City subcontractor over-contributes to Coble

2008-08-29 / Business

By John Temple Ligon Temple@TheColumbiaStar.com

More than two years ago, a Columbia Star investigation of campaign contributions among members of Columbia City Council revealed some disagreements with the South Carolina Ethics Commission, particularly with Section 8-13-1342, which is quoted here in part:

No person who has

been awarded a contr act

with the state, a county, a

municipality, or a politi cal

subdivision ther eof,

other than con tracts

awarded through competitive

bidding practices,

may make a contribution

after awarding the contract

or invest in a finan cial

venture in which a

public official has an

interest if that official was

in a position to act on the

contractor's award. No

public official or public

employee may solicit

campaign contributions

or inv estments in

exchange for the prior

award of a contract or the

promise of a contract with

the State, a county, a

municipality, or a politi cal

subdivision thereof.

Another rule that governs city elections is no candidate can receive more than $1,000 from any one contributor during the election cycle. If a contributor is the CEO of a company, the contributor might give the $1,000 maximum, but the company might also kick in $1,000, and family members and other executives inside the same company could cough up $1,000 each as individual contributors. A company, though, cannot contribute more than $1,000.

Under the city's subcontracting outreach program, Columbia- based DESA has succeeded in contract negotiations with the city, rarely through competitive bidding. DESA's construction management services typically overlap with a project's prime construction manager or its general contractor, but DESA's services in handling other subcontracting outreach program beneficiaries on a city project appear valuable to the city, about as valuable as the architecture/engineering team.

On large projects the architecture/engineering team is paid about 6% of the construction cost. DESA agreed in a 2005 contract to work on the construction of the Southeast Park tennis complex for 6% of the construction cost. As the contract stated, "The CM shall be paid six (6%) percent of the sum of the general contracts for the Project."

DESA, the company, contributed $1,000 to Mayor Bob Coble's 2006 re- election campaign on February 21, 2006. Then, just two weeks later, but before the election in April, DESA gave another $1,000 to the campaign, bringing the total to $2,000 for the election cycle, $1,000 over the legal limit.

The Ethics Commission has a new reporting policy, and as of the first of this year, all contributions have to be carried on the Ethics Commission's Web site. Breaking the rules is not likely to happen much more with the new scrutiny.

Still, it did happen in this instance without competitive bidding between a contractor who negotiated successfully and the city where the mayor was running for re- election.

DESA's disregard for the rules is not unique.

Architecture/engineering firm Stevens & Wilkinson, for most of Coble's term as mayor the city's prime architecture/ engineering firm of choice, gave Mayor Coble $500 in late December 2005, and S&W's CEO Bobby Lyles personally gave another $500 on February 3, 2006.

But Coble understood the means to by- pass the $1,000 limit without DESA's disregard. His "Citizens for a Balanced Community," a political action committee took from Lyles personally $2,000 on Aug. 18, 2004, and S&W gave $2,000 on Aug. 24, six days later. PACs have different maximums.

Through 2003, S&W was working on the city's convention center headquarters hotel, having already been the A/E firm for the convention center itself. S&W did not competitively bid on either project. The S.C. chapter of the American Institute of Architects won't allow it.

S&W had a memorandum of understanding with the city to provide full architecture/engineering services for the city's convention center headquarters hotel for $2.3 million, less than 6% of the construction cost.

The city backed out, canceled the project, and all of S&W's work was no longer needed. The privately developed replacement Hilton hotel needed only about $400,000 for the complete architecture/ engineering package to meet the demands of the Hilton organization.

S&W was paid about $700,000 in late 2003 as a partial payment, and the firm is suing the city for the balance.

It's not necessarily true fat campaign contributions result in fat design and construction management contracts with the City of Columbia without competitive bidding. But maybe it is true the S.C. Ethics Commission's rules of the game apply to all campaigns and all contributors, at least after a formal complaint is filed.

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