Monday, March 25, 2013

DFA recommends Clinton

Press release from DFA:

Today, the MS Department of Finance & Administration has determined that, on the basis of receiving the highest evaluation score, the Mississippi Department of Revenue should execute a 20 year lease agreement with Duckworth Realty for the relocation of its offices to the South Pointe Building (the former Worldcom Building) in Clinton, MS. The initial annual cost to the State would be $2,878,000 resulting in a total cost of $41,428,492 (net present value) for the term of the lease agreement. This offer represented the lowest total cost to the State. The proposal submitted by Duckworth for the South Pointe Building includes 187,511 square feet of office space, 600 parking spaces, tenant improvements, security and janitorial services. The lease term would begin July 1, 2014.

Kevin J. Upchurch, Executive Director of the Mississippi Department of Finance & Administration, stated “We are pleased to have a more permanent solution to the issue of housing the MS Department of Revenue. The selection process was thorough and comprehensive. The main objectives of this process were the cost to the taxpayers, ease of access for citizens, and securing a more permanent, functional facility for MDOR employees. I am satisfied that this location meets all of those objectives.”

On November 1, 2012, DFA issued a Request for Proposal (RFP) to obtain new offices for the Mississippi Department of Revenue (MDOR) via a long term lease. A team consisting of three DFA employees and two MDOR employees was assembled to evaluate all proposals based on pre-defined calculations and scoring criteria. The State received six proposals and three were selected for further review. The three finalists were Hertz Investment Group, LLC (The Landmark Building), Ergon (Diversified Technologies Building), and Duckworth Realty (South Pointe Building).

DFA contracted with Allred Architectural Group, P.A. of Ocean Springs, MS to perform test fit analysis, building assessments, and environmental assessments of the three proposed buildings. This review was designed to determine each building’s ability to meet the needs of the MDOR. The review was also designed to identify any deficiencies within the buildings. Based on the results of these analyses, each finalist was asked to the submit a Best and Final Offer in which they were to explain how any noted deficiencies would be addressed, as well as, make any final adjustments to the initial financial offerings.

The Attorney General’s Office has reviewed the RFP process and finds no deviation from the State’s procurement laws or the Bureau of Building, Grounds and Real Property Management’s Leasing Manual. Additionally, DFA retained the services of John G. Corlew, Corlew Munford & Smith, to perform an independent evaluation audit of the procedures followed by the DFA in the RFP process. The final review determined that DFA adhered to all of the applicable statutory requirements throughout this process. Further, the review determined that calculations and scoring used to determine the final outcome were correct and strictly followed the evaluation system set forth in the RFP.

Ed Morgan, Commissioner of Revenue, stated “We appreciate that the process used to make this decision was fair and equitable. Great care was taken to make sure that the needs of the citizens of our state and the needs of the Department of Revenue were met in selecting the best location. We are pleased with the results and look forward to moving to our new home.”

The MDOR offices are currently located in privately owned leased space on Springridge Road in Clinton, MS. This lease term ends on June 30, 2014.

35 comments:

Anonymous said...

Score: Speakah Philip Gunnsmoke = WIN

Leland Speed = LOSS

Anonymous said...

Glad the MDOR will be out of that tin thing......

Anonymous said...

sucks for Jackson

Anonymous said...

Here comes the next wave of Kingfish-Speed, ah, advertisements.

Anonymous said...

ROFLMAO ... DJP whiffs again.

Anonymous said...

Perhaps in the name of business efficiency other state agencies should be dispersed to Madison, Byram, Brandon, Canton, etc. The state capitol could be moved to Pelahatchie.

Anonymous said...

It is refreshing to see so many supporters of smaller, more limited government. Of course choosing the $40 million option is more cost effective than the $7.5 option, right? Looks like the DFA and the thirty hissing possums are one in the same after all. Can this state's government do ANYTHING right?

bill said...

I haven't dug too deep on this, but how can buying a building for $7.4 million be more expensive than spending $40 million plus over the life of a 20 year lease? This is a tad smelly...

Anonymous said...

