Once again, Kreger questions city purchasing

  • Fernandina Beach Vice Mayor Len Kreger says the city is not following its own policies regarding purchases. Kreger says the city may not be getting the best price for products and services because it doesn't seek bids from vendors. METRO CREATIVE CONNECTION
    Fernandina Beach Vice Mayor Len Kreger says the city is not following its own policies regarding purchases. Kreger says the city may not be getting the best price for products and services because it doesn't seek bids from vendors. METRO CREATIVE CONNECTION

Fernandina Beach Vice Mayor Len Kreger has again questioned whether the city follows its own purchasing policies. The issue this time is the process it followed to buy some water meters.

The $210,860 purchase was awarded to Sensus Services via a “sole source” contract, meaning it was made without going through a bidding process because Sensus, the city says, is the sole company that can supply the product. The meters are unique to the city’s water system.

Kreger said that, while Sensus may be the only company that makes the product the Utility Department uses, there are other companies that sell the company’s meters. As an example, Kreger said he located another company, Ferguson Plumbing in Jacksonville, that sells the Sensus meters. Since the purchase is more than $20,000 and the product can be obtained elsewhere, Kreger reasoned the purchase should have gone through a bidding process.

Utilities Director John Mandrick said he researched the issue and explained that Clay County went through the bid process for Sensus meters with Sensus being the only company that responded to an invitation to bid. He said the city does do business with Ferguson, but that it costs 23.3% less to get them directly from Sensus, “a significant amount of money.”

“Bidding doesn’t necessarily get you the best price,” Mandrick said. “In my opinion, going this route (with Sensus) is the most cost effective and timely way to get these meters. Ferguson doesn’t right now have these meters; they have to go to Sensus the way we do, so why involve another party when we can go directly to the manufacturer?”

Kreger maintained that the city should follow a bidding process, saying, “We do not know what the bid prices would have been.” “If we are going to have a purchasing policy, let’s use that purchasing policy,” Kreger said. “I don’t question what (Mandrick) is saying, he may well have the best price. But we have a purchasing policy, and this is not consistent with that policy. We are opening the door for everybody to negotiate, and in the end we will get burned.”

The commission approved the purchase 4-1, with Kreger casting the dissenting vote.

City Attorney Tammi Bach said the purchase is “completely legal” but that the information provided by Mandrick, if included in the purchasing process, “would have been helpful.” She said she would work with the city’s Finance Department to shape the city’s purchasing policy to address concerns.

The City Commission discussed how the coronavirus pandemic is affecting the city. Commissioner Mike Lednovich gave the latest numbers from the Florida Department of Health, which showed that “we did have a better two weeks,” although both the death rate and positive tests in the 15-24 age group have been rising.

Lednovich said he had received a complaint that there had been an outdoor sporting event in the city where guidelines were not followed. The person who made the complaint said they called the police. That call went to the county’s emergency dispatch system, Lednovich said, and no action was taken on the complaint.

City Manager Dale Martin gave the commission an update on funding from the Coronavirus Aid, Relief and Economic Security (CARES) Act. Martin said the county has provided the city with a sub-recipient agreement that will be on the agenda for approval at the next City Commission meeting.

After the agreement is approved, funds that are received by the county can pass through to the city. Those funds will reimburse the city for the money contributed to local non-profits, $250,000, since the pandemic began.

The commission approved an amendment to city code that will make it easier to enforce ordinances created under the city’s emergency powers. The amendment also addresses the state of emergency process so that the mayor and city manager can declare a state of emergency, if they agree to do so. That is what happened when the current state of emergency was declared in the face of the coronavirus pandemic, but now the process is set forth in city code.

The amendment also gives additional power to the police, code enforcement, and police auxiliary officers to enforce ordinances during a state of emergency, such as requirements to wear face masks and follow any curfews. The amendment also provides for a civil citation process so that enforcement, violation notices, fines, and other issues involving violations of emergency orders are all dealt with in the city, Bach said. The amendment passed on first reading and a second will be scheduled.

