When the Savannah-Chatham School Board agreed to pay JE Dunn/Rives E. Worrell construction company $21 million to build a new Hesse Elementary campus, they believed the 50 percent JE Dunn/Rives E. Worrell promised to women- and minority-owned subcontractors would make a huge impact on the local economy.

Now, that's open to question.

"Where there is money, there are a lot of games played," said Rebecca McClain, the school system's chief financial officer. "Construction has always been one of those areas."





Noble but toothless

The Savannah-Chatham public school system just completed its first $310 million education sales tax-funded school improvement campaign called ESPLOST and has just begun ESPLOST II, which promises to devote another $350 million to school improvements and construction.

When awarding ESPLOST contracts, school officials have given preference to companies that pledged to work with significant numbers of businesses owned by local women and minorities. They believe it is a unique opportunity to help those businesses grow and contribute to Chatham County's economy.

Six months ago they approved a more detailed policy and created a position for a compliance officer - still unfilled - to oversee enforcement of the policy.

Even if a compliance officer is hired, school officials acknowledge, construction companies know it is difficult for the district to legally require them to do business with someone based on race or gender. As a result, they say, their WMBE policies have been little more than suggestions.

"It's a good faith effort," said Vanessa Miller-Kaigler, the school system's facilities management executive director. "We ask that you adhere to the spirit and intent of our WMBE policy, and when folks are honest, it benefits everyone. It is worth it."

Search a list of WMBE companies in Savannah and Chatham County.

It doesn't always work the way it is intended when people don't do what they promised, she said.

A recent example is the contract to build Hesse Elementary School.

McClain said the final contract for the Hesse job was between the school district and JE Dunn/Rives E. Worrell. It didn't include mandates about hiring subcontractors - women, minority or otherwise. And the bid document, which promised 50 percent WMBE participation, was just an agreement to agree and not legally binding, she said.

However, district officials took JE Dunn/Rives E. Worrell at their word when they made their pledge of 50 percent WMBE participation.

"I would expect that they plan to do that," McClain said.

School officials can't be certain until JE Dunn/Rives E. Worrell begins to submit pay applications for completed work. Then they will be able to track how much money they are actually paying to women and minority subcontractors.

If contractors fail to follow through on minority participation, the district can't react by breaking their contract, McClain said. It would waste too much time and money, she said, and the district's first priority is building schools on time and on budget.

The only real potential consequence for any contractor who might get caught fudging their WMBE numbers is the threat of losing out on future business.

"The penalty is that we won't do business with you in the future," McClain said. "If you're the contractor, you're going to want to use us as a reference on other projects, and you're going to want to do some more projects for us down the line."





The bidding game

Last year JE Dunn, a huge California-based construction firm, teamed with the local firm Rives E. Worrell, which built the original Hesse facility in the 1950s. As primary contractors, JE Dunn had the capital required to become bonded for the multimillion dollar project, and Rives E. Worrell's local ties appeared ideal for keeping tax dollars in the community.

Their winning proposal also indicated Satori Construction, their Savannah-based partner owned by African-American Michelle Jervey, would help them share the work and wealth with small minority- and female-owned subcontractors in the area.

In their proposal, Ryan E. Price, vice president of JE Dunn/Rives E. Worrell, swore under penalties of perjury that the $21 million would be shared with nine local women- and minority-owned businesses. JE Dunn/Rives E. Worrell said the company intended to enter into a formal agreement with each of those businesses and listed them by name and percentage of participation.

"The undersigned will enter into formal agreement with the Local and/or Disadvantaged Business Enterprise Subcontractors/Proposers identified herein for work listed in this schedule conditioned upon execution of a contract with the Savannah-Chatham County School District," the form read.

Price signed it and had it notarized.

The school system's procurement team awarded Rives E. Worrell's bid proposal an extra 20 points for that pledge. They ultimately outscored seven other bidders and were awarded the contract.

Nine months after JE Dunn and Rives E. Worrell officials submitted their winning bid and six months after their contract was approved by public school officials, Satori Construction had been dropped from the project.

Women and minority business owners on the participation list said no one had contacted them about the Hesse project and they had no idea JE Dunn/Rives E. Worrell had pledged to contract with them.





Empty promise?

In January, Satori's Jervey told the school board she was working as a minority partner with JE Dunn/Rives E. Worell as a partner on several government contracts and was fired from all of them after pointing out that they were not complying with minority contracting policies on the county library project. She says she is owed $700,000 for the Hesse contract and claims she was never paid $186,000 from the Memorial Medical Center construction contract.

Gina Mincey owns Clifton Construction, which was slated to undertaker 10 percent of the $21 million Hesse project. She said she was still waiting to hear from JE Dunn/Rives E. Worrell.

