Pricey management contract under scrutiny

On Thursday night, Superintendent Sam Johnson and construction contractor Skanska USA will speak publicly for the first time about the progress that's been made on the San Mateo Union High School District's Measure M school renovation project.

Both will seek to resolve controversy that has erupted over construction management fees since voters approved the $298 million bond in November to complete the modernization of the district's seven campuses.

Skanska will try to reassure the district's board of trustees and taxpayers that it was justified in asking for $24 million to oversee the construction projects. The builder had originally estimated its management fees at about $11 million, and the new figure has drawn scrutiny from school board members and attorneys representing the district.

Johnson will likely be asked to explain why he recommended last month that the board approve the $24 million contract with Skanska. The school board balked when it realized that the contract had not been reviewed by the district's attorneys or its chief business officer.

The concern that has been voiced by trustees Peter Hanley and Linda Lees Dwyer is that Skanska could be grossly overcharging the district for its services. The district is already $74 million in debt because of cost overruns on its last major renovation effort, which was financed by the voter-approved Measure D in 2000.

The trustees are right to scrutinize construction costs, said Kathy Hicks, chief of program services for California's Office of Public School Construction. Hicks said she didn't know about Skanska specifically, but in general, it's "not uncommon" for construction firms to charge districts as much as they think they can get.

"I think on a regular basis they overcharge districts, and I'm frustrated with the districts because they allow it to happen," Hicks said.

Guidelines published by the Office of Public School Construction in 1994 suggest that construction management fees should be about 4 percent of the total cost of the project. Hicks said those figures are no longer in force, but that they should still be valid as a rule of thumb.

Skanska's figure is more than double that amount.

That discrepancy is part of what led Hanley earlier this month to call for a halt to the entire Measure M process while the district sorts out its oversight mechanisms.

Skanska's regional executive vice president, Rick Millitello, said he looks forward to addressing the concerns of Hanley and others at Thursday's meeting. "We're disappointed that Mr. Hanley has not taken the entire scope of services into account. This has been misrepresented by Mr. Hanley."

Johnson has warned that dropping Skanska and stopping the Measure M process at this point would undo months of progress and hard work by the district, Skanska and the architects who have already begun the project's design phase.

He took responsibility for a "miscommunication" that resulted in the contract being sent to the board without being reviewed by the district's attorneys. But he said the district needs to get to the negotiating table with Skanska and get moving to avoid costly project delays.

Dwyer, the trustee who intervened to stop the board from approving the contract when she learned the attorneys hadn't reviewed it, said she wants to understand better how the district chose Skanska.

One obvious connection is John Maloblocki, who would serve as Skanska's project executive for Measure M. Maloblocki previously managed the district's Measure D projects when he worked for rival builder Kitchell.

Dwyer acknowledged Maloblocki's experience with the district, but questioned whether that alone qualified Skanska for the job.

Maloblocki said Skanska, which has its international headquarters in Sweden and regional offices in Oakland, has worked on similar projects in the past and has "a lot to offer the district."