July 27, 2013 by Omar Passons
This fall, the City will hire a sort of “building doctor” to give many of its buildings a check-up. Just as we should go to the doctor regularly to get a physical, the City needs to have its own “doctor” give our City-owned buildings a physical. We own billions of dollars in buildings and other facilities around town, so it is probably a good idea that we occasionally check on their condition. The Public Works Department, thanks in large measure to the Infrastructure Sub-committee, finally has money to do another “check-up” (called a ‘condition assessment’) and there are some aspects of that process worth keeping an eye on. Let me explain…
Background: Hiring a “doctor”
First, just a basic point. The City can’t just run out and hire anyone to do this type of big project. It’s like if you were going to get carpet installed, you’d go get a few estimates to make sure you got the best value – some combination of price, skill and ability – right? Well the City is doing the same thing, it’s called a Request for Proposals, which is really just a fancy way of asking multiple companies to give their estimates. Technically it’s a little different because instead of asking “how much can you replace my carpet for” it’s more like asking “how good of a job on my carpet can you do for $1,000?” There are pros and cons to each approach, but that’s a side point related to what’s called project delivery that I’ll take up another day. The reason I bring up the Request for Proposals (“RFP”) is because that’s where you find all the real information about what the City intends to do. All the lovely sound bites and news clips in the world aren’t as useful as the RFP if you want to understand what’s really going on and that’s because the RFP tells you exactly what the company will be required to do. If you read the RFP, you can ask all sorts of questions about the work, why certain choices are made, and how the scope of work to be done does or does not meet the needs we have as a City.
In the case of checking on the condition of our City-owned buildings, the City has released an RFP. Thanks to the magic of Twitter, I was able to navigate through a bunch RFPs (here) to the one for our our City-owned buildings and other facilities.
HERE IT IS! RFP for Facilities Assessment – 2014 San Diego
There is much to be said about this RFP, not the least of which is that it is LONG. I mean really, really long. 130 pages long. And not “page-turning, nail-biting” pages, either. More like “paint-drying, sheep-counting” pages. This is the type of work someone really earned their salary to produce. There’s no way most reasonable people would take the time to read it all. I didn’t. But fortunately since I’m a public works and land use attorney anyway I know what to look for. Everybody wins! I can’t possibly get into everything that might be interesting, so instead I’ll highlight a few key provisions and why I think you ought to pay attention – and maybe even submit a public comment online here (Item #9 – meeting date 7/31/13) or attend the next Infrastructure Sub-committee meeting on July 31st downtown at 6PM (Details – Infrastructure Committee Agenda 7-31-13) and give your feedback.
Important Things I Noticed
First the good…
1. On page 85 the RFP reads “A Condition assessment is valuable only if: (1) the data accurately reflects the funding needs for each facility and (2) the information system provides a tool for all levels of an organization to develop and execute a strategic plan.” (emphasis is mine)
A-freakin-men! Think about this for a moment. This is our government acknowledging both that simply spending money won’t get us anywhere and that we need good and accurate data provided in a way that we can actually, well, use strategically. Yes, haters, now is the time to acknowledge that this is exactly what we expect out of our government.
2. On page 86 the RFP reads in reference to the Facilities Condition Information System “…to update information for continued use in identifying deficiencies and developing maintenance, repairs, rehabilitation, and capital replacement projects.” And notes that it should be a self-contained, fully integrated system
Word. Remember that time you had to hire someone to come back once a week to show you how to use the new equipment at work? But half the time they were sick or over-charged you because you called after hours? This is not that. This information system has to be self-contained, which basically means we won’t be getting ripped off with all those hidden extra charges that vendors like to hit you with. And it has to be fully integrated, which is a fancy way of saying that you have to be able to actually use the thing within all your other systems and not have to hope that the guys speaking French in the maintenance department can communicate with the guys speaking Russian in the contracting department! Woo-hoo!
And now the not-so-good
1. On page 84 the RFP reads “The lack of funds to launch an optimal facility renovation and/or repair program has created the necessity for a more modest facility renewal program.”
Screeeech. Why the Face!?! Hold up, wait, are we waiving the white flag before someone even draws a sword? Think about what this sentence might mean. We don’t have the money in the bank for an optimal program so we are making the choice not to get more money but to essentially aim lower. Huh? This is no bueno. If we start with the view that we lack the resources for an optimal program before we even know how bad the situation is, then we are essentially institutionalizing a lower standard! Why don’t we start with what we take “optimal” to be. I wrote about this issue as it applies to service levels here. Shouldn’t we as a city collectively decide how fast or slow we want to fix the stuff that’s broken? Shouldn’t we decide if selling some of that broken stuff at a discount to both clear the maintenance obligation from the books and make some money is a reasonable approach for some property? (Example: If I have a bike that will cost me $200 to get in working condition, I have a $200 liability for one of my assets. But if I sell that bike for $50 to a bike shop I both have an additional $50 plus I don’t have that $200 maintenance liability any more, right? Of course, if I NEED the bike, there’s a problem, but that’s something I can factor in). These are policy decisions that ought to be discussed, not just conceded.
Similarly, we as a city ought to decide if we want more cash to pay for these things or more credit (or some combination). That is, we might decide it is most prudent to buy everything with cash. On the one hand, that’s kind of like buying your house in cash. It doesn’t make sense because you’ll have it a long time and you can spread out the cost. On the other hand, borrowing money ain’t free, so using cash limits the interest we have to pay. As it applies to a city, buying with cash means using tax dollars – and in this case probably raising tax dollars – and buying with credit means getting a bond. Sometimes bonds can be good because you don’t have to pay it all back right away if your salary (tax revenue) is too low to pay in cash. The downside, though, is that it makes someone else down the road at least partially responsible for things we are using. Or, more accurately, it makes our kids responsible for things we and our parents already used and just failed to fix.
This notion of building our assessment on the assumption that we lack the money to pay for it seems like a dangerous way to go. I hope to get more information about this one from Councilmember Kersey’s team and the Department of Public Works soon.
Final Note on Facilities Condition Index
One of the ways that our “building doctor” will let us know how each of our buildings is doing is by having a standard measure for each building (or facility). This is called a Facilities Condition Index (FCI), which I believe equals the cost of repairing something divided by the replacement value of that thing. Two questions pop up immediately:
1. When the formula includes the cost of repairing something, to what level of quality is it being repaired? Is it repairing “like new” or perhaps “good enough to get me to work?” Seems like that could impact the index number.
2. Is FCI the best/only way to rank the priority of fixing things? How do we account for something that maybe has a low FCI, but has been in bad condition for a long time or is in a neighborhood that rarely gets its stuff fixed? I can’t tell off hand if the FCI is one factor in deciding what to fix or is the primary factor in making that call. Again, for this one I’ll be asking around. Feel free to respond if you know the answer. Citations to documentation always welcome 😉
Thanks for reading. Oh, if you want to give input on what projects ought to be fixed or built in your neighborhood, check the next post down on my page. Cheers