L.B. Urged to Look at Consultant Pacts Closely, Invite Bids

The city auditor said he will recommend that the city revamp its procedures for hiring consultants, including encouraging more competition for millions of dollars in consulting contracts.

Auditor Robert F. Fronke said he also plans to ask the City Council on Monday to allow his office to review terms of these contracts before they are signed.

He said huge increases in the contract of a consulting firm that monitors the building of a trash incinerator illustrate his office’s concerns about the way the city pays millions of dollars to consultants.

The contract, which began at $15,000, has swelled to $4.2 million. The city last week froze further payments to the firm, Rigo & Rigo Associates, until officials can determine whether such expenses as dinners over $200, plane trips and hotel bills are proper.

The company was hired to monitor construction of the Southeast Resource Recovery Facility, which converts trash to electricity.

In reviewing the incinerator, which advocates consider a model for solving the national garbage crisis, Rigo billed the city for travel expenses that grew from less than $1,000 a month in 1983 to an average of $11,050 a month last year. The payroll also expanded from two workers to 10, including owner Greg Rigo’s wife.

Rigo could not be reached for comment.

Fronke said the terms of the contract do not require the consultant to itemize expenses, so Rigo has technically probably not violated an agreement.

The auditor also said any questions that might be raised about the expenses should not shed doubt on the quality of the firm’s work, which he says is not in dispute.

“This is a very complex plant, there is not another one like it in California and they (the consulting firm) are the city’s technical engineers. Just because their expenses are now in question, the quality of their work shouldn’t be,” Fronke said.

The issue, Fronke said, is whether Long Beach should be more discriminating in the way it metes out contracts. He said the city tends to select a consultant based on reputation, rather than opening the field to consider several candidates, then selecting the best one.

The cost of the work, he said, is not considered until after a consultant is chosen.

“It’s like running an ad for an employee,” he said. “You advertise for several candidates and then you try to pick the best applicant. . . . There is a failure to take price into consideration.”

Rigo & Rigo Associates was selected by Bill Davis, the city’s solid-waste bureau manager, who supervises the incinerator project. The city entertained no other consultant offers, Fronke said.

The auditor’s report to the council recommends that his office be brought in to review contracts before they are signed, rather than being left to second-guess the terms when it is time to approve expenses. Fronke said his office might have called for a more specific accounting of expenses, rather than just submission of a $200 dinner receipt without telling the purpose of the meal.

“That is our job, for goodness’ sake,” he said.

Rigo’s opinions are at the center of multimillion-dollar lawsuits in which the city is suing the builders of the incinerator, the Dravo Corp. of Pittsburgh, contending that the firm failed to build the plant properly.