New economics discovered in Columbia

2008-08-22 / Business

Commentary By John Temple Ligon Temple@TheColumbiaStar.com

When Richland County property owners in Richland One pay taxes to Richland County, they get hit for the expenses in housing and running education programs. The program costs are partially carried by state and federal contributions, which come from income taxes collected from all over. The costs of the Richland One school buildings, though, are overwhelmingly carried by the taxpayers in Richland One.

When Dreher High School, for example, had to be designed and built, Richland One went to Perkins & Will, one of America's best- tracked school design firms. Perkins & Will, founded in Chicago, has offices across the country. The architectural design fees probably were collected by people not living in Richland One.

Once the construction documents, all the drawings and the specifications, were complete, the job was let out to bid. The various suppliers and sub- contractors responded from all over, presumably, because the dollar amounts were so impressive.

Chances are, few of the dollars paid out actually went to anyone in Richland One, unless there was favoritism beyond competitive bidding in selecting neighborhood firms.

Roughly concurrent with Dreher's design and construction were the renovation and replacement of another 16 educational facilities within Richland One, eating up a voter-approved total budget of $381 million. For the present, 12 of the 17 facilities are occupied, and another five are expected ready for occupancy by December 2009.

By December 2009, then, Richland One will have a showcase of marvelous school buildings with state- of- the- art fixtures, furnishings, and equipment, all inside envelopes designed by architects of high reputations.

So, that's $381 million paid out by the taxpayers of Richland One for the 17 structures. For their money, the taxpayers get the buildings, but they don't necessarily get any of their money back.

Michelle Moshinskie of DESA Inc. begs to differ. Her firm, DESA, is in the business of assuring us the minority makeup on any construction site they manage meets the targeted goal, usually about 20 percent of the work under the control of DBEs, or disadvantaged business enterprises.

At Dreher, DESA's management services were in addition to the overall management by Southern Management, who handled the actual construction.

Moshinskie of DESA

sent The Columbia Star

recently an exercise in economics, an explanation prepared for public scrutiny of how the taxpayers' money somehow recycled back home after most of their $381 million had been spent.

According to Moshinskie of DESA, "During the past six years, these projects tremendously helped the local economy. Already- stable businesses grew to the next level, numerous jobs were created and most of all, large amounts of money have been invested within the local area."

She further purports, "Lastly, money spent on construction supplies not only increases revenue for the community and state, but also gives local suppliers and small, woman and minority- owned businesses (SWMBEs) a chance to increase their participation."

Moshinskie, located by telephone at her DESA office, presented her credentials in matters of economics: degrees in the culinary arts and marketing, and continuing education to snare a degree in advertising. Her superior, Diane Sumpter, CEO at DESA, has her degrees in English and Social Work.

When told that Columbia city contracts targeting a 20 percent participation rate by SWMBEs appeared to be running millions of dollars above fair and open competitive bidding, she had no comment. When told that the U.S. Supreme Court hasn't looked favorably on public policies preferring any woman/minority business enterprise in the public procurement process, she had no comment.

What with the general contractor (or the chief construction manager like Southern Management) and the sub- contractors and the architects and the engineers crawling all over the place as they bump into the suppliers and the inspectors, DESA's primary purpose on the construction site appears to be the management team assuring the public the job site is maintaining the targeted 20% participation by SWMBEs.

And when told that DESA's fees on most projects, to include tennis courts at Greenview and Southeast and the city's new animal shelter, appear to run about 6% of the construction total — close to the typical architecture /engineering combined fees of about 6% of the construction total for getting the project designed and documented and built and occupied — she had no comment.

Epilog: Just before press time, DESA head Diane Sumpter called to say DESA's fees for the tennis courts and the animal shelte r were 5%. Upon hear i ng a reading of her co n tracts with the City of Columbia, citing the 6% fee, Sumpter recanted. But she did say her firm's fees at Dreher were less than 6% because it was "such a big job." She claimed Southern Management's fees for the construction management at Dreher could have been as much as 7% of the total con struction cost.

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