THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Wednesday, October 9, 1996 TAG: 9610090002
SECTION: FRONT PAGE: A12 EDITION: FINAL
TYPE: Editorial
LENGTH: 66 lines
The city of Chesapeake's recent selection of Armada/Hoffler Holding Co. to build a publicly financed $9 million conference center probably was legal, but the bidding process did not ensure that taxpayers got the best possible deal.
The city seemed more intent on Armada/Hoffler's getting the contract than on the city's getting the best bid.
Suspicions that this was not your normal arms-length bidding process are inevitable given the following:
Armada/Hoffler advised the city in its preparation of ``requests for proposals,'' which typically describe a project's size, location and general requirements and which are issued to create competition among contractors.
The city conducted a cheap, short, low-profile search for developers for the center.
Armada/Hoffler was the only company to submit a bid, which was accepted.
The whole process was high speed, despite three council members' pleas to slow down.
Thomas J. Lyons Jr., who had an option to buy the lot where the conference center will go and who stood to make money on the deal, backed out, saying that there was an appearance of a conflict of interest.
The city agreed to pay Armada/ Hoffler, which owned the 5.5-acre site, twice the land's assessed value, if the city eventually buys the center rather than lease it. The price, however, seems in line with other recent Greenbrier land sales.
No city official could or would say who wrote the original request for proposals. On something as important as a conference center - a milestone in the city's growth - the author of the request for proposals should not be secret.
Donald Z. Goldberg, Chesapeake's director of economic development and executive secretary of the city's Industrial Development Authority, said Thursday that he was ``fairly certain'' the city attorney's office drafted the original request for proposals. ``They must have,'' he said, ``because I didn't do it.'' Neither did anyone on his staff, he said.
On Friday, Goldberg said he was unsure where the original document came from.
Martin M. McMahon, who handled the conference center bid document while Chesapeake assistant city attorney, said, ``I didn't write the first one.'' He is now county attorney in Montgomery County.
W. Greer McCreedy II, an attorney for the Industrial Development Authority, said last week the document originated with the authority, but he couldn't identify who gave it to him.
The original request for proposals said the center should ``be adjacent to a full-service hotel facility with a substantial number of rooms.'' The description apparently narrowed the location to land near Holiday Inn Chesapeake. Armada/Hoffler owned such land. In fact, the conference center will be built on that lot.
The request for proposals was later broadened to say the center should have ``easy accessibility to hotel accommodations to meet the demands of a facility of this size.''
It is understandable that the city would want a developer with a track record as good as Armada/Hoffler's to build its conference center. That firm has been an important corporate citizen in Chesapeake for 17 years.
Still, if City Council believes everything done in awarding the center contract to Armada/Hoffler was aboveboard, the board needs to be raised. More than one bidder should have been found. And the city's relationship with Armada/Hoffler was too cozy.
A key question remains: Who wrote the original request for proposals? Until that question is answered, suspicions will only increase. by CNB