TRC Speaks: Not Just a Knockdown

Contract fight over money and methods

TRC Speaks: Not Just a Knockdown
Courtesy of Austin Energy

The leading competitor for the Holly Street Power Plant demolition contract has broken its silence in the wake of City Council's decision last week to delay an approval vote to allow more time to study the differences in cost and qualifications between the top two firms vying for the project. Council is slated to take a fresh look at the matter on Jan. 27.

TRC Environmental Corp. is city staff's preferred candidate to disassemble the massive East Austin power plant. But the company's $24.9 million bid – the second-highest price among six submitted proposals – has provided sufficient ammo for two competitors to question the decision.

TRC project manager Mike Holder prefers to frame the question in reverse: "Why is our competition priced so low?" He says his company's bid price is more realistic because it will translate, in the long run, to fewer change orders – the requests that contractors must submit when they need additional funds to complete particular projects.

Nevertheless, charges of fiscal imprudence on contractual matters tend to make council members squirm, particularly in an election season with three incumbents up for re-election. Some insiders suggest that the Holly item was postponed at the eleventh hour, when the vote appeared to be leaning away from TRC and in favor of the staff's second-ranked firm, Dixie Demolition, whose bid is $6.1 million cheaper. That's when TRC decided to speak up.

While Dixie and TRC nearly tied in their overall scoring by city staff, TRC moved into the top spot because it out-ranked Dixie in most of the categories on the city's matrix system, including the number of local and minority- and women-owned contractors on the TRC team.

The bidding war turned particularly nasty in December, when another company – low bidder CST Environmental LP – raised a well-orchestrated public stink, first with a protest letter to the city, followed by a lawsuit (both dismissed). CST claimed it could do the job for $11 million cheaper than TRC. However, people knowledgeable of this type of work say there's no way CST could have dismantled Holly for its bid of $13.84 million, without adding millions in change orders on top.

Dixie, a scrappy Alabama company, also filed a protest letter with the city, and that, too, was rejected. In its complaint, Dixie went beyond the pricing issue and questioned the safety history of TRC and subcontractor LVI Services, in view of a pending lawsuit involving a worker fatality that occurred during the company's dismantling of a power plant in San Francisco.

Holder said the Occupational Safety and Health Administration "thoroughly investigated" the San Francisco fatality and determined that the incident was an unfortunate accident, not a result of unsafe conditions at the job site. He said the San Francisco project, and a similar power plant dismantling job in New York, were both located on waterfronts in low-income communities – not unlike the Holly Street Power Plant, situated on the north shore of Lady Bird Lake in a predominantly Hispanic, low-income neighborhood. "Projects like these are not just demo jobs," he added. "They are complex, environmentally sensitive projects with long-term socioeconomic impacts to the community."

Holder also noted that Dixie would perform about two-thirds of the job itself, while TRC would employ some 700 people in Austin. "This means that two-thirds of the money will be spent right here in Austin, with Austin-based and local neighborhood-based entities."

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