A Troubled History
DeKalb County agreed that to pay the lowest bidder, Desmear Systems of Tucker, $7.7 million, to blast and clear away granite at the site of an expansion of the Snapfinger wastewater treatment plant, in 2012. Work was to begin on July 30, 2012 and be completed in nine months. But the company has run into trouble almost from the start. Some key moments:
December 2012: DeKalb determines the construction bond on the project is fraudulent and orders work to stop at the site.
March: Work begins again, under a new bond. The county grants Desmear an extension because of the delay, for work to be completed by June 30. Desmear requests a second delay, through August 2013, citing rain and weather. DeKalb refuses. The county also notifies the company that it would enforce a penalty of $1,000 per day if the June 30 deadline is not met.
Aug. 26: A representative from Desmear notifies the county that the project would not be completed until February 2014.
Aug. 27: County officials meet with residents from neighborhoods surrounding the Snapfinger expansion, to address concerns about blasting noise.
Sept. 4: County inspectors visit the construction site and notice problems with the retaining wall being built. An internal review begins, to be done in conjunction with a review of all companies named in the special grand jury's report into allegations of corruption in DeKalb contracts.
Week of Sept. 16: The Atlanta Journal-Constitution begins asking about the awarding of the contract to Desmear, after revealing discrepancies in the company's financial information.
Sept. 19: In response to AJC questions, DeKalb County officials confirm several instances of poor work and lax oversight at the Desmear construction site and uncertainty about oversight on the project.
Sept. 20: DeKalb County orders all work to halt at the Desmear site, as an internal investigation continues.
About Desmear Systems, Inc.
Founded: 1986
President: Omatayo Idowu
Headquarters: Tucker
Services provided: Bills itself as a "full-service design and engineering firm with additional expertise in planning and program, construction and facility management."
Major projects: Construction manager on the Candler Road MARTA station; Resident engineer for $300 million Grady Hospital expansion; oversaw Perry Boulevard MARTA bus facility
How we got the story
The Atlanta Journal-Constitution is digging into how contracts are awarded in DeKalb County, especially its water and sewer department. A special-purpose grand jury last month released a report on its yearlong investigation that found evidence of widespread corruption in DeKalb contracting. Reporters April Hunt and Bill Torpy are among the AJC reporters reviewing DeKalb contracts to find out if they are awarded fairly and to find out if taxpayers are getting quality work for their money.
Citing shoddy work that may take months and more taxpayer dollars to fix, DeKalb County shut down work Friday on the first major project of its $1.35 billion water/sewer overhaul.
The Atlanta Journal-Constitution began asking questions about the $7.7 million excavating contract with Desmear Systems earlier this week, after learning the Tucker company had first struggled to secure a performance bond, then later provided a bond that turned out to be fraudulent. Lack of a bond would mean the county could have difficulty recovering any money it lost on the project.
Despite those problems, DeKalb gave Desmear the go-ahead in July 2012 to blast away granite and prepare land next to the Snapfinger wastewater treatment plant in south DeKalb for a $250 million expansion. The work is designed to help DeKalb plan for future growth and serve any home or business south of Decatur that flushes a toilet.
But problems ran far deeper than how the contract was awarded, according to county inspection records and meeting notes obtained exclusively by the AJC.
The county said it stopped the Snapfinger work because:
• A retaining wall is structurally unsound and far from complete. That retaining wall is meant to protect the plant expansion, the single largest investment in the $1.35 billion overhaul, and the nearby residential area.
• Water quality violations went unreported. Those problems alone could have pulled the plug on the job, which is part of $650 million of work being done alongside $700 million of federally mandated repairs that stem from DeKalb violating the federal Clean Water Act.
• Construction-related accidents had occurred, including one last week when a dump truck overturned. No one was hurt. Also last week, a subcontractor damaged an overhead electrical cable by not lowering a drill rig. Power was restored without any injuries.
A worker who answered the phone at Desmear’s office Friday afternoon said President Omotayo Idowu was out of town and unavailable for comment.
“These are issues that have festered, unwatched and unchecked, and we still don’t know who was accountable,” interim CEO Lee May said Friday. “I think this is just the beginning of some tough things being brought to the public, in how business was being done in DeKalb. It will not be pretty, but we have to put it in plain sight if we’re going to fix it.”
County officials are reviewing their options on the Snapfinger site. They could allow Desmear to return and make necessary fixes, move on to the next-lowest bidder or roll the remaining work into the next phase of the project.
Desmear was doing only site-preparation work. The construction of the plant expansion itself is not set to begin for several months, which will give the county time to determine what went wrong with Desmear.
Lack of oversight on county contracts was a major concern raised in a scathing special grand jury report last month, released after a year of looking into alleged corruption in DeKalb contracts.
DeKalb chief operating officer Zachary Williams; and Morris Williams, the commission’s chief of staff who is in his second week of also serving as the county’s public works boss, said they plan to meet with Idowu next week.
They are leading an internal investigation to determine who fell asleep at the switch, at every level. So far, they have concluded only that Desmear was selected as the lowest bidder who answered an invitation to bid. A “request for a bid,” a different way to attract vendors, would have required a ranking and review of bidders’ proposals, which did not happen for this job.
They also plan to hire an outside consultant to conduct a thorough review of the county’s purchasing policies and give May recommendations for changes.
That review could take months. In the meantime, the internal probe is designed to bring more immediate fixes, such as creating “quality assurance” operatives in every department, starting in the next week with Watershed.
Their job will be to review all department requests for bids and the resulting offers to specifically determine if vendors can deliver on their promises.
On the Desmear project, no one in the county questioned how Desmear would manage work that county engineers estimated would cost $12.5 million, for $4.8 million less.
Also being examined is why, once work began, DeKalb had no oversight on the quality of the blasting, digging and grading being done. Internal documents show Jacobs Engineering, which does on-call work for the county, was assigned as construction manager in January 2012.
How an engineering firm missed structural problems on a retaining wall, and who the point of contact in Watershed was for the oversight, is still unclear.
A spokeswoman for Jacobs said Friday that the company declined to comment on the situation.
“We are still investigating, but I can assure you there will be corrective action,” Morris Williams said. “We’re spending a lot of the public’s money, and if the public doesn’t have confidence, it’s not going to work.”
Albert Trujillo, the retired insurance executive who served as the special grand jury foreman, said the panel was especially concerned about confidence in contracting given the size and scope of the water/sewer system upgrade.
He welcomed the prospect of additional oversight but said that in stopping just one project the county had not gone far enough.
All of the work tied to the $1.35 billion overhaul should be put on hiatus, he said, even if the county must get federal approval to miss deadlines on some projects.
“It’s nice, but it’s not nearly enough,” Trujillo said. “Watershed is a cesspool and it won’t get straightened out until we put someone in there from outside DeKalb, outside Georgia really, who can clean this up.”
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