High number of Capitol Square Project bid waivers raise questions

In anticipation of the occupation of the strip mall for this year’s legislative session, popular radio show host Chuck Gray explored the highly controversial Capitol Square Project recently with political pundit Kevin Lewis. The two discussed the unusually high number of what appear to be unconstitutional bid waivers at a time the legislative leadership is seeking higher taxes.

Lewis had started digging into the contracts of the Capitol Square Project after a friend inquired about the bidding process for a Wyoming Game and Fish contract. What he found on the Department of Administration and Information website, led to him down a rabbit hole filled with bid waivers and sweetheart deals. “Often times, State government is a little strange about the way it words contracts. If they have somebody picked out, they will do all kinds of things to make sure that person gets picked. They’ll run a Request For Proposal and they’ll do it very quickly so that only one person who is up to speed ahead of time can answer that and that was the case in the Game and Fish,” Lewis told Gray. “When I investigated that, the person at A&I procurement, the Administration and Information procurement division said ‘Kevin you really need to look at our sight. We’ve got some new things on the site,’ and when I went to the site – they did.”

Listen to Part 1 of the interview here

Listen to Part 2 of the interview here

“They had – based on legislation – added a portion about bid waivers. So, you can see every bid waiver for this biennium on the Department of A&I procurement site. When I started looking at the bid waivers there is a lot of them. A huge amount of bid waivers. In other words bidding was waived for over half a billion dollars in state government in this biennium. And that does not include the Wyoming Department of Transportation, Wyoming Business Council, UW and LSO,” continued Lewis.

According to Lewis, Wyoming law requires government projects to be subject to the bidding process in order to secure the lowest possible cost. Lewis explained that while it is not always possible to put a project up for bid; bidding should be the exception – not the rule.

Oversight of the project is managed by a committee of a small group of legislators. “In 2014 a bill was passed for that oversight committee,” explained Lewis, “and we have four senators, four representatives. The senators are: Eli Bebout, Phil Nicholas, Tony Ross, and Chris Rothfuss . The representatives are Rosie Berger, Kermit Brown, Tim Stubson and Mary Throne. So on that list you have six attorneys and two engineers.”

What was supposed to be a $50,000,000 project has swelled “into well over $250,000,000 in bid waivers,” according to Lewis.

Lewis offered the temporary facility across from the county courthouse as just one example of questionable bidding. “Wyoming tried to bid the elevators. It was awarded to one contractor Thyssen Krupp. Well, they actually bid it twice and it was originally awarded to a company called Kone, and the owner of the building said he didn’t want those guys. So essentially it was not a bid of contract at all. That particular building has had many changes to it done by the state, $1.7 million to J.E. Dunn to do construction in the building. The elevators were $409,000. The fire and security systems were about $560,000. Lots of trim and side work and overall we’ve spent pretty close to more than the entire lease on that building’s improvements.”

“The process really started back in 2003 on a budget footnote. The fund was set up to start receiving savings to do the renovations,” said Lewis. As a result, officials started earmarking certain funds and set up the oversight committees. ‘The committees actually do do a lot of oversight. You can see a lot of evidence associated with the contracts where they are approving various contracts betting getting into the contract,” noted Lewis. “Often times the bid waivers are approved by Dean Fausset who is in charge of A&I. Sometimes it is Mell Muldrow, other times it is Suzanne Norton. So they are all part of that process from the governor’s side.”

Lewis told Gray that he scoured information provided by the State Auditor’s office, the Secretary of State’s office, and the Department of A&I. “You see all kinds of very interesting things going on. This morning I looked at one of the contracts and it had a change order in one of contracts before the contract was even signed. So change orders are a big part of this project,” said Lewis. “So somebody will bid it, then ask for change orders in it and often times get huge increases in the amount of money in their contract.”

Gray responded, “That is a huge problem because they can bid it at a smaller point and then just get the change orders to up the price of it.”

“Sure and the most egregious case was that the contract was for a million dollars and now it is over 27 million – that’s the architect,” answered Lewis.

The Wyoming state constitution, Article 3, Section 31 requires:

All stationery, printing, paper, fuel and lights used in the legislature and other departments of government shall be furnished, and the printing and binding of the laws, journals and department reports and other printing and binding, and the repairing and furnishing the halls and rooms used for the meeting of the legislature and its committees shall be performed under contract, to be given to the lowest responsible bidder, below such maximum price and under such regulations as may be prescribed by law. No member or officer of any department of the government shall be in any way interested in any such contract; and all such contracts shall be subject to the approval of the governor and state treasurer.

“That section is broken into three parts,” explained Lewis. “The first part is bidding; the lowest responsible bidder under the maximum price.”

The largest contract Lewis found was a construction manager at risk contract. According to Lewis that contract was awarded to, “J.E. Dunn and amendment 3 removes the maximum price and sets it aside and waives it way into the future. We don’t have a maximum price, and failing to bid.”

Gray asked about the fact that contracts are subject to the approval of the governor and state treasurer. “Now you’ve looked into the documentation and apparently the state treasurer has not approved any of what is going on,” said Gray.

“Not a single document,” responded Lewis. “I spoke with the state treasurer briefly. I sent him an email. He found it fascinating that that was in the constitution. I’m not sure how he wishes to proceed on that.”

“It is pretty clear what they are doing is wrong according to the constitution.” Gray asked, “Why do you think this is happening?”

‘That’s a very good question. From the very top level we learn in our basic civics class about the separation of powers, executive and legislative and judicial. This project has the governor as well as the oversight committee working together and it becomes a separation of powers issue. And the question is why would a citizen legislature provide so much oversight into contracts and even saying how things will be done in a contract; that a mover will take a piece of art and load it into a government truck and follow it to where it is going to be stored? It is amazing to watch this. Fascinating. I would have to imagine that there are some people that have interest,” said Lewis.