March 22, 2017 Board Meeting Agenda Item #4 Independent Contractor, Professional Services, Field Service and Master Contract Agreements

MARCH 22, 2017 BOARD MEETING

Board Meeting Agenda at page 3 http://capousd-ca.schoolloop.com/file/1218998819331/1455438848279/576115885391746174.pdf

Board Audio at 140:40 http://cusd.capousd.org/cusdweb/audio2016-17/CUSD_BoardAudio_March-22-17.mp3

Vote to approve $409,700.00 Contract with AW Industries 5 - 1- 1 (Trustee Reardon Votes No Trustee Holloway is absent) and Trustees Voted to approve $29,677.08 contract with Rutherford Design without discussion.

Moved by Trustee Jones - 2nd By Trustee Hatton Hodson.

The Contract with AW Industries should not have been approved:

The contract did not go out to bid
Staff hired and Inspector of Record to work in-house despite stating on the record that this is not a normal process. Typically DSA will not let you hire an IOR as an employee because technically the IOR reports to the Architect so DSA considers it a Conflict of Interest for the IOR to report directly to the District.
CUSD normally contracts with Knowland Construction a broker of DSA Inspectors

Two Contracts totaling $439,377.08

AW Industries $409,700.00 Inspection services at Esencia K-8

SBCO Inc. dba Rutherford Design $29,677.08 New Sound System at San Clemente High School

Both of these Contracts were on the March 8, 2017 Board meeting Agenda. AW Industries was pulled and was suppose to be on the March 15, 2017 Special Board meeting Agenda, but was not. Rutherford Design was approved on the March 8, 2017 Board of Trustee Meeting. Why is it back?

at 140:40 PUBLIC COMMENTS

BLUE CARD Dawn Urbanek

On the March 8, 2017 Agenda Item #3, this was a $626,4500 contract with AW Industries for Inspection services for Esencia K-8 School.

I pulled the contract because it did not have the contact information for the company.

Some research showed:

Adam Watson is an individual DSA inspector that is listed on the Knowland Construction web site.

There is a corporate filing for an AW Industries Group Inc - A construction management business. Adam Watson is listed as Secretary. The corporate address is a personal residence.

There is no AW Industries on the web except for the corporate filing.

Agenda Item #2 contained a PO for $409,700. Both the PO and Contract were pulled and are being approved on the March 22nd Agenda.

On the March 22, 2017 Agenda Item #4 the Board is being asked to Approve a PO in the amount of $409,700.00 made out to AW Industries. This contract still has no contact information for the company, and 3 pages are missing including the signature page.

Comparing the two contracts, it appears that the March 8, 2017 agenda has two AW contracts: 1 for $409,700.00 for Inspection Services of Esencia K-8 and 1 for inspection services for Tesoro High School for $216,750.00 that is not included in this Agenda Item.

at 142:24 TRUSTEE COMMENTS

at 142:35 Trustee Reardon

Expressed concern about structure - hiring an individual for longterm commitment for an hourly contract. I have expressed my concern to staff. The contract specifies a "designated substitute" that is to be supervised by the person who is absent. This is an individual that happens to have a DSA License that happens to command a high hourly rate. I am concerned that there is nothing surrounding him.

at 144:00 Trustee McNicholas

Have you gotten any answers from staff?

at 144:03 Trustee Reardon

No - All I know is that the Contract has now gotten smaller. With the amount of construction CUSD is going to have, why don't we hire an in-house inspector?

at 1:44:38 Brian Carter

Friday up-date included this topic. IOR Inspector of record. DSA requires us to hire a DSA. Title 24 Regulations that must be followed. DSA provides a field representative from the State. They look at the Daily reports. If the Inspector does not have the latest Daily Reports and Semi-monthly reports that is a violation.

at 146:56 Trustee Hatton - Hodson

What was our process in hiring this particular Inspector?

at 147:06 Brian Carter

Our process was that we have had good experience working with this particular inspector who we previously hired through Knowland Construction Services. Knowland is a Broker of IOR's. We went through RFP process with Knowland. We reached out to individual DSA inspectors for this particular job and AW Industries gave us a great deal.

at 148:46 Trustee Hatton-Hodson

So we went out to bid on this contract? Do we require an RFP process for contracts above a certain amount?

at 148:58 Brian Carter

Typically Districts do use an RFP process, but for this specific project we did not do an FRP.

at 149:20 Trustee Hatton-Hodson

Do we have an RFP process for a certain dollar amount?

at 149:36 Brina Carter

I would have to defer that question to purchasing. But we did not do that for this particular project

at 149:44 Trustee Hatton-Hodson

We must have some sort of agreed on RFP process for contracts over a certain dollar amount.

at 149:58 Brian Carter

In the future we will use FRP Process.

at 150:29 Trustee Hatton-Hodson

So we do have some sort of checks and balances for this particular project?

at 150:33 Brain Carter

If there there are any issues, DSA can enforce and we can enforce.

at 150:46 Trustee Hatton-Hodson

We need a Policy that defines when an RFP is needed

at 1:51:06 Trustee McNicholas

I am not sure that is on our list of policies to review, we may need to add that.

at 151:17 Trustee Reardon

I am concerned about the Chain of Command and Supervision. When the Contract is with Knowland, Knowland keeps track of hours etc. How does this person account for $439,000 worth of hours?

at 152:00 Brian Carter

Inspectors turn into Daily Reports and a time card. They turn them in to me and I approve the invoices.

at 152:37 Trustee Reardon

In the event that this person became incapacitated how long would it take to find a replacement? With Knowland it would be seamless.

at 152:46 Brian Carter

This particular contract is not through Knowland- but if we had to go back to Knowland it would be a week or a couple of days. We would do whatever we had to do to keep things moving.

at 153:10 Clark Hampton

Or we could go to another firm like Knowland. we would do our due diligence and hire them as quickly as possible.

at 153:22 Brian Carter

In the future to alleviate this problem we will go out for an RFP and create a bench of firms that are already approved. It is our intent to tighten this up for the future.

at 153:47 Trustee Hannacek

Inspector of record- if we had a District that had a lot of work do Districts hire in-house?

at 154:29 Brian Carter

Typically DSA will not let you hire an IOR as an employee because technically the IOR reports to the Architect so DSA considers it a Conflict of Interest for the IOR to report directly to the District.

at 154:54 Trustee Hatton-Hodson

Where does this money come from"

at 155:12 Brian Carter

Soft Costs included in the Contract

at 155:18 Trustee Mc Nicholas

Are we ready to vote?

at 155:19 Trustee Pritchard

So you are the owners rep. A Construction management will be on site full time. I visit the site weekly.

at 155:45 Trustee Mc Nicholas

Entertain a motion?

Trustee Jones moves the Item

Second by Trustee Hatton-Hodson

Vote to approve $409,700.00 Contract with AW Industries and the $29,677.08 Contract with Rutherford design 5 - 1- 1 (Trustee Reardon Votes No Trustee Holloway is absent)

MARCH 22, 2017 BOARD MEETING CONTRACT AW Industries

Board Meeting Agenda at page 3 http://capousd-ca.schoolloop.com/file/1218998819331/1455438848279/576115885391746174.pdf

THERE IS NO CONTRACT SIGNATURE PAGE

The following pages have been deleted from the Item- Has the District already paid the $216,750.00 for inspection of Tesoro because that project is already under construction? This contract has never been approved by the Board.