THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Friday, September 27, 1996 TAG: 9609270517
SECTION: FRONT PAGE: A1 EDITION: FINAL
SOURCE: BY MAC DANIEL, STAFF WRITER
DATELINE: CHESAPEAKE LENGTH: 108 lines
The chairman of Armada/Hoffler Holding Co. said Thursday his company offered the city informal advice on putting together a proposal asking for bidders on the Chesapeake conference center.
But, Daniel A. Hoffler said, his construction company did nothing to influence the way the request for bids was written, what companies should be asked to bid, or how the decision to award the bid should be made.
About two months after requests were sent out, Armada/Hoffler, the sole bidder, won the contract.
``The thing was not . . . home-cooked,'' Hoffler said.
``We're not afraid of the facts,'' he said. ``We want the facts to come out.''
Chesapeake-based Armada/Hoffler Construction Co. is the state's largest commercial contractor.
Cities issue ``requests for proposals'' to create competition among contractors and provide taxpayers with the best builder and a fair price. Such requests include a project's specifications and the city's requirements.
In the case of the $9 million conference center, the requests for proposals were sent on a tight deadline, according to documents from the Chesapeake Industrial Development Authority.
In addition, some requests were made to businesses that do not build conference centers.
Also, the city's economic development director said, the development authority never nationally advertised the conference center request. Instead, it used electronic mail to send requests out on the Internet's World Wide Web through a third party. At least one of the companies the city listed as having contacted doesn't have Internet access.
Louis S. Haddad, president of the Armada/Hoffler Holding Co., said the the advice came during informal talks between city officials and members of the staff at Armada/Hoffler. According to Haddad and Hoffler, the conference center project was to be the first time the Chesapeake authority had put out such a proposal, and was the first time officials asked Armada/Hoffler for advice.
Both men said that their business puts them in frequent contact with city officials on a wide array of economic development issues. For example, they said, officials in Norfolk had occasionally asked company officials for advice.
Neither man was sure whether their company had won contracts from Norfolk after giving advice, but they said it was a reasonable assumption.
Hoffler and Haddad said that certain members of the City Council and city staff are actively working to undercut the agreement between the city and the construction company. Although the council on Sept. 17 agreed to move forward with a lease for the conference center, the final contract isn't scheduled to be signed until Thursday.
``We know, specifically know, that there are people here who have another agenda,'' Hoffler said.
A. Russell Kirk, vice chairman and CEO of the Armada/Hoffler Holding Co., said Thursday that Armada/Hoffler never saw the request for proposals before it was officially released and didn't influence its final outcome.
Greer W. McCreedy II, attorney for the Industrial Development Authority, said he did not know if the matter was ever discussed with Armada/Hoffler officials.
McCreedy said the document was drafted by the city attorney's office and sent back to the development authority, where it was later approved by the authority's board after some minor revisions.
McCreedy said that the document was drafted by the development authority staff. He said he didn't know precisely who prepared it.
Donald Z. Goldberg, Chesapeake's economic development director, was unavailable late Thursday. Earlier in the day, he said McCreedy and the city attorney's office had prepared the document.
City attorney Ronald S. Hallman said his office received a working copy of the request for proposals via fax from McCreedy on May 6. One of Hallman's assistant city attorneys rewrote the document to comply with the city code and sent it back to McCreedy on May 9.
The IDA's formal request for proposals for the conference center was completed May 9. The IDA board of commissioners approved it May 15. The deadline for receiving replies was listed as June 28.
The IDA advertised the request for proposals in The Virginian-Pilot and the Newport News Daily Press on June 1, 15 days after it was approved and 27 days before the deadline.
Officials in the city's public works department - the construction arm of city government - said they were first contacted about the conference center project on Aug. 16.
Goldberg said the request was never nationally advertised because it was too expensive.
Although it is not required under state procurement laws, such requests are often advertised nationally to get the best price for the project.
The development authority got in touch with the International Association of Conference Centers via the organization's World Wide Web page on the Internet. Using that page, the authority sent e-mail messages containing the request for proposals to about nine or 10 companies, Goldberg said.
The e-mail messages were all sent on June 10, 18 days before the deadline to make a proposal. Most were not sent directly to the companies but via the International Association of Conference Centers.
The city sent an e-mail message to at least one company - Philadelphia-based ARAMARK Conference Center Management - that doesn't have e-mail or access to the Internet. An official for the company's conference center office in Radnor, Pa., said Thursday that they had never received Chesapeake's request.
``We e-mailed the proposal to them not knowing if they do these or they don't do these'' conference centers, Goldberg said. ``We tried to get this out to as many people as we could who are in the business or have some relationship with the business. You never know who might have an interest in doing this.
``I feel we went above whatever were the standards,'' he said. ``Whatever the standard procedures were, we feel that we went beyond them. We wanted as many people to respond to this as possible.''
KEYWORDS: CHESAPEAKE CONFERENCE CENTER CONTRACT BIDS by CNB