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The Lady L is one of two boats the city purchased to replace the water taxi service.
Jax Daily Record Tuesday, Jun. 17, 201412:00 PM EST

A look at the missteps with the water-taxi controversy

by: David Chapman and Marilyn Young

When Mayor Alvin Brown’s water taxi team announced Friday that the deal to buy two pontoon boats to preserve the service had fallen through, it was at the end of eight days of rough waters.

During that time, the administration had improperly spent $338,500 to buy the boats to replace the water taxi company that made it known May 23 that its last day would be June 6.

City Council members were critical of the purchase from the beginning, questioning whether water taxis elevated to an “essential” service, the trigger that allowed the boats to be bought as an emergency, without going through normal channels.

Even after an attorney in the General Counsel’s Office determined the emergency transaction was legal, the very next day that same lawyer stood before council members and called it an “unauthorized purchase.”

There were other issues throughout the process, including:

• The Request for Proposal took eight months, including more than two months in the risk management office where the primary work was rewriting an insurance section and adding an indemnification section.

• The city paid $212,800 for a boat that was listed for sale online for $159,995. The extra money, the city said, was due to repairs and additional work to be done, though emails show the first price quoted for the 102-passenger boat was $212,800, with the first mention of repairs (apparently at no charge) coming five days later.

• The last-minute decision by the administration to seek council’s permission to spend money that had been wired to the boat company the week before was lampooned by members who said it was a pattern of a lack of communication between Brown’s office and council.

• There was no signed contract for the boats. Only an invoice that was paid and a string of emails between Trident Pontoons and Karen Bowling, Brown’s chief administrative officer, who led the effort to find a solution to the water-taxi problem.

• The Baltimore company that received the contract in April 2013 had been operating since February without a signed extension, which the city’s chief of waterfront management and programming knew.

On Friday, the city sent a letter demanding its money back from the boat company because it failed to meet promises, including not delivering “operational and certified vessels” last weekend to ensure service wouldn’t be interrupted.

However, a review of emails shows the boat company owner said June 5 he would try (with try underlined) to make the Saturday delivery of the two boats the city had requested two days before, but he needed a commitment that day from the city.

Ultimately, the smaller boat was delivered to the city Thursday, the day after Bowling had asked the company in an email to “suspended transport and delivery effective immediately.”

She said Cunningham missed several deadlines along the way.

“Needless to say, we’re all disappointed,” Bowling said Friday. “We were trying to do the right thing. Trying to prevent a disruption in service.”

She said the next step is to re-issue the RFP (which could happen in a couple of weeks) and find a private company to provide the service.

That’s what council member Richard Clark has been wanting since the emergency declaration was made by the administration.

“Now we can start the deliberative process to find the right solution,” he said. “It’s a shame that once again the council has to step in to carry out the day-to-day operation of the city.”

Early delays

The delays with the water taxi date back to the eight-month RFP process. The proposal stayed in the risk management office for nearly 10 weeks.

From Sept. 26-Dec. 3, the only major changes came with the addition of a detailed indemnification section and the replacement of the insurance section. Both required substantially higher insurance requirements. For example, employer’s liability was $100,000, but increased to $1 million per accident in the risk management addition.

It then took nearly seven more weeks for the RFP to be advertised Jan. 15.

Procurement chief Greg Pease wouldn’t speculate why the RFP was in risk management for more than two months.

“Every RFP is different,” he said Friday. “Every RFP has its own set of complexities.”

Carrying people across the water is a difficult thing, Pease said.

Bowling said in her experience, 10 weeks in one office is not typical. She thought the office had to research new regulations that were required.

The Daily Record asked Thursday to interview someone in risk management who could address the specifics of the delay, but no one was made available.

Finding the boats

Bowling said the administration made calls to several marine businesses and licensed captains, seeking a temporary solution to get the city through the busiest time of the year Downtown.

Among the companies recommended was Trident Pontoons, who ultimately sold the city the Lady L and Sea Charm I.

Trident Pontoons owner Robbie Cunningham sold the Lady L, which seats 102 passengers, to the city for $212,800. The Daily Record found an advertisement for the boating on that listed the boat’s sales price at $159,995.

Bill Biggs, a broker at Yacht World, said last Monday the boat was under contract and was to be delivered Tuesday.

When asked if the $159,995 sales price was still applicable, Biggs said it was. He said the purchaser was not the city of Jacksonville but would not provide the name of the buyer.

