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By John Diers

February 4, 2017

Two local news stories appeared in the last ten days. Both are on different subjects, yet both of them are woven together with a common thread of failed accountability. One appeared in the January 21 edition of this newspaper, the other in the January 25 edition of City Pages. One involved the City of Prior Lake, the other the Prior Lake-Savage School District. If you haven’t read the stories, do so. They’re instructive, but only to the extent that the public responds and demands action on both of them. That is the reason for this column.
In September 2014 Savage and Prior Lake came together with MNDOT on a plan to install a traffic signal at 150th Street and Highway 13. The intersection was dangerous, had been the scene of a fatal accident, and was in need of improvement. The costs, estimated at $6.5 million were to be shared by Prior Lake and Savage along with $2.1 million from MNDOT. Prior Lake’s share of the total was to be slightly higher than Savages, because most of the work and necessary property acquisitions would fall within Prior Lake.

The January 21 story revealed that the project had gone $3.3 million over Prior Lake’s share of the total budget, with none of the additional costs, excepting $124,000 for a water main relocation, brought before, the Prior Lake City Council. In a December 29 memo to Prior Lake city officials, the project manager, Savage Public Works Director, John Powell wrote: “The work involved to build this intersection to MNDOT State Aid Standards was extensive and includes additional property acquisition (in Prior Lake), construction costs, and engineer design costs.”

Simply put, Prior Lake staff didn’t know what the costs were going to be up front, but signed on to the project, anyway, to comply with MNDOT standards and get MNDOT money to do the work—none of this without coming back to the council for a budget amendment or concurrence on the changes that were needed. From a needed, necessary improvement for Prior Lake, the project turned into an expensive boondoggle.

City staff didn’t do its job. It moved ahead on a project and allowed contracts to be let without nailing down the scope of work and the costs. That and it didn’t come back to the council when it was clear there were problems. Similarly, the previous mayor and council are at fault for not staying on top of the project and asking for reports as the work progressed. This is a $3.3 million dollar mistake that will fall on Prior Lake taxpayers. There should be consequences for those involved. It is the responsibility of the new mayor and council to conduct a full investigation, assign accountability and take steps to insure it never happens again.—that and come up with the $3.3 million to cover the additional expense.

And then there’s the school district and the story reported in the January 25, City Pages

Last May the district came before voters with a $150 million referendum proposal to, among other things, add classroom space to accommodate growing enrollment. There was, and is, no debate about the need for additional classrooms, but Citizens for Accountable Government, and a majority of residents, were alarmed by the expense, particularly when it included several million dollars for athletic facilities unrelated to the academic needs of students, yet promoted by various athletic groups that use school facilities for their programs and activities. There was also concern about the amount being paid to a consulting firm, Nexus Solutions, and the district’s relationship with that firm, particularly when the district failed to follow an open, public selection process that included a formal, written request for proposal, a written scope of work, a formal evaluation and a contract award based on a review of all proposals received.

Instead, the district’s process was an unstructured, back of the envelope operation. Professor David Larson of Mitchell Hamline School of Law is quoted in the City Pages article:

Without open public bidding for the original consultant and management contract, “it becomes that much harder to know what kind of deal you’re getting in the real world. If you’re going to profit from the work that’s going to be done, you have an incentive to provide the largest estimate possible.”

The referendum failed. Yet the school board and the staff persist with denials about the Nexus contract and have refused to chart a different course. Nor have they come to the community with an apology for how they promoted the unsuccessful referendum. Nexus has already been paid $8.9 million and remains on the project.

Where is the accountability if the next referendum fails? The City Pages article is on the CAG website. Read it and then decide.