Sunday, April 30, 2017

City to Spend Big on Phase 2 of Industrial Park

The City of San Angelo Development Corporation board approved items for Phase 2 expansion of the Industrial Park.  The first act was the hiring of a grant writer/administrator to pursue federal funding.  The Grant Writer Request for Proposal (RFP) indicated the scope of the project:

The purpose of this project is to obtain assistance in developing a successful proposal in submission to Economic Development Administration’s Grant and response to all aspects of the grant implementation regarding the Economic Development Administration’s (EDA) grant for water, sewer, street, and drainage infrastructure improvements for Phase 2 of the City of San Angelo Business-Industrial Park. The total cost of the project is estimated at between $2.5 and $3 Million.
City staff selected GrantWorks, an Austin based company.  Grantwork proposed a $4,000 fee to write the grant plus 4% of the amount awarded for administration.

EDA documents show criteria for federal funding from 80% of the total project to 50%.  Using the city's numbers the maximum amount Grantworks could earn would be $96,000 for grant administration.  Add the $4,000 writing fee and the city could pay Grantworks $100,000.  The minimum amount Grantworks could be paid for administration is $50,000.  With the $4,000 grant application the total could be $54,000.

Oddly COSADC board member Todd Kolls questioned paying experts $100,000 a year when the city could hire someone for less to perform those duties.  Assistant City Manager Michael Dane responded, saying this would be the only grant the city has not administered by staff.  The city's accounting department and internal auditor assist departments with grant management duties but it is the department's responsibility to oversee any grant. 

No board member asked how Phase 1 came about, how the city pursued grants and managed those activities?  Economic Development Director Roland Pena informed the board that COSADC did not have staff to administer the grant.  Oddly, Mr. Pena's LinkedIn page states:

Director of Economic Development
City of San Angelo Texas January 2014 – Present (3 years 4 months) 

Plan, coordinate, and direct the City's economic and business development activities; develop and implement Strategic Plan, recruit, identify and develop new NAICS eligible businesses; develop and maintain economic development partnerships; negotiate contracts administer grants; oversee municipal economic development projects. 
After approving Grantworks the Development Corporation board tackled engineering services for Phase 2 expansion.  BREP Coordinator Bob Schneeman presented a two year timeline for project completion.   Schneeman revealed a Rail Spur will not be part of Phase 2. 

Staff chose Parkhill, Smith Cooper over three local engineering firms.  Staff did not project a dollar amount for engineering services for the $2.5 to 3 million project.

I take it the $110,000 sewer extension already approved by the COSADC board fits within the numerous activities to expand the Industrial Park.  It will be interesting to see a total for all these associated projects and the cost to buy engineering and grant administration, services the city could conceivably supply from within.

It was odd watching Roland Pena try to spin Grantworks as a local firm as they have an employee/contractor in the area.   The Texas Comptroller shows Grantworks as an Austin company with a President/Director in the Houston suburb of Sugar Land.

Pena tried to highlight PSC as local.  He said PSC's land surveyor lives in the area and would be coordinating the project for its Midland office.  RFQ documents show PSC in Lubbock.

More than one board member wanted the City to use local engineering firms when possible.  The city's depleted engineering department and massive demands for expertise (roads, sewer, water) means the vast majority of engineering work is outsourced.

I understand the need to bring in outside expertise at times, however the City of San Angelo seemingly needs consultants for almost any substantial project.  The Development Corporation is the latest evidence of this practice.

Update:  COSADC board also approved $165,000 for additional fiber optic telecommunications for the Industrial Park.

Update 8-20-17:  The Development Corporation board will take up the hiring of Grantworks and  Parkhill, Smith Cooper in the August meeting.

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