Records reveal the lucrative nature of local municipal consultation

A view of Scottsdale City Hall in downtown Scottsdale Tuesday, March 21. (Independent Newsmedia/Josh Martinez)

Over the last three fiscal years both the city of Scottsdale and Town of Paradise Valley have spent millions on expert opinions.

One member of Scottsdale City Council believes the city relies much too heavily on the opinions of outside consultants, whereas many in the Town of Paradise Valley believe high-priced consultants are way of life for a town with limited government and staff.

Independent Newsmedia requested all records of payments for consultant services for any municipal projects over the last three fiscal years at both the city of Scottsdale and the Town of Paradise Valley.

The request garnered receipts of hundreds of payments made for myriad projects ranging from roadway studies and recreational pathways to IT strategic plans and signage considerations.

Not included were outside legal fees paid by either municipality when claims against the municipality exceed the abilities of in-house legal representation and, most notably, in Scottsdale nothing regarding consultant services for the controversial Desert Discovery Center.

Over the last three fiscal years, and during the current fiscal year, the Town of Paradise Valley — a community of about 13,000 residents — has paid outside consultants $3,010,433, records show.

Over the last three fiscal years, the city of Scottsdale — a community of about 225,000 residents, has paid a total of $1,993,293 to outside consultants, records show.

City of Scottsdale

Of the nearly $2 million in consultant fees paid by the city of Scottsdale, the majority of payments go toward design, environmental and marketing specialties.

Top payments to consultants in Scottsdale this most recent fiscal year include a $97,269.35 payment to Places Consulting; a $68,253.62 payment to the Center for Public Safety Management; a $56,285 payment to Newgen Strategies & Solutions; and $49,200 to the Aarons Company.

Broken down by year, the city of Scottsdale paid:

  • Fiscal year 2013-14 — the city spent $746,560.93 on expert opinions;
  • Fiscal year 2014-15 — $864,674;
  • Fiscal year 2015-16 — $382,059.23.

Scottsdale Councilwoman Kathy Littlefield thinks the city of Scottsdale spends too much on consultant services.

“Everything that has a major decision to be made is sent off to a consultant, and I am not sure why?” she asked in a March 21 phone interview.

Kathy Littlefield

“Council never sees these people. They work with staff, have a selection process — whatever that is — and choose who they think is best and do their report. The only time council sees them is at the end.”

But according to the municipal procurement code — specifically page eight of that document — no expenditure under $25,000 requires city council approval.

“In addition to reviewing and approving the city’s annual budget, through which these services are paid, the city’s procurement code (Section 2-201) also requires professional services contract over $25,000 go to the city council for review and approval,” said Scottsdale Communications Director Kelly Corsette in a March 21 statement.

“The city seeks subject matter experts on a variety of topics, particularly those that require special knowledge in particular areas. These professional services allow the city to deliver a full spectrum of programs, services and projects without having to have all of that expertise on full-time staff.”

Mr. Corsette says the checks and balances of the system is gained through the attention of a contract administrator.

“Once awarded, each contract is managed by a contract administrator within the hiring department responsible for ensuring the work is performed and payments are made per the terms, scope and specifications contained in each individual contract,” he pointed out.

Councilwoman Littlefield considers a consultant as any outside, specialized company coming in to give specialized advisement on a particular topic.

“I don’t know if you call them consultants but the DDC has a consultant to help them draw plans for the DDC. I look at that as a city consultant that is getting money from the city,” she said.

Scottsdale City Council last June approved a $521,090 contract with Scottsdale-based Swaback Partners, an architectural firm, to provide programming and schematic design services for the planned desert tribute facility.

But those numbers were not included in the records request and Councilwoman Littlefield says she thinks they should have been.

“In fact the Desert Discovery Center Scottsdale Inc. is a consultant — that is what I consider them,” she said. “I think that needs to be much more closely watched.”

Swaback Partners is the same architectural firm Scottsdale City Council awarded a design services contract for the first iteration of what the Desert Discovery Center would be. In January 2010, Swaback Partners was awarded a contract of $432,000 for similar design services contract, records show.

Scottsdale Vice Mayor Suzanne Klapp says city staffers are not experts in everything — and oftentimes municipal business can be incredibly intricate and complex.

“Consultants are brought in when you don’t have the expertise internally,” she said in a March 22 phone interview. “Over the last few years, we have cut down on staff members, and when you need someone with expertise someone in city government might not have that expertise.”

Vice Mayor Klapp says the hundreds of thousands of dollars spent annually on consultants in Scottsdale is a small fraction of the millions of dollars in tax revenue that makes the municipality function.

“Two million in the scheme of things over the course of three fiscal years doesn’t sound like a large amount,” she said. “It is not an easy answer because it is a very broad question. My feeling is that there is no one hiding information from me. If I want to get information on something I can get it.”

A view of Paradise Valley Town Council hearing a presentation curated by a consultant regarding a study looking at water flows within town limits. (File photo)

Town of Paradise Valley

Of the just over $3 million paid in consultant services over the last three fiscal years — and thus far this fiscal year — the Town of Paradise Valley sought expert opinions ranging from the design of Lincoln Drive sidewalks and roadway tied to improvements at the forthcoming Ritz-Carlton resort, the formulation of a bicycle master plan and various water-flow studies.

