Unified Government Mayor Joe Reardon has sounded the warning: He’s ready to fight long and hard over the GSA’s plan to pull the EPA regional headquarters out of downtown KCK and relocate it in Lenexa.
But look out for the GSA: It’s shoring up its defenses.
Oh, the government won’t engage in verbal battle with Reardon, but it’s getting ready.
Listen to what the two sides are saying:
In an interview on Wednesday, Reardon said that:
– He would take his case directly to the White House.
– He might appeal the decision to the GSA inspector general, a referee of sorts.
– He expected the owner of the EPA building on Minnesota Avenue to file a formal protest (which would be filed with the U.S. Government Accountability Office) over the GSA’s decision.
– The GSA should explain in more detail and more clearly why it had accepted the offer to house the EPA headquarters in a Lenexa building that opened in 2008 and was used for a while as Applebee’s headquarters.
“We need transparency,” Reardon said. “To me, it (the decision) defies common sense and good public policy. We couldn’t figure it out.”
For its part, the GSA is playing it cautiously, as you would expect, but is preparing to make a formal presentation “in the near future” regarding the selection process and its decision. GSA spokesman Charlie Cook did not indicate when that presentation might take place.
“We are preparing a broader outreach,” Cook said. “We want to get out in public and explain (the selection process) to the extent we can.”
So, the stage is set: The adept, rising politician (some are touting Reardon, a Democrat, as a possible candidate for U.S. representative next year) versus the faceless, entrenched bureaucracy of the GSA.
It will be interesting to see how this unfolds, but this is going to be quite a challenge for Reardon and Wyandotte County’s Unified Government.
GSA officials wouldn’t have made the decision they did without mounting a stout defense along the way.
The GSA will stand, primarily, on formal and strict “federal acquisition regulations,” and it probably will contend that the owners of the Minnesota Avenue building were “not responsive” to the government’s formal, 73-page solicitation of proposals that went out last fall.
While officials with UrbanAmerica Advisors, New York, which owns the Minnesota Avenue building, contend their proposal was superior, they have so far refused to release it. And the government is prohibited by regulation from releasing any of the losing proposals.
It’s not our information to share,” Cook said, citing federal regulations.
As a result, the only information about UrbanAmerica’s proposal that has come forward has been provided by Urban America, and the facts that it has chosen to release could well be self-serving.
Earlier, Urban America officials said they proposed a 20-year lease at an average of $25 per square foot. That would put their proposal at about $5 million a year, or $100 million over 20 years, for the 200,000-square-foot building on Minnesota. (The Applebee’s building has 187,000 square feet.)
In a brief telephone interview on Thursday, however, Scott Hall, an UrbanAmerica senior vice president, declined to answer questions about his firm’s proposal or about the possibility of a formal protest. The deadline for filing such a protest apparently is late next week.
His reticence could be due, simply, to the delicacy of the situation. Or, it could be that UrbanAmerica’s formal proposal would be exposed as problematic.
For example, if Urban America submitted an offer for a flat 20 years, the GSA would have considered it “not responsive.” In its solicitation, the GSA specified that it wanted proposals for “10 years firm,” with options to renew for up to 10 more years.
It is undisputed that Lexington LAC Lenexa LP, owner of the Applebee’s building at 112th and Renner Road, complied with the request for “10 years firm.” According to numbers that Cook released, GSA would pay about $52 million for a 10-year lease of the Lenexa building and about $120 million over 20 years.
Further clouding the Urban America bid, the $25-per-square-foot figure might not include everything. Cook, of the GSA, drew a distinction between a square-foot proposal that was “fully serviced” and one that was only “partially serviced.” In other words, the rate could be higher than $25 a foot if it did not include costs such as utilities and building maintenance.
Just as it is unclear if the length of UrbanAmerican’s proposed contract complied with the solicitation terms, it is equally unclear if Urban America’s self-proclaimed bid of $25 a square foot was fully or partially serviced. If it was only partially serviced, the additional expenses could have pushed the lease rates above that of Lexington LAC.
And Cook is very firm about the bottom line: The Lexington LAC proposal, he said, “was the highest technically rated and the lowest-priced offer we received.”
– The solicitation specified that the GSA wanted a building that met the Silver, Gold or Platinum LEED (Leadership in Energy and Environmental Design) standard for design and construction, as well as the Gold or Platinum LEED standard for maintenance and operation.
The Applebee’s building qualifies on both points. The current EPA building doesn’t, and it’s unclear, according to Kansas City Star real estate writer Kevin Collison, “whether the building itself could be upgraded to meet the minimum Silver LEED requirement.”
– In the summer of 2008, about a year before the initial 10-year lease of the Minnesota Avenue building was about to expire, the GSA went to the building owners — at that time a different company — and solicited a proposal for what Cook called “a succeeding lease” in the KCK building.
When the offer came back in 2009, however, the GSA determined that “the rates were too high and the terms unreasonable,” Cook said. (By then, UrbanAmerica had bought the building.) The GSA then canceled that solicitation and informed Congress that it intended to expand the search area and prepare a new solicitation in order to increase competition and drive down the rates.
In the meantime, GSA negotiated an extension of the old lease with UrbanAmerica.
(Side note: You might be wondering, as I was, why UrbanAmerica would buy the building before a new lease was secured. “Stupid” was the assessment of one former GSA official I talked to.)
The new solicitation went out last October, and at least two proposals — those of UrbanAmerica and Lexington LAC — came back a month later.
A GSA and EPA selection panel’s evaluation of those proposals went beyond price, Cook said, to include “sustainability, building and systems design, development team experience, and development team past performance.”
On April 4, GSA and Lexington LAC officials signed a lease contract, which the GSA announced the same day.
All this isn’t giving Reardon pause.
If he can stir up enough ire and make the bureaucrats sufficiently uncomfortable, he could win the fight. He’s relying largely on two well-placed body blows to significantly weaken the GSA’s technically tilted defense.
First, he stresses the importance of the EPA within the context of an urban area that is striving for respectability.
Downtown KCK has seen vast improvements in recent years, he said, including the emergence of small businesses on Fifth Street and the 2010 opening of a $15.5 million Children’s Campus of Kansas City, where several social service groups focus on at-risk children and their families.
In addition, the Unified Government is using the proceeds of a $10 million federal grant to develop an express bus route linking downtown with The Legends/Village West complex at 110th Street and State Avenue. The downtown transit station would be adjacent to the EPA, Reardon said.
All in all, Reardon said, the EPA regional headquarters, with its 610 employees, is a linchpin to continued downtown development.
“This is exactly the wrong time for them (the EPA) to leave,” he said.
His second punch, which is a natural follow-up to the first, highlights a 1978 executive order from President Jimmy Carter. It says in part:
“Federal facilities and federal use of space in urban areas shall serve to strengthen the nation’s cities and to make them attractive places to live and work…Except where such selection is otherwise prohibited, the process for meeting federal space needs in urban areas shall give first consideration to a centralized community business area and adjacent areas of similar character…”
Yes, the GSA gave “first consideration” to downtown KCK. But did it give it enough consideration? That is a key question.