When the Daily Record showed the listing to Bowling and several members of the administration last Monday, no one acknowledged having seen it before.

Pease said the price was for a wholesale boat. “We’re not buying a wholesale boat,” he said.

Bowling said Trident Pontoons was doing additional work, which is why the price was different. She said the city would request a breakdown of the costs associated with the additional work but didn’t have it as of Friday.

However, emails show Cunningham’s first price quote to the city for the Lady L came June 4 in a list with five other boats. The price was $212,800, with no mention in the email on any additional work or repairs.

Five days later, as Cunningham was describing the condition of the boats, he said the Lady L was in excellent condition “except for two Weblon panels on the roof and their bows, which I will replace.”

He also said the boat was missing an overboard light and “a couple of other small items for the Coast Guard.” There was no mention in the email of any additional charge for those repairs and items.

Council critical of communication

The last-minute communication about the administration’s plan to ask council at its Tuesday meeting to approve using money from the banking fund for the purchase didn’t sit well with many council members.

Chief Financial Officer Ronnie Belton said Tuesday night he decided June 5 to use the banking fund to finance the purchase of the boats and he knew it would have to go before council. Expenditures from that fund have to be approved by the council.

When asked why he chose the banking fund, Belton said, “because we had cash there.”

Tim Horkan, an attorney in the Office of General Counsel, said he was told Tuesday — the same day as the council meeting — the banking fund was being used to buy the boats. That was five days after Belton chose the fund as the source for payment.

It was decided then to go before council that evening and ask for approval to spend the money.

Council members learned at the 4 p.m. agenda meeting, an hour before the regular meeting, that the administration would be asking for the money.

Clark called the late decision “par for the course” for Brown’s administration. “I’ll get a phone call a week about an announcement to let me know 20 minutes before they decide to tell everybody,” he said.

Council member Don Redman was in nearly all of the meetings about the water taxi because it operates in his Downtown district.

He said he was told the weekend before the council meeting that the issue would have to go before council. He learned the morning of the meeting that it would head to council that night.

When asked after Tuesday’s meeting why council liaison Teresa Eichner hadn’t shared the information with council members, Bowling said, “She was sure trying.”

On Friday, when asked why the liaisons didn’t talk with council members sooner about the emergency legislation, Bowling said, “We just didn’t know it would be that fast or what the timing would be.”

She said they debated whether to present the legislation Tuesday or wait until the next scheduled council meeting June 24. But, she said, “If we say that it can wait, then we are saying, ‘No it really wasn’t an emergency.’”

Missing details

As Bowling talked about lessons learned, the first one she mentioned was the necessity to have a Plan B in contracts, especially those involved in providing services.

HarborCare of Baltimore had been awarded an extension in February as the RFP process was continuing.

“Tera (Meeks) can probably speak more to just the whole issue of, you know, if we had known that HarborCare hadn’t signed their seven-month extension, should we have started looking, getting on that sooner?” Bowling said Friday.

When asked why it wasn’t known that the extension hadn’t been signed, Meeks (chief of waterfront management and programming) said she was aware the extension hadn’t been signed.

She said there were ongoing discussions with the company, which wanted to change certain terms and conditions.

She said the city allowed HarborCare to increase fares and to decrease the amount it paid to the city. Despite those changes, the company still didn’t sign the agreement.

“I was very well aware of the fact they hadn’t signed it,” Meeks said.

She also was aware the company wasn’t reporting ridership figures, which is required by the Coast Guard and through the contract it originally received in April 2013.

“I believe they were at first,” she said. “I believe they tapered off.”

Another contract issue relates to the fact there was no signed contract with Trident Pontoons, only emails and phone calls to reach the terms.

When asked whether the email string would be legally binding, assistant general counsel David D’Agata said, “No it would not, it would not be legally binding. We’re a governmental entity, there is sovereign immunity that’s applied to governmental entity. There needs to be written contracts to be legally binding.”

He then praised Brown’s administration for doing the “responsible thing” and suspending the deal when the terms of the arrangement weren’t met.

When asked if Cunningham would be bound by the emails, D’Agata said, “Yes he is. Absolutely he is.”

Bowling said a positive sign throughout the process was the number of people who volunteered to help, including businessman Harry Frisch who has offered to pay for the boats.

[email protected]

(904) 356-2466

[email protected]

(904) 356-2466

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