Something tells me that now that the process is open, this will be vigorously vetted to compare lease versus buy. Could get interesting.....and sticky

Anonymous said...

Kingfish, Since The State of Mississippi has $33 million to blow, do you think it would agree to pay off all my law school loans? I mean the state is obviously in a pretty generous mood, as in the more money it spends, the better. At least then, I would benefit from them making a bone-headed decision.

Anonymous said...

Total cost of $41 million comes to $220 per square foot. To put this in perspective, I heard that Parkway built the Pinnacle for around $37 million or so (excluding parking garage improvements). I believe that Pinnacle is around 190K square feet, so it comes to $195 per square foot. Great recommendation DFA. The parking, security and janitorial services much drive a helluva premium.

Anonymous said...

And 1:36, that is to LEASE not own as Parkway did.

Anonymous said...

"I haven't dug too deep on this, but how can buying a building for $7.4 million be more expensive than spending $40 million plus over the life of a 20 year lease? This is a tad smelly"

The only rationale I can see is that this would cost $2M this year (and every year thereafter) as opposed to having to come up with $7.4M. On the other hand, isn't that what bonds are for?

clintonrebel said...

Not sure why so many people believe that if they buy the Landmark center, there will be zero operational costs for the next 20 years. Things like maintenance, water and electricity. Those things come packaged in a lease. If you own it, those are all your costs. Please compare apples to apples.

Anonymous said...

1:58 get real. Do you actually think those factors have not been considered?

Anonymous said...

Since the proposal and all information in it are now sealed by court order, one can only surmise.

They sealed it to keep everyone from knowing how BOGUS it is.

Why the hell do you allow a proposal for a state agency location with costs be sealed from public view? What are they hiding?

Anonymous said...

Most long term leases have escalator clauses for taxes and insurance. So they are likely just guessing at the cost. If the State buys a building there are no taxes, but if they lease, the owner would have to pay taxes and I doubt that they will go down. Insurance will likely go up over 20 years also.

Anonymous said...

clintonrebel, the DFA statement indicates that security and janitorial are included, but does not indicate that it's a full service lease. It may be though... Who knows since the proposal is sealed.

Anonymous said...

The numbers are probably closer than you’d think.

My guess is parking was what tipped the scales for South Pointe. The garage on E. Capitol Street (owned by the JRA) is $85 dollars per month retail. It would take a giant leap in faith to assume the JRA was smart enough to offer some concession and if they didn’t:

600 spaces * 85 per month * 12 months per year * 20 years = 12.24 million

Let’s assume there was a concession and say parking was $10 million, plus $7.5 for the building, then operating expenses would have to be less than $6.25 per sq. foot per year (and I would guess $7.50 per sq. ft. annually as a baseline figure) in order for the Landmark deal to be cheaper than South Pointe. And while there would be no taxes if the State owned the Landmark building, the building is in desperate need of capital and tenant improvements above and beyond the purchase price. These costs would then fall to the state. There is a reason a building of this age sits empty… and it is years of neglect from a long distance owner.

All that said I would like to see the proposals, but I just don’t think it is as clear cut as $41 mill vs. $7.5. I really do hate it for downtown.

Anonymous said...

Not so 2:31. The DFA material says janitorial and security are additional and the lessee's responsibility.

Anonymous said...

Hey 3:06 all you have are assumptions. We need the records unsealed for Duckworth to compare. Period.

Anonymous said...

So much for transparency in government................ They want to spend our money but we don't have the right to get the details. I just don't see how they can seal these documents.

Anonymous said...

I do like moving the capitol to Pelahatchie and make Knox Ross the Governor. Aside from all of that, I'd like to point out the vast difference between $41.4 million and $7.5 million. Works out to $33.9 million for maintenance cost over 20 years or $1,695,000 per year (comparing apples to apples, of course). Also, I'd like to point out that the $41.4 million is NPV and inflated dollars over the 20 year period. ......But now that I think about it, the political subsidy tax of at least a couple million is included in that $41.4 million. Let's me conservative and make the political subsidy and payoff tax of $5 million. That's better.....

Anonymous said...

