Recent articles noted county lost a $675,000 FAA grant to prepare the 2015-2035 Palomar Master Plan (PMP) because county avoided the FAA consultant selection rules. But the FAA had much more to say.
The FAA: Why so much money?
The county March 2013 FAA grant request for the PMP update asked for $750,000 including $675,000 for Kimley-Horn’s continued PMP work.
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But according to county meeting notes “Per FAA, [the] average cost of master plan should be between $350,00-500K (without eALP [an electronic Airport Layout Plan])…” [See June 13, 2013 email from Yavonka Burks to Peter Drinkwater.]
Before FAA input, County negotiated a Kimley-Horn price ($675,000) that was 45% to 90% higher than the FAA thought prudent. County renegotiated after the FAA input.
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Bear in mind that when county set the $675,000 Kimley price for a PMP analysis, county was already paying Kimley about $700,000 in 2012-2013 for the Palomar Runway Study. In other words, county wanted to pay Kimley-Horn $1.375 million for Palomar work. And, county also used Kimley-Horn for work at other county-controlled airports.
County: Where were the “competitive proposals”?
In 2009, county signed a 5-year contract with Kimley-Horn to provide architectural and engineering services “as-needed.” The contract end date was June 2013; county extended the date to June 2014 so Kimley-Horn could prepare the PMP. But the still-in-progress PMP work will not end until late 2014. Another contract extension will be necessary.
For six+ years, county shunned competitive proposals for the Kimley-Horn work. Obtaining such proposals is the only way county can know whether it is overpaying for work as the FAA believed. Competition usually lowers prices.
“As-needed” and “job specific” contracts differ in one key way. When proposing on “job specific” contracts, consultant quotes use a specific work scope. So county can compare consultant quotes. In contrast, in “as-needed” contracts, although county knows the hourly rates, the county can’t know the work scope for future jobs. What are Kimley-Horn’s hourly rates and how do they compare to those of like consultants?
The 2009 highest Kimley hourly fee for a principal engineer was $76.93 but the hourly billing rate was $249.04. The lowest 2009 Kimley hour fee for an Engineering Tech I was= $22.12 but the hourly billing rate was $71.61. Contract Exhibit C provided the hourly rates could be adjusted annually.
The County-Kimley fees show about a 200% mark up over the hourly fee. A big mark up is justified. Consultants have overhead including payments for pensions & medical, support staff, and office overhead. But is a 200% mark up too big? Would other qualified consultants take less? We’ll never know for sure. County avoided further competition to keep Kimley-Horn. But the FAA sure thought the price was high.
Should County Airports be asking for FAA grants and the Board of Supervisors be asking for tax and fee increases before improving county’s contracting practices?
