Facts – Schematic Design

SCHEMATIC DESIGN

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The Studio’s work continued under the various levels of oversight designed by the City.

The City of Irvine, Great Park Corporation and the Program Manager, Bovis Lend Lease continued to provide oversight to the Design Studio. The Program Manager Bovis Lend Lease reviewed and approved all of the Design Studio’s work and invoices.

HSNO alleges that the City violated its own policy by failing to get competitive bids for the Schematic Design contract.

The City Council had made the decision to undertake an international design competition with two separate juries of experts to select a master designer of the Great Park. Watch the Schematic Design video to see Board Member Christina Shea and Interim CEO Sharon Landers explain why the City should not have started the selection process all over again for the Schematic Design.

HSNO implies that the Design Studio’s fees were too high for the Schematic Design.

This is completely false. The City engaged two highly respected industry experts to provide independent opinions and validate the Design Studio contract fees. The first expert was the program manager, Bovis Lend Lease. Bovis informed the Great Park Corporation Board that based on industry standards that the cost of design should be 8-12 percent of the project’s total cost. Using Bovis’ industry standard analysis, the range of fees for the Master Plan and Schematic Design for the Great Park would have been somewhere in between approximately $26 million and $39 million. The other expert hired by the City, Dockside Consultants, informed the Great Park Corporation Board and City Council that the Schematic Design contract fees were “favorable” to the City. After HSNO’s allegations were publicized in January 2014, Gafcon asked an internationally known project management and cost management firm, Faithful and Gould, to triple check the reasonableness of the Design Studio’s fees for the Master Plan and Schematic Design. Faithful and Gould provided an analysis that demonstrate the range of fees for Design Studio’s total scope of work should have been between $37 million and $53 million, meaning that the City received an extremely favorable contractor fees for the Design Studio’s work.Schematic-Design_charts-update

The City and Great Park Corporation Board voted to add additional elements to the Schematic Design Contract.

These additions included strategy and communications, final mass grading design, additional costs for reimbursable expenses and other consultants.

HSNO alleges that fixed fee nature of the contract was inappropriate or the City should have never approved any change orders.

Watch the Schematic Design video to see City’s expert consultant, Craig Smith of Dockside Consulting explain how he and the other members of the contract negotiations team carefully negotiated the scope of the fixed fee agreement. The Fixed fee nature of contract was also supported by Christina Shea, City Council Member.

HSNO alleges that the Design Studio requested numerous change orders to the Schematic Design Contract. This is false. The City and Corporation requested the change orders.

Watch the Schematic Design video to see the Corporation’s Director of Planning Glenn Worthington’s presentation on how change orders were approved at an August 7, 2008 Board meeting and Corporation Senior Management Analyst Debbie Gunderson gave another explanation at the conclusion of the Schematic Design agreement.

HSNO alleges that the Design Studio performed work on change orders in advance of receiving the signed change order.

HSNO does not mention in their report that the Corporation instructed the Design Studio to start work on new projects without a signed change order, nor do they mention that this issue has been reviewed and addressed by two prior independent contract compliance audits. After being instructed to performed work without signed Change Order, the Design Studio performed work “at risk” which means that the City was not required to pay the Design Studio if it was unhappy with the work. Watch the Schematic Design video to see Great Park Corporation Director Pinto, auditor Kim Onisko and Great Park CEO all discuss this issue.

HSNO alleges that Forde & Mollrich was a key member of the Design Studio.

HSNO alleges that Forde & Mollrich was a key member of the Design Studio. HSNO fails to mention that Forde & Mollrich had been working for the City since 1999, which was nearly 7 years before the Design Studio was selected as the Master Designer in 2006. HSNO also fails to mention that Forde & Mollrich was not part of the Design Studio team that won the international design competition. Lastly, HSNO also fails to say that it was the City of Irvine who instructed the Design Studio to retain Forde & Mollrich as a subcontractor. As shown in this OC Register article in 2007, the City decided to manage Forde & Mollrich directly. The City not only supervised Forde & Mollrich, but was also responsible for reviewing its invoices, bypassing the program manager, Bovis. Lastly, after the Design Studio completed its work in 2009, Forde & Mollrich remained as a consultant to the City until 2012. Contrary to HSNO’s allegation, Forde & Mollrich was a long-term key member of the City’s team, rather than the Design Studio.

HSNO alleges Feasibility Studies were inadequate and the City Staff were unable to submit the studies to the City Council. This is false.

Watch the Schematic Design video to see Board meeting where the Design Studio presented the Feasibility Studies which demonstrates that Corporation staff were able to submit the studies. The studies were praised by various members of the Board.

When the Schematic Design contract was closed, the Corporation announced they saved at least $5.4M, representing more than 12% of the total Schematic Design contract.