Recap of Building Projects Cost Overruns

Don’t Shoot the Messenger! The messenger is NOT the problem… The Problem is The Problem.

Last night there was a Special Commission meeting to discuss the budget overruns on the two building projects. This was requested by Commissioner Anderson as the original item (regular April Commission meeting) was placed near the end of the agenda and due to the late hour, few residents would have been there to hear it. But, before we take a step forward… we must first take a step back to understand the situation and problems that arose from what looks to be a lack of fiscal oversight.

In advance of the April meeting (disclosed in the backup), it was discovered that the alleged total for both buildings was $1,800,147.24. To repeat, one million eight hundred thousand dollars! I use the word “alleged “due to the fact it appears that there were project expenses (such as the landscaping for the log cabin and others) that were not included in the reconciliation. Why? Beats me.

The data provided in the reconciliation statements is very confusing, but regardless, the point remains the same. To that end Chuck Ross has reconstructed the numbers for both projects and listed below is a brief overview.

 First, adding back the $89,000.00 fee for the architect (that somehow was missed in the manager’s feasibility study to borrow the $350K loan- how does that happen?) and the adjusted contingencies, we started out the project underfunded by $126,891.00 [7.64%] back in May, 2015. This was before we ever broke ground. As to the cost overrun, Chuck is coming up with $161,216.00 or [8.85%] The funding shortage of $126,891.00 was the leading cause of the $161,216.00 overall shortage.  There were unexpected post construction credits and grants that reduced the shortage by $34,600.00 to $126,616.00 - not the $115,213.24 [6%] as claimed by the manager in her report.

However, as mentioned above, there are some costs yet to be identified. To reflect a shortage of $115,123.24 net of the unexpected credits and omitting certain costs is misleading.  Clearly the planning was suspect.

Two points to learn from this:

First, the manager should have recalculated the funding requirements after the final bids for the Log Cabin project had been accepted.  The error (funding shortage) would likely have been discovered and adjustments would have been made to the project. 

Second, the manager did not report to the Commission the change orders as the project progressed.  Again, the error would likely have been discovered.

Since the Commission was not made aware of the additional costs, they did not have the opportunity to assess changes that could or should be made to the project to take into account the additional funds required to complete the project.    

Total expenditures Village Hall= $969,909.80

Total expenditures Log Cabin=   $830,237.44

Again, this is assuming that the reconciliation total costs are complete and accurate. This number was a shocker as how many residents even knew about the budget for the two buildings? I know that Commissioner Ross had been asking for progress reports and financial updates for many months only to be delayed by the manager. It was never fully disclosed to the public (taxpayers) until again, months after the fact.

And herein lays part of the problem. Where was the fiduciary responsibility from both the manager and our Commissioners during the process?  Why was there no degree of any fiscal restraint when the budget overruns were first discovered? And who was responsible for signing off on all of this overage?

 Section 4.07. - Appropriation amendments during the fiscal year.

 (B) If, at any time during the fiscal year, it appears probable to the Manager that the revenues available will be insufficient to meet the amounts appropriated, s/he shall report to the Commission in writing without delay, indicating the estimated amount of the deficit, and his/her recommendations as to the remedial action to be taken. The Commission shall then take such action, as it deems appropriate, to prevent any deficit spending not covered by adequate unappropriated financial resources including reserves.  

In short, this just didn’t happen. This wasn’t an “option” but a Charter requirement. The manager did not publicly address the budget overages, without delay, and instead ostensibly just made her own decision to keep spending unappropriated Village funds. Nor was this Charter requirement adhered to on another potential cost overrun of approx. 50% (over the grant amount) towards the new Village Signage. (half of which, by the way, have not been installed due to running out of money by the inclusion of  solar lighting that somehow got added to the project after the fact. Solar lighting within our dense tree canopy… was this a good idea?)  Especially after just running over budget on your prior project? Do you see a trend here?

It seems as if our Commissioners bought into the paradigm of “not micromanaging the manager” to the degree of simply providing no fiscal management or institutional oversight at all! Or, in fairness, of potentially being rebuked by the manager if efforts were indeed attempted citing “I’m the professional here, don’t micromanage me,” etc. Further, there seems to be some misunderstanding of what the term “micromanaging” means.

Definition of micromanage

To try to control or manage all the small parts of (something, such as an activity) in a way that is usually not wanted or that causes problems

Definition of oversight

Watchful and responsible care  b:  regulatory supervision

See the difference?  But for whatever the reason, blind trust was offered and we now bear the cost for such lack of judgement. For me it's the process, poor planning, and the lack of transparency of not informing everyone what these buildings were actually costing us... until it was too late. The bottom line is always what is this going to cost us – the Biscayne Park taxpayers.

We hired a first-time manager who had over the past year demonstrated varying concerns regarding both her attitude and work performance. These concerns were shared with our Mayor and other Commissioners, yet were seemingly overlooked. Remarkably, some STILL seem to want to overlook these problems. Per her employment agreement “The Village Commission agrees to annually review the performance of the Village Manager prior to the anniversary date of this Contract.” This should have been done prior to last October… yet it didn’t happen. Why?

In my opinion this is cause for concern moving forward. Trust should be earned over a period of time based on deeds and performance… not just given freely to any new Village employee.

I can only hope that we’ve learned a hard lesson based on this experience as we now move on to our next manager. (Oh, and sorry for burying the lead, for anyone who didn’t already know, our manager has resigned effective April 29^th.)

Which leads me to this:

Don’t Shoot the Messenger! The messenger is NOT the problem… The Problem is The Problem. Deal with it and shoulder the responsibility you chose when you sought public office.

To suggest that our residents that pointed out legitimate concerns about the manager were The Problem is in truth, well… insulting. Insulting and delusional. Deflecting Problems does not solve The Problem. Pointing out Problems does not create The Problem. Lack of action only further increases The Problem. Our residents have every right to expect better results and representation from our elected officials.

The manager will soon be gone, yet we remain to pick up the pieces. It’s time for our leaders to lead.

Standing Watch-

Milton Hunter

The Biscayne Parker

miltonhunter@gmail.com

P.S. The videos of the April meetings are now up on YouTube. Links below:

April 5^th Regular Commission meeting- https://www.youtube.com/watch?v=RJirEBdFl_s

April 11^th Special Meeting/ manager resignation- https://www.youtube.com/watch?v=THWhaF-ymPk

April 20^th Special Meeting- Buildings budget recap- https://www.youtube.com/watch?v=FJAq-Js2YmI