Disputed Contract Awarded Council Awards Water Main Job To Red Diamond By 4-3 Vote

Spokane’s affirmative action policies sharply divided the usually united City Council on Monday, prompting passionate debate from council members, city employees and the owner of a construction company.

In a rare 4-3 vote, the council awarded a $298,816 contract to Red Diamond Construction, Inc., to build a water main in the Latah Creek area.

Nekich Construction, the second-lowest bidder, challenged the contract because Red Diamond failed to meet the city’s goals for including minority- and women-owned businesses in its bid.

The city’s specifications for the project state that 5 percent of the project’s cost “shall” be done by minority- or women-owned businesses. Red Diamond fell short of the goal, coming in at 4.25 percent.

Mayor Jack Geraghty, council members Phyllis Holmes, Jeff Colliton and Orville Barnes voted in favor of giving the contract to Red Diamond.

Cherie Rodgers, Roberta Greene and Mike Brewer opposed the proposal, with Brewer moving to send the project out for new bids.

“I have a deep and abiding concern about the message this act is going to send,” Greene said. “It seems to me like the whole bid process has turned into a game in terms of what percentage is OK with the city.”

Barnes disagreed, saying, “I think the process has been properly followed.”

“This is a tough one,” said Geraghty.

Much of the debate centered on whether the affirmative action goals are just that - goals or requirements.

City Attorney Jim Sloane said the city once required a certain percentage of minority- and women-owned businesses be involved in every project. But a U.S. Supreme Court ruling about eight years ago struck down quota requirements in city-awarded contracts.

“Race-based requirements … cannot be requirements,” Sloane said.

The city’s bid specifications may say that companies “shall” meet the percentage, but, in fact, must only make a good faith effort, said Gita Hatcher, the city’s affirmative action specialist.

The city has rejected the lowest bidder on other projects for falling far below the goals or lying about the percentage, Hatcher said.

The owner of Nekich Construction said he’d hired more expensive companies from other cities to meet the goals in the past.

“I’ve had to go out of the way to Yakima to get minority contractors because they don’t have any in Spokane,” Frank Nekich said. “You’ve opened up a whole new can of worms because none of (the contractors) are going to feel like they have to meet this goal.”

Nekich also complained that Red Diamond’s original bid stated it would meet the 5 percent goal. Hatcher, who checks that part of the bid for accuracy, changed the number to reflect the true percentage, he said.

Hatcher said the company simply miscalculated. “We felt Red Diamond made good faith efforts to meet these goals,” she said.

Both companies are based in Spokane. No one from Red Diamond attended Monday’s meeting, city officials said.

Once the city accepts a contract, the company must abide by the percentage stated in the bid, Hatcher said.

Also Monday, the council:

Made a plea to the state Legislature to hike transportation taxes sufficiently to fix the city’s crumbling streets.

Appointed members of the city’s Citizens Review Committee, which will investigate complaints against the Police Department.

The members include: Rabbi Jacob Izakson, Rev. Lonnie Mitchell Sr., Atara Clark, Betsy Ressa, Micheal Holmes, Monte DeChenne, and retired judge Ben McInturff.

The committee has been dormant since being revamped two years ago. , DataTimes