When Miami International Airport invited companies to bid on a construction contract, firms had to estimate costs for about 420 hours of work from safety coordinators. That was an error. MIA now says it needs about 17,000 hours.
“They were egregiously wrong,” MIA director Emilio Gonzalez said Thursday of the estimates attached to the proposed $6 million-a-year contract currently held by Munilla Construction Management. “We made a mistake.”
Airport officials did flag the stunningly wrong estimates — one of several — before awarding the contract. It asked the Miami-Dade County Commission for the chance to scrap the process and start again. But during a committee meeting, commissioners unloaded on the mistakes and questioned how one of the county’s largest departments could make such a glaring error.
This is totally ridiculous.
Commissioner Dennis Moss
“This is totally ridiculous,” Commissioner Dennis Moss said. Rebeca Sosa, chairwoman of the Economic Development and Tourism committee, also expressed amazement. “I have to tell you,” she said, “I’ve never felt so uncomfortable with a procurement item like I feel with this.”
The contract is relatively minor at MIA, to manage “miscellaneous” small construction jobs at the county-owned airport. The committee voted to extend Munilla’s contract by one year, at a maximum additional cost of $6 million, while MIA sorts out the next steps for the flawed bidding effort.
At the center of the contretemps is a form asking proposers to list the hourly rates they would charge for a string of job descriptions, from general manager to clerical. Each classification had “estimated hours” provided by MIA.
Proposers used the hours to calculate how much they would charge MIA based on the estimated hours. Another portion of the bid document required proposers to estimate more general costs.
It was as if we were going out to buy construction of a skyscraper, but we told people we were building a townhouse.
Miami-Dade assistant county attorney Oren Rosenthal
Munilla provided the lowest bid and won MIA’s nod to keep its contract. Bid documents show Munilla offered significantly higher hourly rates than those of the rival bidders ($300 for a general manager, compared to $74 from the second-place finisher), while keeping its general costs far lower.
That scenario favored Munilla once MIA realized its mistake. With the new hours, Munilla’s total cost would have soared from $2.7 million to $22 million, compared to $11 million for second-place finisher NV2A, according to an MIA summary prepared for the committee meeting.
The rival firms saw their estimated costs spike, too, with the bulked-up hours. But they noted Munilla would be in the best position to recognize the opportunity offered from the low-balled hours, since it holds the construction contract up for renewal.
Munilla argued the airport’s hour estimates were labeled as examples, and that all the firms could have used the same fee structure. It argued Miami-Dade should continue the process and negotiate a final contract with Munilla, a top contributor in county races.
“The bottom line is everybody had the same information,” Munilla lobbyist and lawyer Miguel de Grandy told commissioners, noting the other firms did not file formal challenges of the contracting process. “Nobody protested.”
Gonzalez did not offer an explanation for how the hours were so off, but said the division chief responsible is facing discipline. The errors outlined at the committee meeting showed exponential misses.
Reading from a document, Moss said that while the bid documents estimated 1,000 hours of work from a project manager, MIA now thinks the contract will require 33,000 hours. David Murray, an assistant county attorney, said that the 420 hours for a safety coordinator should have been estimated at 16,640 hours. And the 520 hours listed for the clerical slot are now estimated at 24,960 hours by airport staff.
Oren Rosenthal, another assistant county attorney, said that while some minor misses on the hour estimates could be forgiven, the gaps in the construction bid were so severe that it ruined the process.
“It was as if we were going out to buy construction of a skyscraper,” Rosenthal said, “but we told people we were building a townhouse.”