When the Detroit/Wayne County Port Authority built the $22 million Carl M. Levin facility, named for Michigan's longtime former U.S. senator, the idea was to entice ships from the growing Great Lakes cruise market to dock there. The good news is that dockings are up; the bad news is that they're holding steady at one so far this year after coming in at zero for all of 2014.I like to say, good governance is the corner stone of good community, and good spending through good procurement is the corner stone of good governance.
U.S. Customs officials refused to staff the terminal so passengers could disembark. According to a Customs spokesperson, "The facility … has not been completed and does not meet the IT and security requirements necessary to properly process cruise vessels and/or cruise passengers. These and other issues were discussed with the Detroit Port Authority over four years ago."
Port Authority Executive Director John Loftus and Port Authority Commissioner Alisha Bell trot out the old warhorse that the facility attracts jobs and visitors. Numerous studies, of course, have documented that projects like these rarely stimulate economic activity on a level that comes anywhere close to justifying their costs.
Bell makes another argument for the project: "It's a beautiful space for weddings and events that enhances our visibility." Weddings, in fact, seem to be the terminal and dock's main business. Continental Services, a catering firm whose founders are big contributors to local officials' election campaigns, holds them there. The company also owns a luxury yacht and offers party cruises from the dock. Lest you think that the fees from weddings and party cruises cover the $22 million facility's costs, all of $140,000 was collected from the company last year.
Even though the terminal and dock isn't a city project, such wasteful spending is particularly hard to stomach in Detroit, where local residents have already endured so much. The city's 2013 bankruptcy declaration, the biggest municipal bankruptcy in American history, has forced retirees to absorb genuinely painful pension cuts. Detroit's population is down to around 700,000 from a high of 1.9 million. So much land has been abandoned that one of the revitalization strategies being pursued is urban farming.
Elective politics rarely attracts small egos, so it's only natural for officials to want to do big things. But good government is rarely sexy. Sometimes it requires resisting the siren song of projects that rely on patently unrealistic economic assumptions.
Labels and Tags
Accountability (68) Adequate documentation (5) ADR in procurement (3) Allocation of risks (5) Best interest of government (11) Best practices (19) Best value (15) Bidder prejudice (11) Blanket purchase agreement (1) Bridge contract (2) Bundling (6) Cancellation and rejection (2) Centralized procurement structure (12) Changes during bid process (13) Clarifications vs Discussions (1) Competence (9) Competition vs Efficiency (28) Competitive position (2) Compliance (32) Conflict of interest (29) Contract administration (25) Contract disputes (1) Contract extension or modification (8) Contract terms (2) Contract types (6) Contract vs solicitation dispute (2) Contractor responsibility (19) Conviction (3) Cooperative purchasing (3) Cost and pricing (13) Debarment (4) Determinations (8) Determining responsibility (33) Disclosure requirements (7) Discussions during solicitation (9) Disposal of surplus property (3) Effective enforcement requirement (34) Effective procurement management (3) Effective specifications (36) Emergency procurement (14) eProcurement (5) Equitable tolling (2) Evaluation of submissions (22) Fair and equitable treatment (14) Fair and reasonable value (23) Fiscal effect of procurement (13) Frivolous protest (1) Good governance (8) Governmental functions (26) Guam (14) Guam procurement law (12) Improper influence (11) Incumbency (12) Integrity of system (29) Interested party (7) Jurisdiction (1) Justification (1) Life-cycle cost (1) Limits of government contracting (5) Lore vs Law (4) market research (7) Materiality (3) Methods of source selection (30) Mistakes (3) Models of Procurement (1) Needs assessment (11) No harm no foul? (8) Other procurement links (14) Outsourcing (33) Past performance (12) Planning policy (33) Politics of procurement (46) PPPs (6) Prequalification (1) Principle of competition (90) Principles of procurement (22) Private vs public contract (15) Procurement authority (5) Procurement controversies series (77) Procurement ethics (17) Procurement fraud (27) Procurement lifecycle (9) Procurement philosophy (15) Procurement procedures (29) Procurement reform (59) Procurement theory (11) Procurement workforce (2) Procurment philosophy (6) Professionalism (17) Protest - formality (1) Protest - timing (11) Protests - general (35) Purposes and policies of procurement (9) Recusal (1) Remedies (16) Requirement for new procurement (4) Resolution of protests (4) Responsiveness (12) Restrictive specifications (4) Review procedures (12) Scope of contract (16) Settlement (2) Social preference provisions (59) Sole source (47) Sovereign immunity (2) Staffing (7) Standard commercial products (1) Standards of review (2) Standing (6) Stays and injunctions (6) Structure of procurement (1) Substantiation (9) Surety (1) Suspension (6) The procurement record (1) The role of price (10) The subject matter of procurement (22) Trade agreements vs procurement (1) Training (32) Transparency (60) Uniformity (5) Unsolicited proposals (2)
Tuesday, September 8, 2015
Good governance is rarely sexy
Detroit's Cruise to Nowhere, by Charles Chieppo, a research fellow at the Ash Center of the Harvard Kennedy School. Usual caveat applies: read the original story at the link, because I take liberties in presenting materials, as case studies and other teaching tools.