County’s Adelanto Detention Center Project Is $24 Million Over Budget

(June 28) In just two-and-a-half years, the construction contract on the Adelanto Detention Center Project has escalated more than $25 million.
Moreover, the total cost of the project, including engineering, architectural, licensing  and inspection costs, has now zoomed to $144 million, $24 million beyond the $120 million projected to be the project’s overall cost including a ten percent cost overrun contingency.
The construction bill on the project, originally slated at $90,951,937, has now reached $116,244,333. This week the county board of supervisors approved the seventh change order and its eighth and ninth contract amendments to the construction contract it has with Bellevue, Washington-based Lydig Construction, Inc.
There have been multiple overruns on the project, which the county’s architecture and engineering officials claim stem from what they say were unforeseen developments. Those changes, however, now exceed more than 20 percent of the original budget – well beyond the ten percent contingency initially allowed when the project was approved.
The project was born in controversy. The core of the facility in question was built as a 500-bed private prison in 1997 and 1998 by Terry Moreland. Construction cost on the project rose from an initially projected $11 million to $16 million and  Moreland became bogged down in disputes with construction workers, who sued, claiming underpayment and nonpayment. The facility opened and was run under the auspices of Moreland’s company, Maranatha Private Corrections, as part of the Moreland Family Trust, housing state inmates under contract with the state of California.
In July 2004, the state Department of Corrections announced it would not renew its contract with Maranatha and was to close the facility as of September 1, 2004. Moreland went to court against the state.
Moreland retained Platinum Advisors, a lobbying firm which employed former state assemblyman Bret Granlund. Platinum Advisors also worked as a lobbyist on behalf of the county of San Bernardino.  In a coordinated campaign that involved a request by then-sheriff Gary Penrod for more inmate-housing space and efforts by Platinum Advisors to  interest the county in absorbing  Maranatha Prison as a detention facility, Moreland was able to ingratiate himself with members of the board of supervisors.
While other options were considered by the county, including building a new large scale jail from scratch or adapting and expanding the city jail in Adelanto, Moreland through legal and political efforts was maintaining his contract with the state on a month-to-month basis. Platinum Advisors and Granlund intensified their efforts on behalf of Moreland to interest the county in the Maranatha Prison, including the provision of gifts to then-chairman of the board of supervisors Bill Postmus. At Postmus’ behest, the county agreed to consider an appraisal of the facility for the purpose of considering a potential purchase.
The appraisal, completed in February 2005, pegged the facility’s value at $28 million.Granlund formulated an option to buy and purchase agreement for the facility, located on 9438 Commerce Way in Adelanto, and offered it to the county.
In April 2005, the county exercised that option to purchase the prison for $31.2 million, which included $3.2 million in improvements. Controversy would later ensue when members of the board of supervisors claimed they were not aware that Granlund and Platinum were working for Moreland.
Moreland’s contract with the state was terminated after the county purchased the prison. It lay fallow for more than two years. In March 2008, the board of supervisors approved thesubmittal of a proposal to the State Correction Standards Authority requesting available funding of up to $100,000,000 to cover 75 percent of the cost to construct 1,368 additional jail beds at what was dubbed the Adelanto Detention Center. In May 2008, the county was conditionally awarded the requested $100 million for the expansion, and was ranked first on the list of public entities to be conditionally awarded funds  available under a state detention facility financing law, AB900. In July 2010, the board gave conceptual approval to the project and established the various obligations of the county, California Public Works Board, California Department of Corrections and Rehabilitation as to the project’s general terms and termination, cost, cost sharing, scope, schedule, bidding and construction, post project completion and records retention for the project.
The county held a bidding competition that fall and in December 2010 awarded a $90,951,937 contract to Lydig as the low bidder. The overall project cost at that time was put at $120 million, which included a ten percent contingency.
Since that time, the cost of the project, which is to consist of three four-story housing buildings plus a support building that includes booking and holding cells and a medical clinic, has consumed the state money and eaten up the ten percent contingency as well and risen significantly beyond that, led by contract increases with Lydig.
This week the board of supervisors approved a $10 million increase in the project cost for the jail expansion. In May, the board approved an $8 million increase to the jail project budget. Three months before that, in February, the board agreed to a $6 million increase.
Recurrent issues in the construction cost increases have been functionality problems and design changes with the smoke control and fire sprinkler systems and change orders and contract amendments pertaining to a water well on the site which was intended to provide water to the facility that turned out to be contaminated with a high level of fluoride.
A review of the change orders and amendments on the project and their expense and extent illustrates the degree to which the project was not fully examined or projected prior to commencement.
Eight months after Lydig was granted the original $90,951,937 contract, the county amended the contract to pay Lydig another $448,516 to install approximately 3,000 linear feet of 5” conduit, pull boxes and electrical vaults as required by Southern California Edison.