4:39
so you and the chicken Plucker are in agreement, he thought the Overlay was a bad investment.

MWA said...

“While this is an exciting day for Clinton, our state government continues to lack any strategic plan for locating agencies, saving money, and consolidating office space,” he [Blount] said in a press statement. “Decisions are made on an ad hoc basis, often influenced by who holds the most political power at the moment.“

And it ain't you Blount!

Why didn't the suddenly cost-of-government conscious Senator previously introduce legislation in his other 5 legislative sessions to consolidate office space?

Anonymous said...

Because he was not Chairman of the Public Properties Division then, with blessings from the Lt. Gov. then oh ignorant one. IE: he had no clout then.

Anonymous said...

7:01 thank you.. I love it when factual people call out stupid people.

MWA said...

Whatever you say Einstein. You don't need a chair to introduce legislation and, by the looks of Blount's stellar work this year, he has no more clout than he did before Reeves.

Anonymous said...

MWA are you stalking AGAIN????!

Anonymous said...

Which value is greater, $40 million or $7 million? If you correctly guessed $40 million, then you must be over-qualified to work for the DFA. Pathetic.

Anonymous said...

Check out RFP 4000, which is also sealed. RFP 4000 is a 10 year eclusive contract for network services that AT&T won and it is also sealed. The prices for Internet service are $23/Mbps and market rates are 50-60% less than that today. Not to mention other network services that state agencies, (we the tax payers) are spending too much for. The gubment continues to stick it to the taxpayer.

Anonymous said...

Haha it's sad when our state government is almost as bad as Jackson's government at making economical decisions... And why is it that Mississippi struggles to attract industry again?

Anonymous said...

"Downtown is dying"

- Ben Allen
- MS Business Journal
- January 28, 2013

Anonymous said...

5:33: congratulations... Did you celebrate that last night?

Anonymous said...

The problem is in our statutory requirements.

You might ask construction and government procurement attorneys in MS what changes are needed to make the state bidding process more competitive. Many have been recommending changes for decades and the bid protests made reflect the problems.

Ironically, Mississippi companies are often damaged in favor of out of state companies as the monetary value of keeping the tax dollars at work in the state is never part of the equation.



Recent Comments

Search Jackson Jambalaya

Subscribe to JJ's Youtube channel

Archives

Trollfest '09

Trollfest '07 was such a success that Jackson Jambalaya will once again host Trollfest '09. Catch this great event which will leave NE Jackson & Fondren in flames. Othor Cain and his band, The Black Power Structure headline the night while Sonjay Poontang returns for an encore performance. Former Frank Melton bodyguard Marcus Wright makes his premier appearance at Trollfest singing "I'm a Sweet Transvestite" from "The Rocky Horror Picture Show." Kamikaze will sing his new hit, “How I sold out to da Man.” Robbie Bell again performs: “Mamas, don't let your babies grow up to be Bells” and “Any friend of Ed Peters is a friend of mine”. After the show, Ms. Bell will autograph copies of her mug shot photos. In a salute to “Dancing with the Stars”, Ms. Bell and Hinds County District Attorney Robert Smith will dance the Wango Tango.

Wrestling returns, except this time it will be a Battle Royal with Othor Cain, Ben Allen, Kim Wade, Haley Fisackerly, Alan Lange, and “Big Cat” Donna Ladd all in the ring at the same time. The Battle Royal will be in a steel cage, no time limit, no referee, and the losers must leave town. Marshand Crisler will be the honorary referee (as it gives him a title without actually having to do anything).


Meet KIM Waaaaaade at the Entergy Tent. For five pesos, Kim will sell you a chance to win a deed to a crack house on Ridgeway Street stuffed in the Howard Industries pinata. Don't worry if the pinata is beaten to shreds, as Mr. Wade has Jose, Emmanuel, and Carlos, all illegal immigrants, available as replacements for the it. Upon leaving the Entergy tent, fig leaves will be available in case Entergy literally takes everything you have as part of its Trollfest ticket price adjustment charge.

