Exclusive: Debris Debacle In Keys After Gov. Scott Issues Emergency DOT Contract
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FLORIDA KEYS (CBSMiami) – On a recent Sunday afternoon, Randy Perkins was standing alongside U.S. 1 in the Florida Keys when he spotted a large dump truck heading south.
"See that," he said, pointing to the truck. "Yesterday that truck right there was working for AshBritt in Monroe County and it was hired away from us this morning. So I lost another truck again today."
AshBritt is the name of Perkins' company, one of the largest debris removal firms in the country. Perkins claims he has lost dozens of trucks, and the crews that go with them, because they have gone to work for his two competitors in the Keys – MCM and Community Asphalt.
Why would the drivers and crews leave Perkins for the other firms?
Because they can make a lot more money thanks to a never-before seen contract put out by the Scott Administration immediately after Hurricane Irma. The emergency contract, uncovered by CBS4 News, dramatically raises the cost of cleaning up the Florida Keys. And it came at a time when Governor Scott was publicly claiming his Administration was holding the line on costs and demanding debris removal firms not raise their rates.
Under the emergency contract awarded through the Florida Department of Transportation, MCM and Community Asphalt are being paid anywhere from three to 10 times more to do the same work that AshBritt is doing under a separate agreement the firm has with Monroe County.
"What [the Florida Department of Transportation] did with this emergency bid at the Governor's direction was they upset the market condition from being able to get work done here," Perkins claimed. "What they did here caused tremendous harm to the rest of the state of Florida."
It is believed that the debris removal rates for these emergency contracts are the highest being paid for anywhere in the state of Florida.
Take for example refrigerators. Thousands of refrigerators were destroyed in the Keys because of Hurricane Irma. Under its contract with Monroe County, AshBritt receives, between $73 and $114, for every refrigerator it hauls away.
Under the Governor's emergency DOT contract, Community Asphalt is paid $250 to remove a refrigerator from the Keys while MCM is paid as much as $969.
"You can't even begin to justify how outrageous that one line item is," Perkins said.
The same goes for removing hazardous trees. The Monroe County contract pays AshBritt $295 to remove a hazardous tree that measures 36 inches in diameter.
A tree 36 inches in diameter under the Scott Administration's emergency contract will cost taxpayers $1,500 if Community Asphalt removes it and $1,950 if it is hauled off by MCM.
A 32 foot boat that was destroyed in the storm and needs to be removed will cost taxpayers $3,200 under the contract AshBritt has with the City of Key West.
Under Scott's emergency DOT contract, Community Asphalt will charge taxpayers $16,000 to remove a 32-foot boat and if MCM removes it the company will receive $20,672.
For construction debris removal, AshBritt receives between $20 and $27 a cubic yard.
MCM is paid $55.80.
Daniel Munilla, general counsel for MCM, issued the following statement: "In general, our rates were determined through a public bidding process with MCM basing its bid prices on internal estimates, resources, logistics and rates received from subcontractors considering the difficulties of working in the Florida Keys coupled with the devastation caused by Harvey and Irma and the several emergency declarations issued throughout the US which severely impacted available resources."
And as high as the numbers were in the MCM bid, Munilla noted the state was actually willing to pay even more. "We understand the bid process resulted in FDOT awarding the Work to the three lowest of 6 bidders who submitted bids; MCM provided the second lowest bid of the competition," Munilla said. "We understand that the third lowest bidder, whose bid was substantially higher than MCM's, ultimately did not end up participating in the Work."
Contacted by phone, John Morris, the president of Community Asphalt, declined to discuss his rates, referring all questions to the state Department of Transportation.
A DOT spokesman said the higher prices were based on "a variety of factors."
A spokeswoman for the Governor said Scott is working tirelessly to help the state rebound after the storm.
"One of our top focuses has been on making sure debris from the storm is quickly cleared so families and communities can rebuild," said Lauren Schenone, a spokeswoman for the Governor.
Rick Scott's handling of Hurricane Irma is expected to be a key component of his campaign next year if he decides to run for the United States Senate against Bill Nelson. Scott was a constant presence on television before the storm urging folks living in evacuation zones to leave. Following the storm he has crisscrossed the state promising to speed the recovery along while at the same time protecting the interest of taxpayers.
On September 22, twelve days after the storm hit, Scott said: "This week, I have heard from many local communities from across the state that believe they are being price gouged by debris removal contractors. Many mayors have told me there are companies not following contracts by removing debris. We will not tolerate any attempt by businesses to take advantage of our communities during their time of need, especially in the wake of a natural disaster like Hurricane Irma."
Scott demanded that companies honor their contracts and the rates they negotiated with cities and counties before the storm.
A CBS4 News investigation however found that the Governor did not hold himself or his Administration to that same standard. As a result, taxpayers will end up spending millions – if not tens of millions – more on debris removal in the Florida Keys.
It also may have had the unintended consequence of delaying clean up and raising prices in other parts of the state.
On September 12, two days after Hurricane Irma made landfall in the lower Keys, the Governor's transportation secretary, Mike Dew, quietly issued an emergency Invitation to Bid to only a handful of companies asking them to come up with a new set of prices to remove debris from the Florida Keys.
