POINT COMFORT – Newer Calhoun Port Authority board members admonished its staff after they had to change the scope of a contract not once, but twice.
The change amounted to a 36% increase in the contract price.
“When we’re doing over 30% change orders, we need to go back and look at: Are we doing enough pre-work to determine our contracts? A 30% change order is ridiculous,” said Jasper “Jay” Cuellar.
“36%,” Luis De La Garza said, correcting him.
This is Cuellar and De La Garza’s third meeting as board members after they beat longtime incumbents by large margins last month.
The incumbents endured about a year of public scrutiny after the port hired former Congressman Blake Farenthold as the port’s first, full-time lobbyist.
Farenthold resigned in January.
The contract discussed Wednesday involves piling maintenance.
It was first changed last month after a 4-to-1 vote, so that maintenance could be performed on an additional 19 pilings that Port Engineer David Knuckey said he had inadvertently left off the bid documents. That initial change amounted to an estimated $102,000 increase in the contract price. De La Garza voted against the change.
Wednesday, port staff recommended the contract be changed again to repair pilings that had rusted so much their structural integrity could be compromised. They said the contract change was also necessary to replace 19, 8-inch braces for the pilings that had rusted through, too.
Knuckey said he and staff visually inspected the pilings for about two hours before going out for bids, but they weren’t able to see the damage to them because marine growth covered it.
“My recommendation would be to go ahead and modify this contract; otherwise, we’re probably going to end up spending $100,000 more to mobilize and demobilize the equipment if we go back out for bids again,” Knuckey said.
Wednesday’s change amounted to another $107,765 and was approved unanimously despite the admonishment. De La Garza said he voted in favor of the change Wednesday because Knuckey assured him it was the last of the piling maintenance the port would have to perform for a while.
Cuellar and Johnny Perez, who was appointed to the board in September 2018, suggested ways to avoid change orders on contracts in the future.
“I want to know if we consider doing more frequent inspections? Do we need to do something that would better determine the job scope?” Cuellar asked.
“I don’t know about inspecting, but blasting and re-coating, that may have to be done more often than it actually is,” Perez said. “Because it was inspected and they didn’t see it.”
J.C. Melcher Jr., who nows serves as the board chairman, said this is the reality of maintaining a port now in its 30s.
Next week, Port Director Charles Hausmann and all but one of the board members will travel to San Francisco to attend the American Association of Port Authorities conference. Board member H.C. “Tony” Wehmeyer Jr. has chosen not to attend.
Although the board has traditionally disclosed very little publicly about this annual conference, De La Garza made a point of doing so Wednesday.
He said the conference consists of two days of presentations and a third day spent touring the port in that city.
“Some of the topics we’ll talk about that I’m looking forward to hearing is discussions on global marketing for the port, security for the port and infrastructure super projects. There’s a lot of lessons learned out there from other ports that hopefully we’ll be able to look at for our own port,” he said.
Last year, the port spent about $19,000 to send board members to the conference. Then, the conference was in Chile, and the port also paid for the board members’ wives to attend.
Some people were critical of that as well as the board’s benefits. The port still pays board members $400 for attending a meeting and $125 for their retirement each month, but De La Garza said Wednesday that he plans to present to the board bylaws next month that could change some of that.
The port does not currently have bylaws.
It was created by the Legislature in 1953 and is governed by the special district local laws code, although the board has passed resolutions over the years regarding how long the chairman serves, how much the board gets paid and under what circumstances the public can address it.
After the meeting, De La Garza said the other board members are looking at how they can apply bylaws used by other Texas ports to meet the Calhoun Port Authority’s goals. They are also asking staff to compile the resolutions that the board has passed.
“What bylaws do for us is they remove emotions,” he said. “In the past, you never really knew how a decision was going to be made, how an agenda was going to be drawn up.”
Cuellar, who is the human resources manager for Seadrift Coke, which uses the port, said in an interview with the Advocate after the meeting that he thinks the bylaws should lay out a defined procedure for any kind of conflict of interest. He posed a hypothetical situation in which this procedure would be helpful.
“If the plant (Seadrift Coke) ends up with an agreement to send 20 ships a month to the port, and it gets it for half the price as Formosa, that’s going to look pretty sad with me being on the board,” Cuellar said. “I want to make sure there’s a process that shows that I’m not included in the decision-making, and I’m not unduly influencing the board.”
Although they are being paid for attending meetings, both De La Garza and Cuellar chose not to accept the port’s $125 payment toward their retirement each month.
The port is also not paying for their wives to attend the conference in San Francisco.
The Advocate reached out to all board members to ask them their thoughts about bylaws, benefits and the conference, but did not hear back from all by deadline.
Deputy Port Director Forrest Hawes said the port currently has about $29 million in the bank while Hausmann said about 4.6 million tons of product have come through the port during the past 11 months. The port’s fiscal year ends June 30.
“4.9 to 5 million (tons) is where we’re hoping to end up,” Hausmann said.
This is about the same amount as last fiscal year.