Top payments to outside consultants paid with Paradise Valley tax revenue most recently include:

  • A $1,121,656 contract to T.Y. Lin International for Ritz-Carlton roadway improvements;
  • A $408,829 contract to Kimley-Horn to help design Lincoln Drive sidewalks;
  • A $431,000 contract to Dibble Engineering for watershed studies;
  • A $233,688 contract to Arcadis for the creation of a waste water master plan;
  • A $141,088 contract to Coffman Studios for the creation of a bicycle and pedestrian master plan;
  • A $219,306 contract to Markham Construction for the 52nd Street reconstruction; and
  • A $152,383 contract to the Environmental Planning Group for identification of a visually significant corridor plan.

In all, the Town of Paradise Valley provided Independent Newsmedia a rundown of 20 consultant contracts dating back to fiscal year 2013-14.

Paradise Valley Town Manager Kevin Burke contends consultant services are a vital part of giving local residents the services they desire.

Unlike Scottsdale, the Town of Paradise Valley has a very small paid staff and thus required to use outside consultants more than their neighbors to the east.

“Consultants, or third-party experts, are an important part of the Town of Paradise Valley service delivery model,” he said in a March 22 written response to e-mailed questions.

“We are a limited government model where volunteers outnumber paid staff. That being said, consultants should only be used when: 1) you don’t possesses the expertise; 2) you don’t possess the time or capacity; and 3) you don’t possess the credibility — in other words, any recommendation might look self-serving.”

Mr. Burke points out much of the efforts at the Town of Paradise Valley requires expertise local staff doesn’t posses.

“The town has identified and been working on some very aggressive goals and service enhancements that fall into these three conditions,” he said. “We take the expenditure of the public’s money very serious and do so only to advance well-vetted objectives.”

Similar to the city of Scottsdale, town code requires a $25,000 threshold for town council approval on consultant services.

Paradise Valley Vice Mayor Jerry Bien-Willner says he expects all duties — outside consultant or not — carried out by the town to be done to the letter of efficiency.

Jerry Bien-Willner

“My expectation for all work paid for by the town, whether from its employees or contractors, is that it is performed pursuant to the highest professional and ethical standards,” he said in a March 22 written response to e-mailed questions.

“I believe the other members of council feel the same way. When consultants or professionals are retained, they are expected to follow whatever additional guidelines, tasks and objectives may be set forth in the document or documents that define the project for which they are hired.”

Vice Mayor Bien-Willner points out the town’s procurement process follows state law. All services above $50,000 must go through a formal bid process while the town manager serves as the procurement officer for the municipality.

“The review and approval of contracts that have gone through the procurement process is typically presented publicly for the Council on its consent agenda during the Council’s meetings,” he explained.

The vice mayor, too, pointed out the limited government model employed at the Town of Paradise Valley.

“The town follows a limited government model, so we try to keep a very tight ship in terms of employee headcount,” he said. “Consistent with the high standards of the town’s residents, the council also expects “A” level performance across the board. This means that, from time to time, we require additional resources or expertise to achieve the town’s objectives, particularly with regard to specialized and/or one-time projects.”

Paradise Valley Councilwoman Julie Pace says while she understands the need for consultant services, the $3 million tally seems a bit high.

But, Councilwoman Pace points out, if the Ritz-Carlton roadway improvements were to be taken out of the Paradise Valley total — a project that is expected to add revenue to the municipality’s bottom line — numbers would be more reasonable.

“I think it sounds like we can do less consulting and more doing,” she said in a March 21 phone interview.

Julie Pace

“Sometimes consultant reports are needed. My take on it, and I am not placing this on a past council, but it seems a little heavy on the consulting sides. We want money going to solve issues.”

But with a municipality the size of Town of Paradise Valley, Councilwoman Pace says she would like to see town council evaluate more closely the value of consultant contract.

“I get that we need consultants. I think moving forward, however, the council needs to be more suspect of who these consultants are. In fairness, maybe the problem is that we sat back during the recession and things backed up.”

A limited government model requires the regular usage of outside consultants, Councilwoman Pace contends.

“We have a limited staff, so we do lean on experts who are consultants,” she explained. “That is the trade-off for limited government, but what do we get out of it that holds value. There should be some kind of benchmark to it.”

Paradise Valley Councilman Paul Dembow echoes a similar sentiment.

“I believe that $3 million is a lot of money for consultants,” he said in a March 21 statement.

“That said, if we don’t have the expertise and need it, we have little choice but to use a consultant. It makes sense that we look at the type of consultants we’re using and possibly hire a person for a position or two because that may lead to lower costs.”

Councilman Dembow says expertise is something you typically have to pay for.

“If we don’t have the expertise in an area — a good example would be storm water flooding issues — we need to know what is going on and what can be done and therefore need a consultant,” he said. “If I cut my finger I can put on a disinfectant and a Band-aid — If I need surgery I need a doctor. Our staff can do much of the work needed, but certainly not all, that is where we need consultants.”

Northeast Valley Managing Editor Terrance Thornton can be contacted at tthornton@newszap.com

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