On December 13, 2011, a second amendment to the contract was made for demolition and installation of concrete and asphalt associated with the rerouting of utilities and electrical duct banks as well as the modification to 124 handicap combo units at a cost of $303,773.
On April 24, 2012, a third amendment to the contract relating to modifications to lengthen holding cell benches and state fire marshal-mandated design modifications to the construction elevated the contract by $834,076. On September 11, 2012 a fourth amendment calling for the addition of handicap desks to the jails dayrooms, stainless steel well casing for the well and state fire marshal-mandated seismic upgrades to thefire protection lines set taxpayers back another $557,668. On February 23 of this year, the county amended the contract  to provide state fire marshal-mandated changes to the smoke control evacuation and automatic fire sprinkler systems, increase in number and size the heating ventilation and air conditioning structural roof supports as well as make further modifications mandated by the state fire marshal and various other agencies, providing Lydig with another $2,472,388 enhancement to the contract. On May 21, the county amended Lydig’s contract relating to labor and materials related to the revision of the smoke control systems and fire protection systems, to, in the words of county director of architecture and engineering Carl Alban, “convert the specified fire smoke dampers to smoke dampers as part of the revisions to the smoke control system” in the amount of $5,063,392.
Also on May 21, the county approved amendment No. 7 to the contract to cover labor and materials for the added treatment systems associated with the water well, not including the potential costs of schedule impacts along with labor and materials for the purchase of the switch gear and installation of conduit from the service yard to the existing pull boxes, as required for the installation of a third electrical service at an added cost of $1,818,807.
In addition to those previous contract amendments, the county also made several expensive change orders, including one for $2,101,536 on  August 23, 2011 that called for upgrading the security electronics in the existing facility and to provide touch screens, digital intercoms, a camera system and increased video storage capabilities, install frosted security glazing in lieu of the standard clear glazing specified in the sleeping rooms and install an anti-MRSA and prime coat finish on the floors and walls at the support building. It then made a second change order on December 13, 2011 involving an added cost of $2,392,443 to install a card reader system in the housing units to be utilized by sheriff personnel, purchase scheduling licenses for video visitation kiosks; and upgrade the roofing system to a single ply system.
On April 24, 2012 the architecture and engineering division sought from the board of supervisors approval for a third change order that called for installing an anti-MRSA coating to interior handrails in the dayrooms of the housing units and the installation of various security electronics, electrical and plumbing modifications and enhancements at a cost of $824,237.
On September 11, 2012, the board acceded to a fourth change order, at a cost of $902,801, for the addition of detention ceilings at the 32-bed dorms; modifications to center core casework, guardrails and exhaust systems, modification of the roof system and various utility modifications and enhancements.
On February 26, the fifth change order, one for $367,734, provided electrical power and venting for dryers and various structural, utility and mechanical modifications to the new expansion and existing facility.
On May 21, the sixth change order, at a cost of $47,651, called for the planting of Yucca Rostrata Trees in lieu of the specified owner-furnished Yucca Trees which are no longer available; modifications to the seismic joints between the housing units; providing a remote maintenance bypass switch for the security electronics system; deleting the painting of the interior of the mezzanine level mechanical chases; and providing security metal panels to conceal electrical conduits in two of the buildings.
This week the board approved an eighth amendment to the contract at a cost of $6,068,128 to cover labor, materials, labor impacts and acceleration costs related to the revision of the smoke control systems and fire protection systems. This brought the total cost of repairing the smoke control systems to $11,068,128, which includes the $5,000,000 allowance approved as part of the sixth amendment to the contract.
This week the board also signed off on a ninth contract amendment, one for $537,336, to cover labor and materials for the added treatment systems associated with the water well, not including the potential costs of schedule impacts. The total cost of the treatment systems is $2,037,336, which includes the $1.5 million allowance approved as part of the seventh amendment to the contract.
The board on Tuesday also approved a change order, entailing an added cost of $551,910, to make security improvements requested by the sheriff’s department; modifications to the phone and data cabling requested by the county’s information services department to improve facility communication systems; and miscellaneous revisions related to construction..
To date, the construction contract amendments and change orders total $25,292,396, pushing the total amount of the revised contract to $116,244,333.
In addition to the amendments to and change orders made on the construction contract, there have been amendments and change orders to other service providers on the project.
The firm of  Hellmuth, Obata & Kassabaum, Incorporated, based in Culver City, was originally given a $4,466,000 contract to provide architectural service on the project. Nine amendments later, Hellmuth, Obata & Kassabaum’s contract has reached $10,438,396, an increase of $5,972,396.
C.H.J. Incorporated of Colton was hired under a $413,857 contract to perform testing and inspection. After fivecontract amendments, C.H.J. has taken on another $1,920,546 of work so that the total amount that company has received under the revised contract is $2,334,403.
At this point, the $100 million provided by the state of California for the project has been expended  and the county’s costs have reached $44 million. Alban was not able to offer a guarantee that there will be no further increases in the project, which is supposed to be completed by January.

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