Donna Ladd of The Jackson Free Press will give several classes on learning how to write. Smearing, writing without factchecking, and reporting only one side of a story will be covered. A donation to pay their taxes will be accepted and she will be signing copies of their former federal tax liens. Ms. Ladd will give a dramatic reading of her two award-winning essays (They received The Jackson Free Press "Best Of" awards.) "Why everything is always about me" and "Why I cover murders better than anyone else in Jackson".

In the spirit of helping those who are less fortunate, Trollfest '09 adopts a cause for which a portion of the proceeds and donations will be donated: Keeping Frank Melton in his home. The “Keep Frank Melton From Being Homeless” booth will sell chances for five dollars to pin the tail on the jackass. John Reeves has graciously volunteered to be the jackass for this honorable excursion into saving Frank's ass. What's an ass between two friends after all? If Mr. Reeves is unable to um, perform, Speaker Billy McCoy has also volunteered as when the word “jackass” was mentioned he immediately ran as fast as he could to sign up.


In order to help clean up the legal profession, Adam Kilgore of the Mississippi Bar will be giving away free, round-trip plane tickets to the North Pole where they keep their bar complaint forms (which are NOT available online). If you don't want to go to the North Pole, you can enjoy Brant Brantley's (of the Mississippi Commission on Judicial Performance) free guided tours of the quicksand field over by High Street where all complaints against judges disappear. If for some reason you are unable to control yourself, never fear; Judge Houston Patton will operate his jail where no lawyers are needed or allowed as you just sit there for minutes... hours.... months...years until he decides he is tired of you sitting in his jail. Do not think Judge Patton is a bad judge however as he plans to serve free Mad Dog 20/20 to all inmates.

Trollfest '09 is a pet-friendly event as well. Feel free to bring your dog with you and do not worry if your pet gets hungry, as employees of the Jackson Zoo will be on hand to provide some of their animals as food when it gets to be feeding time for your little loved one.

Relax at the Fox News Tent. Since there are only three blonde reporters in Jackson (being blonde is a requirement for working at Fox News), Megan and Kathryn from WAPT and Wendy from WLBT will be on loan to Fox. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both and a torn-up Obama yard sign will entitle you to free drinks served by Megan, Wendy, and Kathryn. Get your tickets now. Since this is an event for trolls, no ID is required. Just bring the hate. Bring the family, Trollfest '09 is for EVERYONE!!!

This is definitely a Beaver production.


Note: Security provided by INS.

Trollfest '07

Jackson Jambalaya is the home of Trollfest '07. Catch this great event which promises to leave NE Jackson & Fondren in flames. Sonjay Poontang and his band headline the night with a special steel cage, no time limit "loser must leave town" bout between Alan Lange and "Big Cat"Donna Ladd following afterwards. Kamikaze will perform his new song F*** Bush, he's still a _____. Did I mention there was no referee? Dr. Heddy Matthias and Lori Gregory will face off in the undercard dueling with dangling participles and other um, devices. Robbie Bell will perform Her two latest songs: My Best Friends are in the Media and Mama's, Don't Let Your Babies Grow up to be George Bell. Sid Salter of The Clarion-Ledger will host "Pin the Tail on the Trial Lawyer", sponsored by State Farm.

There will be a hugging booth where in exchange for your young son, Frank Melton will give you a loooong hug. Trollfest will have a dunking booth where Muhammed the terrorist will curse you to Allah as you try to hit a target that will drop him into a vat of pig grease. However, in the true spirit of Separate But Equal, Don Imus and someone from NE Jackson will also sit in the dunking booth for an equal amount of time. Tom Head will give a reading for two hours on why he can't figure out who the hell he is. Cliff Cargill will give lessons with his .80 caliber desert eagle, using Frank Melton photos as targets. Tackleberry will be on hand for an autograph session. KIM Waaaaaade will be passing out free titles and deeds to crackhouses formerly owned by The Wood Street Players.

If you get tired come relax at the Fox News Tent. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both will entitle you to free drinks.Get your tickets now. Since this is an event for trolls, no ID is required, just bring the hate. Bring the family, Trollfest '07 is for EVERYONE!!!

This is definitely a Beaver production.

Note: Security provided by INS
.