AGENDA #4L
TO: Mayor and Town Council
FROM: W. Calvin Horton, Town Manager
Ralph D. Karpinos, Town Attorney
SUBJECT: Airport Gardens Rehabilitation Contract
DATE: April 14, 2004
The attached resolution would direct the Town Manager to not execute the pending contract with Carl Garris & Sons, Inc. for the rehabilitation of 18 of the residential units in the Airport Gardens Public Housing neighborhood and to re-advertise this project for new bids.
Based on the letter received by the Town on April 8, 2004, from the U.S. Department of Housing and Urban Development which states that the Town’s Instructions to Bidders did not comply with Federal Regulations, we recommend adoption of the attached resolution.
We intend to immediately institute a procedural requirement that all Instructions to Bidders be reviewed by the Assistant Town Manager and Town Attorney to attempt to prevent similar problems on future formal bid projects.
DISCUSSION
On January 28, 2004, the Council accepted a bid and awarded a contract in the amount of $757,000 to Carl Garris & Son, Inc. for comprehensive rehabilitation work for 18 apartments at the Airport Gardens public housing neighborhood. The 18 apartments were included in the base bid for eight apartments and an additional 10 apartments in Alternate 2. The decision to award a bid for the Base Bid plus Alternate 2 was based on the prices submitted and the funds available to the Department of Housing at this time for this rehabilitation work. Carl Garris & Son, Inc. was the low bidder.
Following the Council’s action on January 28, 2004, questions were raised by one of the bidders on this project who was not the successful bidder. On February 6, 2004, we received a letter from Walter E. Ricks, III, Attorney, on behalf of Hairston Enterprises, raising concerns regarding how this bidding process was conducted and the language included in the Council’s adopted resolution. Mr. Ricks asserted that his client, Hairston Enterprise, was the low bidder.
Mr. Ricks also submitted a bid protest for this project to the U.S. Department of Housing and Urban Development Office of Public Housing (HUD) in Greensboro, N.C. We provided to the Federal agency all of the documentation requested regarding the bid procedures followed by the Town for the Airport Gardens rehabilitation work.
On April 8, 2004, we received by facsimile transmission a copy of a letter from HUD. Attachment 2 is a copy of that letter. HUD has determined that the Town “violated procurement standards at Title 24 Code of Federal Regulations (CFR) 85.36(c)(3)(1)”. HUD concluded that the Town’s written selection procedures did not include a clear and accurate description. They “strongly suggest” that the Town “reject all bids for this project and re-bid the procurement.” Upon receipt of this letter the Town Attorney notified the low bidder, Carl Garris & Son, Inc., and advised them that we would be reporting HUD’s determination to the Council on April 14, 2004, along with a recommendation that the Council direct the Town Manager to not sign the pending contracts with their firm. A copy of his letter is attached.
RECOMMENDATION
We recommend that the Council adopt the attached resolution directing that the previously awarded contract to Carl Garris & Son, Inc. not be signed and directing that the Airport Gardens Rehabilitation project be re-bid. For this project and all other future formal bid projects, we intend to have the instructions to bidders reviewed by the Assistant Town Manager and Town Attorney prior to publication in order to try to avoid similar problems in the future.
ATTACHMENTS
1. April 8 letter from U.S.Department of Housing and Urban Development (p. 4).
2. April 8 letter to Carl Garris & Son, Inc. (p. 6).
A RESOLUTION DIRECTING THAT THE AIRPORT GARDENS REHABILITATION CONTRACT NOT BE SIGNED AND THAT THE CONSTRUCTION CONTRACT BE RE-ADVERTISED FOR BID (2004-04-14/R-11.1)
WHEREAS, the U.S. Department of Housing and Urban Development (HUD) received a protest pertaining to the procurement of rehabilitation work at the Town’s Airport Gardens public housing neighborhood and has concluded that the Town did not follow procurement standards in the Code of Federal Regulations; and
WHEREAS, the HUD has strongly suggested that the Town reject all bids for this project and re-bid the procurement;
NOW, THEREFORE, BE IT RESOLVED by the Council of the Town of Chapel Hill that the Council’s previous action to award the contract for this work to Carl Garris & Son, Inc., is hereby rescinded.
BE IT FURTHER RESOLVED that the Town Manager is directed to not execute the pending contract for this rehabilitation work with Carl Garris & Son, Inc. and to initiate the steps to re-advertise this project for new bids in accordance with the directions from HUD to provide clear language regarding the alternates included in the proposed construction contract.
This the 14th day of April, 2004.