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Concerns of stimulus funding intended for Montana being directed to out-of-state companies

The opportunities being LOST here are too important to the Montana economy, to not put up a fight.

We believe it may be too late for CTA and other design firms, but not for the construction phase services. Montana professionals need to do what they can for their local contractors, suppliers, trades, etc. and the trickle down of these dollars through the local economy.

Pasted in below is a summary of what is known to date.

Please let me know if you have any questions.

Thanks,

ken

Ken Richardson

CTA Architects Engineers

306 West Railroad Ave.

Missoula, MT 59802

406-728-9522

800-757-9522

Cell: 406-581-9092

[email protected]

***

Several weekends ago, there was a news release from Senator’s Baucus and Tester about $77,400,000 being secured for 5 border stations on the US / Canada International Border in Montana.

The current status related to this funding:

There is actually $420,000,000 in funding for 43 border stations in the stimulus bill – most on the northern border (only 4 on the southern border). The following link is to the DHS press release, provides a listing of the locations by state. (put cursor on link, hold down the ‘ctrl’ button on the keyboard and then left click)

Shortcut to: http://cbp.gov/xp/cgov/newsroom/news_releases/04082009_6.xml

8 locations are listed for Montana – Del Bonita, Morgan, Opheim, Scobey, Whitetail, Whitlash, Wild Horse and Willow Creek.

The intent is to replace 23 border stations along the border and renovate the other 20. Of the 23 new, 9 will be done by GSA, 9 will be done by the Corps of Engineers, and 5 will be done by DHS. They will then compete with each other to see who can deliver the projects the quickest.

The confirmation is that DHS has already hired Parsons Engineering, a nationwide architecture and engineering (A/E) firm, to do all of the front end work, preliminary design and preparation of the technical packages that will be used to procure these projects. That includes design of each port up to approx. a 50% status.

Parsons is a 10,000+ employee firm that billed $1,500,000,000 in 2008. Ninth largest firm in the US according to ENR Magazine Top 500 listing. Headquartered in Pasadena, CA.

Jacobs Engineering (50,000 person national firm) will be doing all implementation/procurement and construction phase services. Jacobs billed $4,300,000,000 in 2008 and is #2 in size per ENR’s Top 500 firms. Also headquartered in Pasadena, CA.

The reason their firm size is important, is that virtually NO companies in Montana can compete with these mega-sized firms that obviously have very deep roots into DHS and GSA, and probably the COE. Montana companies don’t have the resources or lobbyist connections to compete – they were on board before the money was even announced to the public, so how could any Montana companies compete?

Further, GSA intends to use in-place Design/Build contractors – there will NOT be competitive bids for construction by Montana based General Contractors for any of the ports located in Montana. Senator Baucus’ office has the names of the contractors, all are from out of state, and they already include A/E’s on their teams, plus consultants.

The COE intends to use in-place MATOC (multiple award task order contract) contractors – there will NOT be competitive bids for construction by Montana base General Contractors. Like the GSA contractors, Senator Baucus’ office has the list, NO Montana contractors.

DHS intends to use Native American Contractors for their 5 projects – again, NO Montana based contractors.

It’s highly likely that no Montana based architecture; engineering or general contracting firms will be involved in these projects.

So – is this the intent of the Stimulus spending? One of the largest A/E firms in the world is getting 100% of the professional services work on the design and front end of these projects. Another of the largest firms in the world is getting 100% of the implementation and construction oversight contracts on the GSA projects. Two government agencies, the GSA and Corps of Engineers will get all of the management and oversight.

Out of state contractors that are already in-place will get all the construction.

And Montana architects, engineers and general contractors will evidently get nothing. Hopefully local subcontractors and suppliers will be allowed to participate.

The information provided is that, on at least the GSA locations, the solicitation packages will be out in June. Awards will be made in August. A very aggressive schedule. Just in time for construction to begin on the hi-line of Montana during the winter.

It’s curious that even though California was well rewarded in the stimulus, with billions upon billions upon billions of dollars, that the US Government is going to use California firms for delivery of these Montana projects. So the comparatively modest amount that Montana did get ($ 77.4 M), goes to firms from California.

Key Points from all of the above:

· $330,000,000 of work essentially went to a SINGLE firm, Parsons. Parsons is doing 100% of the design work related to preparation of the technical solicitation packages. Jacobs Engineering will be doing Program Management in the construction phase for GSA.

· How many small businesses in Montana, and the other states involved, could have been helped by getting a portion of this work? To give it all to these two firms goes beyond the limits of belief – the stimulus was supposed to help ‘everyone’, but it appears that DHS, the COE, and GSA have chose to help only a selected few with this funding.

· They are using mega sized nationwide contracts, instead of pushing the work to the states – the benefit to the states is zilch. Mega firms in the large urban centers, that probably already received more stimulus money that Montana, are getting the entirety of this work also.

· There is no need for all of the speed of Solicitation and Award – slower would actually be better. The northern border of MT and ND, where the majority of this work lies, cannot support the volume of construction that this work represents. So most of it will go to out of area, or out of state firms. Why not slow it down, do 2-3 per year in MT and ND each, then local contractors and suppliers can compete and they’d have work for 3-4 years, in lieu of simply pushing this huge amount of work out in a single package.

· They are bidding these in August – with awards following. That means that construction of $100,000,000+ of construction work will start on the northern border of MT and ND late fall, so that foundations and site work will be done in the heart of the winter. That’s not the ideal weather to begin this large of a construction program. Why not award to more local firms, design this winter, bid in the spring and start construction in late spring after everything thaws out. Why the rush, except that the Corps and GSA are competing to see who can deliver these the quickest – thus be the preferred provider for the next round of funding.

· Summary – what appeared to be a real benefit to the very slow economy of Montana, is in fact, not much of a benefit at all. The majority of the $77.4 M will never see Montana. Companies across Montana are faced with laying off good employees, while dollars intended to prevent this are directed elsewhere. It is time the federal government started acting more responsibly. Let your delegation know your thoughts.

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