Dana Point Harbor Contract Extended Five Years

Dana Point Harbor stand-up paddleboards (p)

Dana Point Harbor is in the midst of a controversial revitalization effort.  (Photo by: Flicker user "chanmelmel")

Orange County supervisors on Tuesday approved a $4.7-million, five-year extension of a controversial contract to oversee the massive revitalization of Dana Point Harbor, a project that’s long been mired in controversy and delays.

Under a 2003 project management contract that has been extended five times, Project Dimensions Inc. (PDI) has been paid an average of $834,000 each year so far. With this week’s approval, it will now receive as much as $1 million annually to manage the project.

According to county records, the contract was originally for $7 million  and scheduled to expire in 2008. It is now for $13.2 million and set to end in 2018.

Accusations flew at Tuesday’s meeting that county officials turned a blind eye to incompetence by PDI that allegedly cost thousands of dollars.

Bruce Heyman, president of Boaters for Dana Point Harbor, told supervisors that PDI submitted a land use plan to the California Coastal Commission that wasn’t formatted correctly.

The firm then spent the next five months correcting the submission at county expense, said Heyman.

“Why was PDI not held accountable? It was their expertise that was hired for the crafting of the LCPA,” said Heyman. “Good contract management would have held PDI accountable and forced them to correct the errors on their nickel, not ours.”

Supervisor Pat Bates, whose district includes the harbor, replied that concerns about PDI had been addressed by a county staff review.

“They have consistently performed in a manner benefiting the harbor,” said Bates, adding that questions raised by Heyman and a former policy aide to Chairman Shawn Nelson have been examined by several county departments.

PDI didn’t respond to request for comment.

The former policy aide, David Zenger, said he found a hornet’s nest of bad management and inefficiency by PDI.

“It is absolutely asinine. It is complete and total mismanagement,” said Zenger, questioning whether PDI is even qualified for the job.

Zenger, who was fired last week by Nelson after looking into the contract, said he couldn’t find any evidence that PDI has prior experience managing a large, critical public works construction project.

And he questioned why the contract has been extended from five years to 15 without going back out to bid.

“They have no incentive to get the project built on schedule,” said Zenger.

Chairman Nelson said Zenger’s dismissal was not related to his investigation of the PDI contract, adding that he valued Zenger’s work at his office.

"Dave and I were asked by Supervisor Bates to look into it," Nelson said, adding that the contract needed "lots of clean up to get it right."

Zenger also questioned why PDI’s contract was changed in 2006 so the firm got an automatic monthly payment regardless of the work they performed.

The staff report to supervisors incorrectly stated that the flat fee arrangement already existed, according to Zenger.

Several speakers on Tuesday praised PDI’s work, with Jim Miller of the Dana Point Harbor Association saying he’s been “consistently impressed” with the firm’s level of service.

The firm’s supporters cited PDI’s involvement in public outreach meetings and extensive knowledge of the project.

Supervisor John Moorlach questioned the monthly retainer structure of the contract, pointing out to Brad Gross, director of the Dana Point Harbor Department, that payments seem to keep increasing over time.

“I’m a little concerned, Mr. Gross,” said Moorlach.

Gross replied that the county was fully utilizing PDI’s two employees for the project — one paid $190 per hour and the other $78 per hour.

“They’ve been involved all the way through,” said Gross, pointing to PDI’s involvement with two environmental impact reports and more than 20 boater outreach meetings.

Moorlach ultimately said he was comfortable with the contract extension.

At the end of their discussion, supervisors decided that the contract extension should be structured with fixed time and materials, though it was unclear how that would affect cost.

Norberto Santana Jr. contributed to this report.

You can reach Nick Gerda at ngerda@gmail.com, and follow him on Twitter: @nicholasgerda.

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