Lack of bids for I-530 job draws commission inquiry

State highway officials said Wednesday that they will review the specifications of a project on Interstate 530 coming into Little Rock to determine why no contractor submitted a bid Wednesday to do the work.

It isn’t uncommon for no one to bid on a specific highway construction project, but it is unusual for members of the Arkansas Highway Commission to question the Highway and Transportation Department’s director, Scott Bennett, on the reasons why.

The commission awarded contracts worth $100.4 million on 70 other projects Wednesday.

But commission members wanted to discuss why no one submitted a bid for the contract to rebuild an 8.2-mile section of I-530 from Bingham Road to Interstate 30, which also is near an interchange for Interstate 440. The winning contractor also would rebuild four bridges, install a rope safety fence, and complete the project within 150 working days.

Five contractors purchased bid specifications for the project, which reflected interest in the project. The contractors included Cranford Construction Co. of North Little Rock; Kiewit Infrastructure South Co. of Fort Worth; Koss Construction Co. of Topeka,Kan.; McGeorge Contracting Co. Inc. of Pine Bluff; and Redstone Construction Group Inc. of Little Rock.

Dick Trammel, a commission member from Rogers, began the discussion by noting he “got beat up last week” over the size of the penalty for going over the days allowed for construction in the specifications: $350,000 per day.

Tom Schueck, a commission member from Little Rock, asked if the penalty was an “abnormally high” one.

“I guess it would depend on the definition of abnormally high,” Bennett said. “There have been penalties in other states with projects like this that were much higher.

“We have kept ours down for a long time, but this is part of a “get in, stay in and get out” part of the construction because you’ve got an interstate work zone that’s coming in to two other interstates - Interstate 30 and Interstate 440. So there’s a significant amount of road-user costs in there.

“There’s delay coming this way in the morning anyway and you narrow everything down to one lane, that’s basically the daily cost of the public only being able to use one lane of the interstate and not being able to use both lanes.”

If the department followed the formula used to determine the road-user costs, which form the basis of the penalty, it would have been “much, much higher,” Bennett said.

Road-user costs include the cost of time in the work zone multiplied by the number of motorists who go through the work zone. The formula includes factors such as the additional fuel consumed, the additional wear and-tear on the vehicles and other things.

“It’s the same way we would basically calculate congestion [costs] on the roadway,” Bennett said.

In response to a question from another commission member, Bennett said other issues with the specifications may have been at play.

“There were probably some smaller contractors that would have trouble getting a performance bond that would cover $350,000 a day,” he said. “That was not a concern for everybody.

“From a lot of discussions I had, I think most of the concern was the amount of time we had on the job and the amount of asphalt that was going to have to be produced in that time frame. … They were concerned about being able to actually produce material at a rate that would allow them to meet that time frame.”

Part of the problem also is that it is construction season for not only the Highway Department but other entities that use asphalt, Bennett said.

“We’re not the only asphalt game in town,” he said. “This is the time of the year where cities are paving, counties are paving. There just may not be the ability to produce that volume in that amount of time.”

Also Wednesday, in a rare move, the commission voted to approve $5.6 million in purchases awarded by the department’s purchasing committee, except for one.

The exception was a $7,450 contract for O.J.’s Service Two to provide janitorial and cleaning services to the department’s District 8 headquarters in Russellville for six months.

The company was the low bidder, but some members of the Highway Commission were upset the department was awarding a contract to a company that has a lawsuit pending against the department.

In March, the North Little Rock janitorial company asked a Pulaski County judge to revoke a competitor’s contract with the department a month after that competitor accused the company of conducting a harassment campaign intended to derail the $380,000 deal.

O.J.’s sued the Highway Department, its director and five commissioners to nullify Razorclean’s contract and give it back to O.J.’s. Razorclean, owned by Madre Hill, a former Razorback running back and Oakland Raider, is not a defendant.

Razorclean was the first to sue, petitioning the judge Feb. 28, about 10 days after being awarded the contract, for an injunction against O.J.’s and its owner, Charles Hinson, complaining about a “campaign of threats and intimidation” directed at Razorclean’s customers and contract references. O.J.’s also hired a private detective to investigate the company.

“They’re suing the commission right now, but we’re awarding them a contract,” said commission member Frank Scott Jr. of Little Rock, referring to O.J.’s. “From a business perspective, if we were ever dealing with a vendor when the vendor was suing us, I wouldn’t award them additional business until that litigation has been resolved.

“I understand we are a public agency that has other things it has to consider, but it does give me heartburn.”

The five-member commission voted to approve all the purchases but the one involving O.J.’s Service Two until staff attorneys could research the question of whether the commission could hold up the contract until the litigation was resolved.

Arkansas, Pages 7 on 04/17/2014

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