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By Kyle B. Hansen (contact) 
Thursday, July 16, 2009 | 1:34 p.m.
Sun coverage
A judge has denied a motion from an unsuccessful bidder for the Las Vegas Mob Museum that was seeking to have the Las Vegas City Council re-evaluate its bid for the project.
Flagship Construction Co. has claimed the city wrongly awarded an $11.5 million construction contract for the museum to a competitor.
Clark County District Court Judge Susan Johnson today denied Flagship’s motion for a preliminary injunction. She also removed a temporary restraining order against the city.
Flagship had sued the city of Las Vegas in Clark County District Court, saying it twice was the lowest responsible bidder for the job -- but that the work was eventually wrongly awarded to competitor APCO Construction for $11.5 million.
Las Vegas City Attorney Brad Jerbic said the city and APCO have a pre-construction conference scheduled for July 24 and that construction on the second phase of construction could start as soon as the next day.
Mark Ferrario, of the firm Greenberg Traurig, which represents Flagship, said he was unsure if the company would appeal the judge’s decision but that it would decide on its next move by early next week.
The Mob Museum, officially called the Las Vegas Museum of Organized Crime and Law Enforcement, is to be developed at the old U.S. Post Office and Courthouse Building on Stewart Avenue.
The first phase of construction, which was asbestos removal and other preparation work, is complete, Jerbic said. The second phase of construction includes historic renovation the building and other improvements, he said.
Sun Archives
- Friday hearing planned on Mob Museum contract (7-8-2009)
- Construction company sues city over Mob Museum bid (7-7-09)
- Tourism Commission backs bonds for downtown mob museum (6-16-2009)
- City sells $85 million in bonds to finance downtown projects (3-18-2009)
- Commission doesn’t like city’s special district plan (3-13-2009)
- Council OKs up to $100 million in redevelopment bonds (3-4-2009)
- Mob museum walks on public tightrope (2-3-09)
- Several cities seek stimulus money for museums (2-3-09)
- City sewer fund has $148 million — a good place to steal money for a mob museum (1-28-2009)
- $80 million bet on development is risky (1-28-2009)
It would be nice to know the legal theory the City was using to pick someone other than the lowest bidder.
In some states, cities can pick among the two or three lowest bidders.
If the decision by the City was not kosher, and Flagship pursues its appeal, I suppose Flagship will be able to prove how much "profit" they would have made on the construction contract, and they would get a money judgment against the City for that amount.
That's the problem when cities and counties issue construction contracts in a fast and dirty way. If their decision making is politically oriented, rather than legal, the taxpayers get stuck with the bill not the pols.
The only "remedy" taxpayers have against pols who make bad decisions which cost the taxpayers money is to "Vote 'em Out". But of course, that usually doesn't work when the pol who made the mistake has a huge campaign war chest.
Awarding contracts to the low bidder, based on lowest evaluated price alone, is a common practice that can produce false economies. Best Value Contracting is a system that allows owners to evaluate bids on price plus factors such as a contractor's history of performance on past jobs, the economic benefits for the community, the availability of a trained workforce and many other factors. Relying solely on the lowest price can lead to subsequent default, late deliveries, and numerous change orders or other unsatisfactory performance resulting in additional contractual or administrative cost.
Thanks for the comments.
To clarify, the city did award the contract to the lowest bidder after the second bid process. Flagship's main argument in court was that APCO was not a "responsible bidder" and the contract should have been awarded to Flagship as the second lowest bidder. Flagship's bid was about $1 million more than APCO's.