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Q&A on station cost overruns with Daniel Bunn

Medford city Councilor Daniel Bunn answers questions about cost overruns for a new police station and three new fire stations.

Why was the steel structure erected on the police station before the full cost of the project was known?

The city wanted to get a head start on site work and structural steel because it received what it considered a good bid. “This is not an uncommon practice,” Bunn said. “We saved a decent junk of money ordering the steel early.” Given the budget shortfall, Bunn said, it’s possible the city could put the rest of the project out to competitive bid.

There have been reports that subcontractors are charging up to 30 percent more than expected for work on the police station and three fire stations. Why wasn’t the city, the contractor or the architect more aware of this situation early on?

“I can’t answer that question,” Bunn said. In his own experience, he said he has seen construction bids going up about 6 percent a year. The City Council will be looking for answers at its noon and 6:15 p.m. meetings Thursday.

How confident is the city about subcontractors being the main reason for the cost overruns?

“Some members of the council are having a hard time swallowing that explanation,” Bunn said. As a result, he thinks councilors will ask some tough questions on Thursday. He said he will urge postponing a groundbreaking for the new fire stations next week until the city gets all the answers.

If the city delays starting the fire stations, isn’t there a danger the costs will continue to rise?

“That is one of the reasons to say let’s go forward right now,” Bunn said. “That’s our balancing act that we have to make.” The city could take out a loan to pay for the $5 million to $6 million shortfall or find ways to cut costs or scale back the projects. Bunn said the council will look at delaying the fire stations by three to six months in hopes of getting a more favorable bidding climate.

The city used what's known as the CMGC (construction manager/general contractor) bidding process in which the contractor, architect and city work together — which was supposed to provide cost controls on the station projects. Why wasn't the more standard competitive bid process used instead?

Bunn said he’s currently involved in a project in Roseburg with his own business that is using the CMGC bidding process. He said it’s good to have architects and contractors in the same room together discussing the design of the building. “Architects don’t build buildings,” he said. Bunn said it can be a useful way to build a project. However, given the current circumstances, he said the city may decide to go out to competitive bid on the fire stations and possibly on the remaining work on the police station. The city has the architectural and engineering drawings for all the buildings.

Why was the architect replaced in the middle of the design phase?

“For whatever reason, it wasn’t working,” Bunn said. He said he couldn’t go into details but acknowledged shifting architects cost the city time in getting the project to the point of construction.

— Damian Mann