Martin updated the commission on the contamination in Escambia Slough. Testing of the slough has shown elevated levels of E. coli, which can come from human waste, and the city has been working with the Florida Department of Health to find the source.

Martin read a letter from Michael Godwin, FDOH-Nassau’s environmental health director, who said the department investigated the list of residences in the area the city suggested could have failing septic systems, and Godwin “believes” they have found four residential properties that are a “sanitary nuisance.” FDOH will notify the property owners and they will have to apply for a permit to tie into the city’s sewer system, if it is available, or install a new septic system if it is not. It is the responsibility of the property owner to contact the city to find out if sewage service is available before a septic permit is issued. Bach said “available” is defined by city code and state law as having the sewer line abut the property, and the city’s sewer lines do not abut the area where the septic systems appear to be failing. Bach said the city has to give the property owners a year to connect to the city’s sewer system if it is available. Martin said the city is working to define what is involved with a sanitary nuisance, and will determine the best course of action to follow.

The changeover of management at the city-owned Fernandina Harbor Marina from Westrec Marinas to Oasis Marinas was approved earlier this month, and Martin said Westrec Vice President Jim Fry has reached out to Oasis to ensure a smooth transition.

Fueling services have not been available at the marina since Hurricane Matthew hit in October 2016, and while fuel was slated to begin flowing this month, leaks were discovered in the fuel lines. Martin said a company has been contracted to pressure test the fuel lines, and determine whether they need to be repaired or replaced, at a cost of $1,700. The testing should be done by the end of the month. 

The City Commission approved, on first reading, a schedule that sets fees for various city services, such as water and wastewater services, parks and recreation fees, some impact fees and fees for airport services. The ordinance, however, will not set fees for the Fernandina Beach Golf Club or the Fernandina Harbor Marina. A second reading will be scheduled.

Commissioner Chip Ross said the golf club and the marina are operated by management companies, so those companies need discretion to set fees according to market conditions, such as a higher rate when there is more demand. The fee schedule was passed unanimously with the exception of the golf course and marina.

Ross said the Ocean Highway and Port Authority heard from Chris Ragucci, port director and port operator, that he is moving forward with plans to erect a fabric building to be used as a warehouse on port property, which is within the city limits. Ross said Ragucci told him the building permit and impact fees the city would require for the building are too high (more than $25,000) so Ragucci plans to erect the building without paying them.

OHPA and Ragucci maintain that, according to the charter for the Port of Fernandina, the port is exempt from city codes, while the city says the port is not exempt from state law and Florida Building Code that requires permitting before erecting the building.

Bach said she has already sent OHPA attorney Jeb Branham one letter about the building, and will send another assuring the port that the city is prepared to move forward with legal action if construction on the building begins without the permits.

The preapproval of the purchase of three new vehicles by the city passed, with objections by Lednovich. He said the current vehicles each had no more than 50,000 miles and that, during the financial crunch created by the coronavirus pandemic, the city should not replace them. Kreger agreed, but did not vote against it, explaining that the commission was not approving the purchase itself, but agreeing to it before the budget is approved in order to allow the purchase to go through after the budget is approved. The commission will vote Sept. 22 on that budget, and Kreger said he hopes the city will rework the budget to save money, including reconsideration of the purchase.

In other business, the City Commission:

• Approved the disposal of surplus property;

• Authorized the city attorney to engage outside counsel, if needed, not to exceed $50,000 for the 2020-21 fiscal year;

• Authorized wastewater, refuse and storm water fee exemptions for 27 accounts, totaling $24,429;

• Approved the extension of water services and a voluntary annexation agreement of property at 743 Pelican Lane;

• Approved grant agreements with the Florida Department of Transportation for runway maintenance, hangar construction, and rehabilitation of the fuel farm at the Fernandina Beach Municipal Airport;

• Approved two legislative priorities to be sent to state legislators – funding a grant from the Secretary of State’s office that would fund work on the Peck Center and revising the charter of the Port of Fernandina;

• Approved amendments to city code pertaining to permits; and 

• Approved a pay and classification plan for city staff.