Oddo, Borelli and Matteo Join Malliotakis As They Call for Common Sense Solutions

Assemblywoman Nicole Malliotakis the common sense alternative to Bill de Blasio in the race for mayor, held a Thursday morning news conference in front of the Animal Care Center of New York, 3139 Veterans Road West in Staten Island to discuss the flawed process by which the NYC Department of Design and Construction (DDC) manages capital construction projects. Joining Assemblywoman Malliotakis at the news conference were Staten Island Borough President James Oddo and Councilmen Joe Borelli and Steve Matteo. Malliotakis cited the Animal Care Center as “A perfect example of a delayed and over budget project that the DDC has become famous for.”

Ground was broken for the construction of the Animal Care Center in 2013. 4 years later the project sits uncompleted and at least $5,000,000 over budget.

Assemblywoman Nicole Malliotakis said, “We are standing in front of the Animal Care Center of New York, an example of the flawed DDC management process that continually produces projects that are completed way behind schedule and way over budget. If you want to see how time and tax dollars are wasted, simply look at this project.

“The Animal Care Center was started by animal lovers who hoped to create a state of the art animal shelter from which families and pets could be matched together. The original cost of this project was $3.1 million and like so many other DDC projects, the cost ballooned to $8.2 million dollars. Worse yet, ground was broken for this project in 2013 and as you can see, 4 years later, it remains uncompleted.

“In April of this year, the Center for an Urban Future in collaboration with the Citizen’s Union, released a report called Slow Build which offered solutions for managing capital construction projects. I believe the findings in that report are relevant to this project and several of the solutions offered should be adopted by the DDC.

“DDC currently uses one of their approved architects to design a project and provide a bid assessment. Only after the project is designed does the DDC bid the project out. Once a project is put out to bid, the price tag is adjusted to reflect the actual costs and the lowest bidder is chosen. If the contractor runs into unexpected cost overruns, a negotiation begins between the contractor and the DDC which often results in job stoppage until an agreement can be reached. When contractor is a small and unable to float the expenses of the project while waiting for payment, they often descend into a financial crisis that can often lead to bankruptcy. What this means is, if a contractor wants to do business with the city they must have deep pockets and be able to carry the cost of construction until disputes are settled; ruling out many of the companies enrolled in NYC M/WBE Program.

“Today, Borough President Oddo and Councilmen Borelli and Matteo join me, as we call for New York City to adopt a more common sense approach to building capital projects. Currently, I’m the cosponsor of a bill in Albany that will bring design build to certain city projects and which is estimated to save 6% on project costs and cut up to 24 months from the project’s time-line. Among its key points are:

– Work with the State Legislature to allow New York City to adopt a holistic approach to design and construction by permitting the use of Design/Build for certain projects. Current state law mandates a less efficient approach to completing construction projects whereby design work and construction work be bid out, awarded, and completed separately. This requirement is counterintuitive to the intent of protecting taxpayer money because the process requires that the project be designed by architects who have been pre-approved by the DDC. Once the design is accepted and a projected cost assigned to the project, the construction of the project is put out to bid. More often than not, the architects projected cost is much lower that the bids provided by contractors – putting the project over budget before shovels hit the ground. If the project requires changes due to unforeseen circumstances, additional costs and delays are incurred. The private sector and certain New York State–funded projects utilize design/build to reduce delays and control costs. By teaming up architects with contractors during the project bid process a more realistic cost for the project will be offered. This process will also expand the pool of bidders capable of completing the job. Smaller Minority/Women/Disenfranchised Business Enterprises will be more likely to submit a bid when they are part of the process from the onset where they can truly understand the work needed to complete the job.

– Include all relevant agencies in the design review process to reduce the time it takes to begin the project. By including agencies such as Fire, Transportation, Public Design Commission etc. at the onset of the process, it will reduce costly delays.

– Award projects to the lowest responsible bidder rather than to the low bidder alone. Awarding the bid to a contractor who is capable of completing the project and who has offered a reliable, cost effective bid will save taxpayer dollars and reduce project delays.

– Adopt a standardized set of rules to be used by all city agencies that have authority to review and approve costs related to projects. Utilizing a standardized review process will make it easier for contractors to understand the payment process which will help them: properly estimate the manpower needed to gather assemble the documentation necessary to correctly invoice the agency; reduce project delays due to non-payment of invoices which can easily bankrupt small M/WBE contractors; expand the pool of eligible bidders to ensure that agencies receive truly competitive and accurate bids.

“This city is world renowned as metropolis where builders reach for the sky every day. It boggles the imagination that in a city with some of the most talented people in the construction industry, that a project as small as the Animal Care Center of New York cannot be completed on time and on budget.”

Staten Island Borough President James Oddo said, “I have been wrestling with DDC on specific, individual projects since I got to Borough Hall, and every encounter has lead me to one conclusion, which I have professed privately and publicly time and again during my first term: the City of New York has, for a long time, been awful at building projects on time and on budget. DDC is the worst culprit, and there needs to be systemic changes made within the agency and across the board to improve how the city builds. It should not take New York City nearly a decade to finish a straightforward intersection widening. There are some really good people within the agency, but there are also many who have no sense of urgency and who believe they will outlive the tenure of current elected officials and don’t particularly care if particular infrastructure projects are the only modicum of relief beleaguered Staten Island motorists have. The change needs to be swift, comprehensive, and relentless, and the replacement process needs to be intelligent and steered by the power of leadership up and down the agency’s command structure. Anything short of that and the current culture wins. Nicole is promising that sort of change, and as a guy who is in the trenches fighting this fight daily, it can’t come soon enough.”

NYC Councilman Joe Borelli said, “This is an issue that will compound itself every year until a significant reform of the capital process is undertaken. The money we are paying to service the city’s growing debt is problematic in its overall amount, but more so in the fact that most of our funded capital projects exist as drawings on paper and not as concrete and steel amenities.”

NYC Council Minority Leader Steve Matteo said, “The main purpose of an agency like DDC is to manage city infrastructure efficiently, to streamline the process so projects are completed on time and on budget. Instead, DDC adds more layers of bureaucracy, resulting in lengthy delays and exorbitant cost overruns. Studies have determined that the average city-managed project costs more than twice as much as a similar project in the private sector. Our taxpayers deserve better. Our city can do better. We can no longer afford to build this way. We need to reform this process and this agency now.”

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