TAXWatch: HIDOE Achieves Success with Job Order Contracting

We’ve written a lot about the Hawaii State Watch Doggie. Those who have visited our Twitter site have seen that the Doggie is a family man, with a wife and son.  His son is five and loves to ask questions.  He also really, really, really loves to eat.

Q:  Are you reading something about my school, Dad?

A:  Not just your school.  The government is fixing the roofs on lots of schools.  And it happens really fast.

Q:  How fast?

A:  They did eight roofing projects in about eight months.

Q:  Is that fast?

A:  Normally, one project using the traditional design-bid-build method takes an average of seven years.

Q:  Why so long?

A:  The project needs to go through appropriation, design, bidding, and construction.

Q:  Why didn’t the roof projects take seven years also?

A:  They changed the process to something called “Job Order Contracting.” Instead of having the contractors bid on only one job at a time, they had the contractors give the DOE a menu.  The DOE picked a handful of contractors, and then was able to order projects off their menus.

Q:  Like how I can go into a restaurant and order a hamburger?

A:  Yes. But don’t do it now, it’s too close to dinner time.

Q:  I want a hamburger!

A:  Anyway, the DOE has lots of construction projects they need work on.

Q:  You mean when they need chores done, they don’t do them?

A:  No, they just make a list of the projects and call them “deferred maintenance.”

Q:  How much deferred maintenance do they have?

A:  At the beginning of this year, the DOE said it was $868 million.  The Boss complained about that back in January.

Q:  Wasn’t he also complaining about the University?

A:  Yes, the University of Hawaii was reporting a backlog of $722 million.

Q:  So, they didn’t do their chores either?  And that’s legal?

A:  Well, some of our lawmakers were scolding them when they came to the legislature for money.

Q:  So, is the DOE going to use this menu stuff for other things? 

A:  Yes, they will use that method for air conditioning projects next, and then electrical upgrades.

Q:  Is the method really new?

A:  Not really. The federal government has been using it for some time.

Q:  Then why haven’t we used it before?

A:  I don’t know.

Q:  Is the University of Hawaii going to use it?

A:  I don’t know. They should.  By the way, when are you going to clean your room?  

Q:  Next month. Deferred maintenance!

A:  NO!!

The MAUIWatch Community Network invites readers to express their views in the Community Viewpoint. Community Viewpoint columns should be on or around 800 words. Community Viewpoint submissions are subject to editing. We do not print letters announcing events to come, extensive quotations from other material, open letters or form letters. Send to contact (at) mauiwatch (dot) com.

Tom Yamachika is the President of the Tax Foundation of Hawaii, a private, nonprofit educational organization dedicated to informing the taxpaying public about the finances of our state and local governments in Hawaii. Tom is also a tax attorney in solo practice and has been since early 2013. Prior to 2013, he was with the accounting firm Accuity LLP, which was formed in 2006 from the Honolulu office of Coopers & Lybrand (which later became PricewaterhouseCoopers). Before that, he served as an Administrative Rules Specialist in the State of Hawaii Department of Taxation from 1994 to 1996, where he drafted rules, interpretive releases, and legislation on several different state taxes. Prior to that, he practiced litigation and tax law with Cades Schutte Fleming & Wright in Honolulu