And while that may seem reasonable – after all the Keys were devastated – what is important to remember is that Monroe County as well as cities such as Islamorada and Key West already had in place contracts with companies like AshBritt to remove debris.
And if those companies couldn't handle the work, the Florida Department of Transportation had its own list of additional companies to come in and help at rates that were negotiated before the storm.
So what the Governor and the Transportation Secretary did without any public announcement, or open bidding process, was disregard all those companies and issue new, emergency contracts.
Less than 24 hours after the emergency Invitation to Bid went out the process was over and two companies were selected. Those companies – MCM and Community Asphalt – now control nearly two-thirds of all of the debris removal in the Keys.
The remainder of the Keys is being cleaned up by AshBritt – the only company that remains from the original group that were in place before the storm.
A DOT spokesman defended the need for an emergency contract, claiming they couldn't rely on the contracts negotiated before the storm.
"The pre-event contracts that FDOT has in place include a variety of services and are not strictly focused on debris removal. They are able to be implemented to supplement internal FDOT crews to immediately cut and toss the debris to clear roadways following a storm," DOT spokesman Dick Kane, wrote in response to a series of questions by CBS4 News. "FDOT then issued emergency contracts focused solely on debris removal following state procurement requirements. FDOT solicited multiple bids to ensure transparency even though it is not required during emergency procurements. For example, in Miami-Dade and Monroe Counties, FDOT solicited bids from six pre-qualified vendors that they believed would complete the job in a safe and efficient manner."
He also said the emergency contract resulted from a request by Monroe County.
"On September 12th, FDOT received a request from Monroe County for assistance," Kane wrote.
Roman Gastesi, the county administrator for Monroe County, however said he was surprised by the Governor's emergency DOT contract. He was even more shocked when he learned the Governor and the Transportation Secretary claimed that county's emergency manager, Martin Senterfitt, had requested it.
"He didn't ask DOT to come in and take over," Gastesi said.
By the time county officials realized what was happening the new emergency DOT contract was already in place," Gastesi said.
"I realized if DOT is going to come in and play the hero, then okay let them come in and play the hero," Gastesi said. "Who those trucks belong to and who is driving them, I really don't care."
Gastesi said he heard the rates under the emergency contract were high but he didn't realize how high they were until CBS4 News provided him the numbers.
"It is a little squirrelly and a little weird, yeah," he said. "But the work is getting done."
And because it is a state contract, the state is paying the higher rates. Ultimately, the state will ask the federal government to reimburse them for the cleanup.
Perkins, however, warns the state may not get reimbursed if FEMA believes the rates under the Governor's emergency DOT contract are deemed too high.
"When they see what's taking place I'm 100 percent confident that they are going to disallow funding to the DOT for what is taking place [in the Keys] because it is outrageous," Perkins said. "It's not reasonable, it can't be justified."
Perkins is facing his own criticism. Attorney General Pam Bondi has issued a subpoena for records from AshBritt and is investigating the company for possible price gouging. The company is charging some cities in Broward and other parts of the state more than their previously agreed upon rates.
Perkins said he had to renegotiate the price because he's fighting to keep his crews and trucks working for him.
He added what he is being paid now in Broward and other places is still low compared to the amount the Governor's emergency contract is paying down in the Keys.
"At the end of the day, when things settle down and the dust settles and the recovery is finished any allegations that were made against my company or me personally will be proven false," he said.
Perkins has also faced criticism for his company's work during Hurricane Katrina and Super Storm Sandy.
Perkins ran for Congress last year as a Democrat in Palm Beach County but he has also been a major contributor to Republicans. He said he has donated nearly $500,000 to Governor Scott over the years.
"Which by the way, if the Governor wants to give that money back he can give it back and I'll donate it to the Boys and Girls Clubs of Monroe County," Perkins said. "So challenge to him."
Late Thursday, the Governor's office responded to the story. The statement read:
"This evening, WFOR aired a completely one-sided story on the debris removal process in Monroe County. They claim that the state misused tax dollars to remove debris. That is false.
Prior to Hurricane Irma, counties entered into contracts with debris removal companies. After the storm, the Governor heard from many local communities, including Monroe County, that many of these companies were not providing the agreed upon service and were demanding higher prices. This is unacceptable.
Following a request for assistance from Monroe County, and because it was absolutely critical to clear roadways in the Florida Keys so families could begin to rebuild their lives, the Governor directed the Department of Transportation to immediately begin debris removal in Monroe County and activated 400 National Guard members for the same purpose. Through this process, FDOT entered into emergency debris removal contracts, which they must do to have the personnel and equipment to clear roads. Although not required to do so due to the state of emergency, FDOT went above and beyond emergency procurement requirements to competitively solicit multiple bids from pre-qualified vendors that could safely and efficiently respond to Monroe County's immediate debris removal needs.
Governor Scott will continue to fight for consumers - not businesses who attempted to take advantage of their communities after this massive and deadly storm. The Governor appreciates Attorney General Pam Bondi investigating complaints of price gouging and working to protect families.
He's glad that that the Florida Keys met his goal of reopening on October 1, and will continue to work to ensure that every family in Florida can completely recover."
