On Tuesday, the VI Public Finances Authority voted to extend a contract with CH2M for project and construction management services related to the management of bundled disaster recovery projectsThe agreement, which will last three years, will cost the area more than $137 million.

CH2M was an engineering company providing consultancy, design, construction and operational services to companies and governments before being acquired by the Jacobs Engineering Groupbased in Dallas, Texas.

“These numbers are a little shocking, but we’ve looked at a lot,” said Adrienne Williams-Octalien, director of the Office of Disaster Recovery, explaining that project management services are typically billed at 5% of total construction costs. “We’re looking at $8 billion worth of projects in the bundles, as well as construction management of projects that are already contracted,” Williams-Octalien noted, which, if calculated at 5%, would mean a fee of $400 million.

Kevin O’Neale, PFA Secretary, questioned how the proposed “super projects” would handle customs and excise clearance for the bulk materials expected to be imported for the repair work. “How do they plan to handle bulk materials for different government agencies that have different clearance procedures?” he asked.

“We’re not looking at multiple agencies trying to clear individually,” Ms. Williams-Octalien responded, echoing the ethos of the Super Project Management Office. “We’re looking at centralization and developing processes that determine how we can do clearing and some of these other challenges that we’ve identified more quickly,” she explained. Someone will be hired to lead the logistics “and create those efficiencies by meeting with those stakeholders and developing streamlined processes.” CH2M Hill “also has strategies that they’ve shared with us for the overall supply chain,” the ODR director noted.

In addition, once the first package is contracted, the Virgin Islands government will “begin to look at our internal government…(and see) what can be streamlined,” Ms. Williams-Octalien said. “We have much more control over the government side of things than we do over the external side.”

PFA board member Dorothy Isaacs was concerned about ensuring that the contractors selected to do the physical work of these construction projects are capable of doing the jobs they are hired to do. She cited the Donoe Housing development project as “one that has come to a complete standstill despite the fact that we spent millions of dollars on it’, as an example of a costly failure that has still not resulted in habitable homes for residents.

Ms. Williams-Octalien explained that the project had been stalled by unforeseen environmental issues, which necessitated a change of contractors and a search for additional funding. However, she pointed to the Super PMO as the vehicle to address “those types of issues or environmental issues, supply chain issues, labor force issues, that are causing the delays that we’ve experienced on these projects.” CH2M, she said, “is stretching our resources to make sure that we have the skilled professionals to do the construction management,” which would include proper planning of construction timelines and thorough vetting of contractors.

The ODR director said the large project bundles are also only being offered to contractors who can meet bonding requirements, and so smaller companies that might be hired to work on the projects would be covered. That’s why CH2M needs to be brought on board quickly, she said, to “help us evaluate bids, develop a scope of work, and make sure we have the right plan in place to address staffing issues, supply chain issues, and even the housing issues that we know we’re going to face.”

Because the board had no objections, approval was granted for the three-year, $137,235,258 contract with CH2M Hill, a subsidiary of Jacobs.