Though they continue to approve the vast majority of her funding requests, City Council members both allied with and against Mayor Dawn Zimmer want earlier warnings and more information when costs of professional contracts and capital improvement projects increase. Three resolutions at recent council meetings were criticized for either expanding the size of a contract or introducing a new one without what some council members considered adequate notice.
Dog runs & overruns
At its meeting on Dec. 3, the council approved the first $81,000 of a planned $132,000 payout to Rich Picerno Builders to cover unanticipated repairs and improvements in its renovation of Elysian Park. Picerno’s initial city contract for the project, approved by the council in August 2013, totaled $907,805.
According to Health and Human Services Director Leo Pellegrini, $40,000 of that increase went to install irrigation, which the city decided was necessary given all the new foliage planted in the park. Another $27,000 was needed to deal with additional debris as the company dug up the old playground area, and $16,000 funded the interior of the park’s public bathroom. Additional funds went to edging on the dog run and along Sinatra Drive.
All the improvements funded in the change order presented this month have already been completed, a fact that did not sit well with Councilman Michael Russo.
“We’re talking about $130,000 of work that has been done before the proper approval,” said Russo. “If we all decided that this was something we didn’t want to do because we wanted to spend that $130,000 somewhere else, this city would be sued…”
Pellegrini said to seek council approval mid-project would have caused unacceptable delays and cost even more in the long run.
“When we’re renovating in the middle of the summer and you put in plants and I have no irrigation system, you’re going to waste another $40,000 when…I have to get new planting,” he said.
Councilwoman Beth Mason questioned why irrigation hadn’t been included in the original contract. Pellegrini noted that none of Hoboken’s inner city parks have irrigation, and speculated that the professionals “see what’s existing” and plan accordingly.
“You’re just saying, ‘write them a check for not to exceed $30,000’ and we’re supposed to rubberstamp that.’” – Ravi Bhalla
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But that standard wasn’t stringent enough for Russo. “This council deliberates in excess when it comes to our budget…so $130,000 is substantial in some regard.”
Ultimately, Wiest promised to look into an early warning system for unanticipated work on contracted projects.
The Picerno builders contract change order was approved by a vote of 8 to 1 with Russo in opposition. A second tranche of $51,000 covering the remainder of the Elysian Park cost overruns was pulled at the end of a grueling City Council meeting on Dec. 16 and will be considered again in January.
More money for note sale
At the Dec. 3 meeting, council members also questioned the increase of a contract with its municipal auditor, Ferraioli, Wielkotz, Cerullo & Cuva, by $11,500 to a new not-to-exceed amount of $131,500. The contract was approved, and council members Russo and Castellano voted in opposition.
According to Russo, Ferraioli’s contract with the city had been $89,000 only six years ago.
The Zimmer administration, said Russo, “continue to come back to the council [and] ask us to exceed those limits that we originally put in place.”
Wiest explained that the most recent increase paid for new auditing activities required after the city stopped selling its bond notes in the Hudson County Improvement Authority pool and started selling them on its own. This change, which Wiest said would save the city money, was made possible by the city’s improving credit rating, which reached AA-plus status with Standard & Poor’s last year.
At the same meeting, the City Council approved $25,000 more for the city’s bond counsel, law firm Parker McKay, also as a result of the new note sale. Both the auditor and bond counsel have to prepare parts of the city’s official statements for the sale, according to Wiest.
General contract, specific problems
While the City Council ultimately increased funding for the contracts related to both the note sale and Elysian Park, it pushed back on a funding resolution that members from both sides of the political divide criticized as vague, inaccurate, and potentially in violation of state rules on professional conduct.
At the Dec. 3 meeting, the administration sought a $30,000 contract for “Special Counsel –General Litigation Counsel” services with law firm Schenck Price LLP. Wiest said the city needed representation for mediation requested by a contractor for the Sinatra Park project, but was advised not to give further information in public by Assistant Corporation Counsel Alysia Proko.
Councilman Tim Occhipinti questioned why the contract couldn’t be fulfilled by Hoboken’s current general litigation counsel, the law firm of Weiner Lesniak. But Wiest said a Schenck attorney provided the specific background and knowledge he wanted for the construction-related claim. “I know what I’m looking for,” he said.
Given this level of exactitude, Councilman Ravi Bhalla said it was “very misleading” to describe the contract as pertaining to “general litigation.” He complained that the dispute that necessitated mediation hadn’t even been disclosed in private to the council.
“You’re just saying, ‘Write them a check for not to exceed $30,000’ and we’re supposed to rubber stamp that,’” said Bhalla. “That’s just not acceptable to me without more specificity.”
Bhalla also questioned whether the contract itself could represent a conflict of interest for the city since the law firm had previously served as Councilwoman Mason’s personal counsel in relation to City Council issues.
The council ultimately voted 7 to 1 to table the resolution until the Dec. 16 meeting so that more information could be furnished and the conflict of interest issue investigated fully. Council President Jennifer Giattino voted in opposition and Councilwoman Mason recused herself due to her previous dealings with Schenck Price.
This past Tuesday, the Council approved a revised version of the resolution that was capped at $10,000 and more fully specified the construction claims and why they necessitated mediation. Hoboken’s Corporation Counsel had also weighed in to make clear that voting on the contract was not a conflict of interest for the Council.
Carlo Davis may be reached at cdavis@hudsonreporter.com.