Build Operate Transfer (or: How I Learned To Stop Hiding And Love Transparency)
It’s possible you missed the controversy last week about why West Lafayette leaders didn’t know more about the bid they were about to approve in the biggest project the city has ever undertaken. It’s also possible the answer to their question (“Why wasn’t this more transparent?”) is this old chestnut: “Because that’s the way we’ve always done it.”
Everyone hopes that, about three years from now, State Street will look something like this:
But first, the city and Purdue University have to fork over about $120 million to Rieth-Riley construction company and its Plenary Roads State Street group of subcontractors.
City officials last week said Rieth-Riley beat out Walsh Group (the same folks responsible for this summer’s I-65 bridge sinking in Tippecanoe County) and Macquarie Group (the same folks who were part of a consortium responsible for leasing the Indiana Toll Road for nearly $4 billion that then had to give it back a few years later when they realized they couldn’t manage the project anymore) because Rieth-Riley proposed doing the most for the $120 million they were about to be handed.
The contents of Rieth-Riley’s and Walsh’s bids were known only to the State Street Joint Board, made up of reps from West Lafayette and Purdue who’d signed confidentiality agreements stating they couldn’t talk about the contents of those bids until a public hearing announcing the winner. Here’s the relevant piece of Indiana Code:
Disclosure of contents of proposals
Sec. 6. The governmental body may refuse to disclose the contents of proposals during discussions with eligible offerors.
Note the word “may” in the above paragraph. That’s a word that, in legal lingo, gives WIDE leeway. It’s not “shall” or “must.” Instead, it’s kin to “can” and “could”. And, much like “flammable” and “inflammable” mean the same thing, “may” also means “may not.”
That said, herewith a modest proposal about how the process can be done better the next time someone in Indiana decides to do it: pit the offerors against one another publicly.
Think about it: Everyone agrees the State Street project will not cost more than $120 million, so this is different than a standard sealed bid process, where companies are competing to do the same project for the least cash. Instead, they’re trying to do the MOST project for a DEFINED amount of money (or less).
So it’s a public-private partnership game of chicken that should be conducted in the most public way possible — heck, you could hold it in a town square and sell popcorn if you did it the right way — it would be FUN to watch. Use these simple instructions:
- Tell Rieth-Riley and Walsh to send their best negotiators and prepare presentations of what they can offer.
- Reserve space in a large park and publicly advertise the meeting.
- Make popcorn.
- Put Rieth-Riley’s and Walsh’s people on a stage and let the city’s mayor act as auctioneer.
- Flip a coin and decide who bids first.
- Each side gets as many opportunities as it wants to better the other side’s proposal, with Walsh and Rieth-Riley making alternating bids. Each side can either bid down the cost of the project or bid up the number of items included.
You could even let the people vote, right then and there, whether they like what they’re about to get. It’s the kind of public input and decision-making that just DOES NOT OCCUR now. You want people to feel connected to this project and proud of their government for getting it done? This is a better way.
And it’s both perfectly transparent and completely legal. Everything is done out in the open, within the confines of the law and in a way that unquestionably seeks public input and approval for the final design.
Please note also that the city is not obligated in any way to sign off on the “winning” bid if it doesn’t like it. If neither is impressive enough, ask for more proposals. This ensures the project isn’t just slapped together and rushed through; that only quality is accepted.
Since this was the first BOT project in Indiana involving a University, there were bound to be hiccups and stumbling blocks. And Indiana’s business-friendly legislature tends to write laws which err on the side of the 800-pound gorilla (in this case, Purdue). So it’s incumbent on those businesses to act as openly as possible.
Did Purdue, as University counsel Steve Schultz said multiple times at a meeting last Thursday, “follow the letter of the law” with the State Street bids? No question about it.
But could Purdue have been more open? Certainly.
There’s still every reason to believe the project will be good and that West Lafayette will be changed for the better. But there’s no reason for Purdue officials to say they’re “puzzled” when the West Lafayette Redevelopment Commission asks for more transparency.
The law is written in such a way that if you’re not hiding anything, it’s easy to make a public show of that. To do otherwise only invites questions.
But there are other ways to use this broadly-written law so that the next time this is done, the prevailing question is: want butter with that popcorn?