With the multi-million dollar airport road project contract terminated with Whitehorn Construction, the government is now waiting for federal approval on two options they may take in order for the construction to move forward, said ASG witnesses at yesterday's Senate Public Works Committee hearing.

Termination of the contract centers around the problem with Whitehorn’s performance and materials bond, which was later found to be invalid. The government had then given the company 46 business days to come up with a new bond but the timeline expired at the close of business last Friday without a new one in place, resulting in ASG moving to terminate the contract.

Since the Fono re-convened on July 8, several senators wanted an update on the $7.99 million contract for the airport road project, and Committee chairman Sen. Alo Fa’auuga called the hearing to address problems associated with the airport road project.

Witnesses who attended the one-hour hearing were the Governor’s Legal Counsel Steve Watson, Chief Procurement Officer Tiaotalaga John Kruse, Samoan Affairs official Tumua Mulitauaopele, Public Works director Faleosina Voight and Public Works official Reuben Siatu’u.

Tiaotalaga told senators that the Whitehorn contract is now terminated and the termination notice has been sent to the contractor. He said there has been discussions with the Federal Highway Administration, the funding agency, regarding options which can be taken in order to move the project forward.

The two options mentioned during the hearing are to re-bid the project or to sole source it — negotiating with McConnell Dowell as the new contractor, as they are the only one currently on island with all the necessary equipment for such a project.

For the sole source option, negotiations would also include any recommendations from McConnell Dowell, as well as discussions of total unused project funds, the CPO said, adding there is an ongoing review of records to see if there were any monies paid to Whitehorn that should be recovered.

As reported by Samoa news last year, Whitehorn’s bid for the project was $7.99 million and the only other bid came from McConnell Dowell for $11.03 million. Government engineers estimated the cost of the project at $11.84 million. 

These bids and engineers’ estimate numbers came up at yesterday’s hearing as some senators wanted to know the estimated cost of a new contract, if the project ends up being given to McConnell Dowell.

Voight said there are still unused funds from the $7.99 million contract and ASG is now waiting for approval from Federal Highways on options that were recommended for getting the project finished.

Sen. Laolagi F.S. Vaeao said Whitehorn’s bid was very low compared to McConnell Dowell’s bid and he is a bit concerned as to how things will work out with the money issue if McConnell Dowell does end up taking over as the new contractor, and wants more money based on its original bid offer.

He noted the engineers’ estimates were also higher than Whitehorn’s, adding that he is hoping for a good outcome of this project, as more and more residents complain about the conditions of the airport road.

Senate President ProTemp Nua Saoluaga asked how much ASG has paid to Whitehorn based on the work it has already carried out, to which Voight answered, it’s “a little bit over $1 million” and this includes reimbursement of about $399,000 in the bond premium, while the rest is for other expenses such as material/ supply purchases.

Nua wanted to know if Federal Highway administration will provide any more funds for this project if McConnell Dowell asks for more money — and if there have been any discussions with the federal grantor about getting more money for this project.

Voight responded that these are all of the issues included in discussions with Federal Highways: the unused money from the original contact as well as any other additional funds, which might be needed from the federal agency in the event a negotiation with McConnell Dowell ends up higher than what is left in the initial contract.

The DPW director pointed out that there have been cases in the past where contracts were terminated and new contracts negotiated, resulting in a higher amount than what was left in the original amount. And in these cases, she says, there was additional financial support from Federal Highways.

Based on previous cases, Voight said she believes the Federal Highway Administration will support additional funds to complete the project. She said “it’s either — renegotiate based on the money available, reducing the scope of work in accordance with the money left; or re-negotiate based on the original scope of work and request additional funds to complete the project.

Voight says it’s the government's goal to complete the project based on the original scope of work, which includes three more roundabouts (located at the corner of the road to Fagaima, the turn into the American Samoa Power Authority and the three corners in front of the PX), improved sidewalks and putting a medium between the two lanes between the turn in road to Fagaima and the three corners of the PX.

Sen. Magalei Logovi’i asked, if McConnell Dowell was awarded the contract, with its bid of $11.03 million, would Federal Highway Administration make available this entire amount of $11.03 million?

“Yes”, was Voight’s reply, adding that whatever the winning amount of the contract, the Federal Highway grantor will provide the funds.

Magalei noted that a re-bid of the project means the public will again have to wait for some time because of the procurement process involved. Voight agreed, saying that this would be the argument if the feds want to rebid the project — the long wait while the project goes out for rebid.

However, Voight stressed that ASG is currently waiting for federal approval of the options, which can be taken.

Responding to Magalei’s question, if ASG had advanced any money to the contractor— Tiaotalaga said “no” ,adding that the only money paid out was based on payment requests.

In tomorrow's edition, Magalei’s verbal exchange with Watson over the bond issue.

SIDEBAR

Samoa News reminds readers that the contract for the project was awarded last year, prior to the current administration taking office in January this year.

Also, during yesterday’s hearing at no time was Paramount Builders mentioned, who was the major local subcontractor for the Whitehorn airport road contract, nor was the amount of local people who lost their jobs lost due to the Whitehorn contract being terminated discussed.

There is also the issue of the land use permit application by Paramount Builders, and its owner Papali’i Lauli’i Alofa, to build and operate an asphalt plant for the airport road project. While Samoa News was recently told the Project Notification and Review System (PNRS) Board that held a hearing last week Friday on the application, has put the permit on hold until certain issues are resolved, Samoa News was also told earlier that the permit had already been signed off by the governor’s office.

PNRS board meetings review land use permits for mainly environmental concerns, and last week’s hearing brought to the table vocal opposition from many Tualauta residents over the proposed location of the plant. A petition was also presented during the hearing, which was circulated for two days and garnered 221 signatures from Tualauta residents objecting to the proposed asphalt plant. Objections centered on health hazards due to the proposed plant’s location, which they said was too near schools, a sports stadium and residential houses.