"I didn't know I was on the list until I heard it from another WMBE; so I called them about a week ago to see if they needed figures or something because I really need the work," said Mincey. "They said they'd get back to me."

Black male-owned Diaby Electric, Economy Masonry and KJ's General Contractors Inc. were listed for 7 percent, 6 percent and 5 percent respectively.

"I'm listed for 5 percent of a $21 million contract for Hesse School? Wow, I didn't know a thing about it," said Kenneth Jenks of KJ's General Contractors Inc. "I guess if they didn't call me about my contract, they won't be calling about my check."

"I haven't had any contact with them about Hesse," said Earnest Wright of Economy Masonry. "If I get any of it, more than likely they'd have me working under a prime masonry contractor."

"I wasn't aware of it until other contractors on the list told me to look it up. I was down for 7 percent. That's $1.4 million," said Tidian Diaby of Diaby Electric. "But when I called their general contractor, they acted like they never heard of it. They said they'd be having a meet and greet, but they never gave me a date, and that's where we left it. I want to be in on it, but this isn't how it usually works."

American Clearing Inc., owned by a black female, and ABC Waste, owned by a white female, were both listed at 5 percent. Rose Dempsey of American Clearing Inc. said she was told she could attend a meet and greet with the construction project team.

"I was never contacted by them. When I called them, they told me about a meeting," she said. "So until then I guess I won't know anything about what I'm going to get or do."

Carolyn Stewart of ABC Waste said she read about the contract on the company's website.

"No one from there has called us yet," she said. "I don't know how it normally works, but we're excited about the opportunity."

Both Asian female-owned Thrifty Supply and black male-owned Coastal Empire Cleaning were down for 1 percent, which would bring them each $210,000.

However, the phone number for Coastal Empire Cleaning is disconnected, and Carol Chen of Thrifty Supply said she didn't know she was on the list.

"That's great, but nobody told me," Chen said. "I'd better give them a call. What did you say their name was?"





Explanations and excuses

Price now says he doesn't know how much minority participation JE Dunn/Rives E. Worrell will be able to fit into their budget, and he has backed away from their pledge to contract with the nine WMBE firms listed on their winning contract proposal.

But he denied misrepresenting the company's minority participation plans.

He said the nine WMBE contractors were eventually contacted. And although they weren't offered contracts, Price said they were invited to public outreach events where details about bidding for work were made available.

Price said his promise to include the nine minority firms in 50 percent of the project was a "proposed goal" that was developed "based on limited project information."

Before JE Dunn/Rives E. Worrell commits to work with any local women or minority subcontractors, Price said, they must first determine the guaranteed maximum price for the Hesse project. At that point, if the nine WMBE contractors can do the work that's needed, they can bid for job opportunities with all other interested sub-contractors.

"We do intend on maximizing WMBE participation and providing opportunities to as many WMBE subcontractors as possible," Price said. "The firms we listed in our proposed schedule are firms we have worked with previously and are firms we propose reaching out to for final pricing upon receipt of the completed design and if the design includes components these subcontractors and vendors supply."

All subcontractors will be invited to competitively bid for work on the Hesse School project between May 27 and August, according to Price.

But that's not what public school officials understood to be true when they awarded them the $21 million Hesse contract.

If public school officials come to believe the representative of JE Dunn/Rives E. Worrell willfully made a false statement in order to win the Hesse School bid, they could call for an investigation, said Chatham County District Attorney Meg Heap.

"It's a felony," she said. "The penalty is one to five years."

And if the subcontractors who were listed to receive 50 percent of the project are not offered contracts for the amounts promised, they might have grounds for a civil suit, as well as the contractors who bid for the job against JE Dunn/Rives E. Worrell and lost, Heap said.





Not giving up

Because WMBE contractors complained that they were denied a fair share of the public school system's first ESPLOST, school board member Connie Hall pushed the board to develop a strong WMBE policy and hire a compliance officer.

The district's new WMBE policy was approved Nov. 10, 2013, just three months after the JE Dunn/Rives E. Worrell contract was approved. They now have a new form and process for contractors to use when submitting WMBE participation plans on their proposals.

The compliance officer position has yet to be filled, but officials say that person will be responsible for monitoring projects from start to finish, which they believe will help ensure that companies are truthful in their bid proposals. It will be the first time the district has a staffer dedicated solely to following up on contractor promises to employ certified women and minority subcontractors.

"I am hoping that our WMBE policy will provide our women and minority business owners the opportunity to successfully bid on our projects and strengthen their capacity to take on bigger and more lucrative contracts in the future," Hall said.

"Most importantly, I hope our procurement team will work with our new compliance officer to ensure that the spirit, as well as the letter of our policy is upheld, and that the city and county policies will mirror ours in sending out a strong message of inclusion."