Last Thursday, a hot topic on the agenda for the Hutto City Council was current City projects and the massive cost overruns of those projects. One project detailed was the East Street Project from Pecan to Farley. The initial budget for this project was $ 899,000.00. It now stands at $ 1,139,382.00, $240,382.00 over budget.
City Manager Odis Jones spoke candidly about project mismanagement and the resulting consequences.
“Let me be real direct, it happens when you don’t do a good job with scoping and costing a project” [speaking of the massive overruns.] “This is where we are. Moving forward, I’m going to be hands on and we have to do better work with how we structure our projects. Whether managing projects big or small, it’s junk in and junk out. You got to have real clear objectives and a real tight scope and contracts that are tightly done to protect you. We’ve got to do things where we are more sophisticated in terms of how we manage our contracts.”
Council member Anne Cano, who has been on the council since 2009 stated, “We’ve been here before, and that’s what happened to Farley and why the last block of Farley got cut out.” The cost proposed by the City to complete Farley in 2009 for the bond election was $1,283,600.00. However, in 2011, bids to complete the 1,800 square feet Farley roadway project came in nearly $1 million over the City’s projected $1,283,600.00 million dollar estimate.
To save money, the council voted to cut the Farley Street project from four blocks to three, eliminating the block between Short and West Street. Council member Anne Cano made the motion to award a total of $ 1,618,630.00 and set aside an additional $ 100,000.00 in project contingency and the motion was seconded by Council member Michael Smith. $435,000,00 over original budget.
Back to the Jan 5th council meeting regarding the East Street cost overrun, Council member Lucio, said “this has been in the plans for how many years. We outta have a guide in place already.”
Council member Hines who is one of the newer members to the council stated, “that’s correct, we have been here before, and before and before, and before”, clearly frustrated that projects are poorly managed and overrun with costs.
Council member Cano is correct, we have been here before, time and again. The latest East Street project, the Fritz Park 3.5 million dollar boondoggle, The 2.5 million dollar Gin “open air pavilion” project (that has no restrooms, A/C or heat) 200k over budget, Farley Street project and The YMCA to name a few.
Prop 4 of the 2009 Bond Initiative was for the construction of the YMCA. A bond package was approved by the voters totaling 5 million dollars to complete the project. But poor planning led to major cost overruns. The two major overruns that were reported (we have not yet investigated the final cost) were to the tune of almost ¾ of a million dollars over budget. $736,072.00 to be exact.
Of the $736,072.00 overrun, $550,000.00 was due to poor initial planning by the City that included no large site improvement. Also, the cost of bringing water and wastewater lines and access roads to the site were not included in estimates proposed in the bond election. The other $ 186,000.00 was due to cost related design and construction overruns.
Back again to the January 5th meeting, debate broke out regarding the necessity of focusing all of the funds on one downtown project when so many other areas of the City are badly in need of improvements.
Council member Michael Smith said he’s fine listening to input from other members about reducing scope and costs and then said “this is not a project we half ass. This is the center of our downtown.”
Councilman Killough fired back stating “Is this to make something look pretty again”, referring to the Fritz Park 2 million cost overrun.
Smith said “we’re adding parking”. Cano said “this keeps people from driving in the ditch across from the Hall of Fame”.
Killough said “We have 990 thousand dollars. So functionally, can’t we take that money and add it to that lot (the 1.1 million dollars) and resurface a bunch of streets? We are so focused on putting bows on stuff just to make it look pretty. And I’m going to bring it up, how over budget on Fritz are we?”
Gaul said “It’s not just prettying up downtown. We need additional parking downtown. But can we reduce the scope without the pretty bows and have the parking.”
Killough then said “Hold on, I have a hard time swallowing this pill. That you are going to spend 1.1 million dollars on one street while only allotting only 990k to use on all of the rest of the streets. Let’s be a little logical here and take a different approach and think about the financial standing of how much can I get done and how many more roads can we repair and fix.”
Council member Lucio said, “But this was a bond thing”, thinking the bond funds were dedicated just for the downtown project.
Killough then said “no that bond was for ALL roads.”
Smith then said “it’s for downtown I remember”.
Gaul then said “It’s not just resurfacing, it’s additional parking.”
Smith then said “If you remember Farley Street before we did that project.”
Killough said “I do, now with a whole lot of empty parking.”
Cano said “That’s too far to walk and they won’t go to the businesses.”
Gaul then said, “People aren’t going to park there and walk down to the businesses and go eat” referring to the parking on Farley Street that is only one block away. (see map)
Killough then said “We should go back to needs, not wants.”
The council then agreed to try to reduce the overrun by eliminating some of the project and would go “line by line” through each expenditure, just as they did Farley Street.
To clarify, Council member Killough was in fact correct. The 2009 Bond Election, specifically Proposition 1, was for the issuance of $8,500,000 in General Obligation bonds for street improvements within the City, not just “downtown”.
Prop 1 states “The City of Hutto be authorized to issue general Obligation Bonds of the City in the principal amount of 8,500,000.00 for the permanent public improvements and public purposes, to wit: constructing and improving streets WITHIN THE CITY and includes installation of underground drainage, sidewalks, and streetscaping to several downtown streets. Below is the full bond initiative language for Pro 1.
Hutto tax payers have been tagged with millions in cost overruns on poorly scoped and managed projects. The specifics of promised projects have been reduced or outright eliminated in some projects sold to tax payers in 2009. This has led to Hutto residents paying much closer attention to business conducted by the council.
One resident said “Seems to me a few of these council members don’t learn from their mistakes. 103 million in debt and nothing but politically spun excuses. Conservative my back side. When I don’t have money at home for something I “want”, I don’t just go charge it up, I have to do without until I save enough for it. I have to live within my means. When I have a project at home, I make plans and have a solid budget. If it goes over budget, I have to wait until I have the money to complete it. I don’t have a credit card someone else pays for like these politicians do. At least we have a few new council folks up there and a new City Manager who are trying get a hold of this mess. I’ve had enough and you can bet come May I’ll vote to put some more new blood up there.”
As Einstein once said, ‘The definition of insanity is doing the same thing over and over and expecting different results.” We will have more as this develops.