Pennsylvania's construction dysfunction
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Pennsylvania Auditor General Jack Wagner recently released a special report on the construction of the Petersen Events Center at the University of Pittsburgh. This report was needed to understand the delays and cost overruns and to assure taxpayers that they will be addressed, or avoided, in future projects.
James P. Creedon is secretary of Pennsylvania's Department of General Services (www.dgs.state.pa.us).
We appreciate the auditor general's work and the Post-Gazette's efforts to raise public awareness of the difficulties in completing this challenging project. We want to assure you that the Department of General Services, under the direction of Gov. Edward G. Rendell, has been making dramatic improvements in the way these massive construction projects are managed for the past four years.
Bottom line: The commonwealth now constructs buildings and manages the cost of the multi-million-dollar projects in its $1.2 billion portfolio much more effectively than when the Petersen Events Center began to rise. It is also important to note that this project was built during the previous administration.
As the auditor general said, one of the biggest challenges of the Petersen project was the use of a multitude of prime contracts. This was the way the past administration undertook public works projects and that practice left a legacy of problems that we have been forced to clean up since 2003.
Since Gov. Rendell took office, the commonwealth has not constructed a project with more than six contractors. In fact, the overwhelming majority of our projects are now limited to four contracts and this change is working.
According to the governor's annual budget to the Legislature:
Since 2003, the change order rate on general-services projects, which measures our ability to control costs and contractor performance, has dropped from 20 percent to less than 6 percent. This is a huge accomplishment.
Construction claims, or money needed for additional work to complete a project, have dropped by more than 98 percent, from $19.7 million on Jan. 1, 2003, to $284,567 as of Jan.1, 2007.
This year, 97 percent of our projects will be completed as budgeted.
Ninety-five percent of projects managed by general services are now completed on, or ahead of, schedule.
The Department of General Services continues to pursue new reforms, such as requiring evaluation of a contractor's past performance, reviewing client references and analyzing proposed management teams, along with competitive pricing. In addition, we are starting a pre-qualification process to ensure that contractors who compete are qualified to manage the scope of proposed projects.
We also are being more aggressive in our debarment process to be sure that poorly performing contractors can no longer work with our department. We do not reward bad performance with more work.
In conclusion, Department of General Services construction practices have changed dramatically under Gov. Rendell. We monitor our activities carefully and constantly pursue new ideas and approaches to improve our performance. We quickly recognized the problem in the construction of the Petersen Events Center when we came into office in 2003 and made significant reforms to ensure the problems would not be repeated.
The people of Pittsburgh and of Pennsylvania need to know that we are committed to not repeating the mistakes of the past.
First Published May 15, 2007 5:39 pm
