder who claims the city is wasting more than $2 million of public money and that the selection process was a “kangaroo court.”

The Wichita City Council decided Tuesday not to rebid a $100 million airport terminal construction contract, despite assertions from a rejected bidder who claims the city is wasting more than $2 million of public money and that the selection process was a “kangaroo court.”

After nearly three hours of hearings and deliberations, the council voted 5-2 to deny an appeal by a Wichita-based Dondlinger and Sons Construction and Indianapolis-based Hunt Construction Group, and to award the contract to a partnership of the Wichita-based Key and Detroit-based Walbridge construction companies. Acting as the Airport Authority, the council upheld earlier actions by the airport staff and the city Board of Bids.

Although the Dondlinger/Hunt partnership had the lower bid, about $99.4 million to Key/Walbridge’s $101.5 million, officials of the city-owned airport said the Dondlinger group had failed to comply with requirements that 7.11 percent of the work go to minority- or women-owned subcontracting firms.

The minority and female participation — or a good-faith effort to get it — is required for the airport to be eligible for federal grants to pay about 45 percent of the project’s cost.

Dondlinger president Tom Dondlinger said after the meeting that he was “extremely disappointed” by the decision.

A lawyer for his company had argued that Dondlinger and Hunt at the very least had met the “good faith” test in recruiting historically disadvantaged business enterprises, also known as DBEs.

City officials expect the case to go to court, and the council members spent a half-hour behind closed doors discussing the legal implications of their upcoming decision.

Dondlinger did not rule out taking the battle to court.

“I’m disappointed with the council,” he said. “We’ll see where it goes from here.”

Wyatt Hoch, a Wichita lawyer representing Dondlinger/Hunt, said that by awarding the project to the second-lowest bidder, “the authority wants to pay $2.1 million more for the same scope of work.”

The Dondlinger group had more than enough minority- and female-owned participation to exceed the threshold for federal grant eligibility, he said.

But at the time the bids were opened in late February, three of the subcontractors were not certified as DBEs by the state Department of Transportation, so Dondlinger didn’t get credit for their participation.

All the companies in question have since acquired certification as DBEs, Hoch said.

He argued that the federal rules require that the DBE participation be in place “at the time the contract is executed, not on bid day.”

“The Airport Authority has misinterpreted the DBE rules,” he said.

Hoch also objected to the bid board process, saying “it’s my best new example of the definition of a kangaroo court.”

He read the council a letter from the airport to a federal aviation official that he said indicated the bid board had rejected Dondlinger/Hunt a month before the case was argued before the board.

“I couldn’t believe that a city board that was part of our appeals process, that we hadn’t gotten to yet by almost a month, had been asked to make a recommendation against us one month earlier, and they did,” he said.

A lawyer representing the authority staff argued that the rules were clear and fair and said the airport staff had done nothing wrong.

Attorney Polly Jessen of Denver said rebidding the contract would be unfair since all the bidders have now shown their hands.

“As a matter of law, rebidding is not a favored remedy,” she said.

She compared the Dondlinger appeal to children on a playground.

“Anyone who has ever played a game is familiar with the concept with children of a do-over,” she said. “And you have a do-over if someone couldn’t concentrate or there was cheating or you didn’t agree with the calls. The whole point when someone wants a do-over is because they didn’t win and they really wanted to win.

“In this instance what they were asking for is a do-over because they didn’t provide the required documentation and their bid was determined non-responsive, the way the airport does this routinely.”

Mayor Carl Brewer and council members James Clendenin, Lavonta Williams, Jeff Longwell and Janet Miller voted to reject Dondlinger’s call for a rebid.

“It’s very clear to me that (the disadvantaged business) information was to be provided on bid day,” Miller said. “That was shown to us in writing.”

“I don’t think there has been any abuse of judgment (by airport staff) and the facts speak very clearly for themselves that that (Dondlinger) bid was not responsive,” she said.

Council members Pete Meitzner and Michael O’Donnell supported the Dondlinger position.

“It seems that there was a whole lot of confusion during the bid process,” O’Donnell said. “It seems like there were some questionable actions taken by people associated with this contract working for the airport in particular.

“Proceeding without just rebidding is going to subject us to further courtroom litigation setting the project back a little bit further and that concerns me,” he said.

Airport director Victor White said he was pleased with the council’s decision but disappointed that the appeal has delayed the start of construction by almost five months. Construction had been scheduled to begin last month with completion of the new terminal scheduled for late 2014.

The delay will likely push the project into 2015, although now there’s no firm time line, he said.

“We need to regroup and find out exactly what happened,” he said.

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