No, I do want to hear what else you have to say but I do want you to answer that.
The RFP was publicly advertised, including in the Philadelphia papers and all the regional newspapers in this area. And the contractors that responded were the contractors that we reviewed.
Councilwoman, Councilwoman, if I may. It's just that I -- I'm -- just on this very specific thing because Keating was hired to be project management consultant for the Kvaerner project. Define that. They were not hired to be monitoring of the MBE, the WBE, the minority hiring process, they were hired to be project management consultants.
That's correct. 53 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734
Define that. This is being very obfuscating terminology here.
Define the fact -- they were hired to oversee the building of the Kvaerner Shipyard, period.
The construction manager oversees the building of the shipyard.
Well, define it then, define what it is, define what a project management consultant is.
The project management consultant is intended to provide PSDC, including me and the board of directors, with information regarding all of the contracting that Kvaerner will do on the shipyard. 54 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 They attend contractor meetings, they attend bid meetings, they receive daily reports from Kvaerner as to the status of the shipyard, they review and report to me on each of the contracts that Kvaerner is letting, and they also advise me specifically on the release of funds to Kvaerner, which, as you know, all funding for this project comes through PSDC. So unless I receive a report from Keating which supports the request for disbursement for Kvaerner on construction, Kvaerner doesn't get its money. So that's the consulting work that Keating does for PSDC. So they take an intimate view of everything's that is going on, but they make no 17 decisions on the contract. They provide advice to me exclusively.
Councilwoman Clark is going to finish up her yield question, and then we'll go back to Councilwoman Tasco.
Okay. Now we're qualifying Keating to have an informed opinion on what is a sufficient level of minority, female, and disabled participation. 55 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 Please tell me, who is Keating's minority business partner or women business partner or disabled business partner? Do they have any? And if so, what are their names?
I think I need to go back to the first part of your question. The specific minority goals and goals for women aren't defined in the master agreement. So Keating is not in the business of freelancing on this or any other aspect of the project. The specific objectives that Kvaerner is to meet are specifically defined in the master agreement, so they don't come up or make up their own objectives or --
In other words, you're answering a question that I didn't ask you, as interesting as your answer is. Now let me see if I can get you to answer my question. What is Keating's own record with respect to minority, women, and disabled business partners?
I believe Keating has a very good record. I don't happen to have with me a -- 56 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734
Well, I'm not sure that -- I'm not sure that the question is -- is --
'Cause I'm reading it off a piece of paper, so I can repeat this at many times.
Yes. My name a Harold Rafdal, and I'm the President and CEO of Kvaerner Philadelphia Shipyard. And please bear in mind that I might have some problem in answering your questions because I'm not a native American, so I may have some problem with the language. But anyhow, PSDC's role is to follow up 57 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 Kvaerner on behalf of this agreement. In this agreement, it is stated that we have a good-faith effort to use minorities, and there are certain goals on it, yeah? And we have hired as our own consultants Urban Coalition to follow up and monitor on behalf of what we are dealing, so that we have consultants both on board, working on behalf of me, that know this environment, that have a long experience.
Fine. Can I stop you right there, sir? Can I stop you right there? Because I think that is an admirable way of doing business. You have picked someone who has background, experience, and interest in doing what you hired them to do, correct? That's why you got the Urban Coalition, Urban Affairs. Tell me why you got Keating.
Keating Building Corporation went through a very rigorous assessment process by a team of the -- comprised of the board of directors of PSDC.
Mr. Benko, before you go way down that path -- 58 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734
'Cause I know Councilwoman Clark a little bit better than you do. I don't think -- you're answering a couple questions down the road. The Councilwoman did not ask you, How did you get to Keating? The Councilwoman asked you, What did you get them for?
What are they there for? She didn't ask you how you got them. She's asking you what they're there for in the first place.
We don't need to know about the rigorous tests that you went through to get them.
She wants to know, what is their role, what is their responsibility, what are they there for? That's the question. 59 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734
Keating Building Corporation serves as the project management consultant on the construction side for PSDC.
It's the physical buildings on the shipyard, not building ships.
Now, in that capacity, Keating is, on a day-to-day basis, engaged in reviewing all of the contracts that Kvaerner lets or is proposing to let for the shipyard.
Okay. And so then the question is -- not to beat up on Keating. I mean, you hired them, you know, for whatever reasons. But why do you have Keating doing that versus PSDC doing that or someone else who is a 60 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 direct party to this piece of business?
I think that's the concept we're trying to understand.
Councilman, the point you're missing is that Keating works for PSDC. We have them under contract to perform this responsibility for us.
So that we do not have to build a bureaucracy to carry on this function. PSDC is a temporary organization; it's not going to be here after the yard is constructed, at least the staffing.
Right, I understand. That's what gives us concern. Councilwoman Clark.
On the point of PSDC, who do you consider you work for?
Of. . . ? 61 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734
Now, if I read your first paragraph of your testimony, you say, in main part, that it would be best to have one entity represent government parties. Did you reckon those government parties to be the City of Philadelphia, including City Council?
The City of Philadelphia, an entity, as a party to the contract.
The City of Philadelphia as represented by the mayor, who signed the contract.
Did you recognize it as including City Council. The mayor and City Council represents the City of Philadelphia. Or 62 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 did you think that when you had spoken with the mayor, that was all you needed to speak to?
Well, our understanding, when the mayor signed the contract, was that it was with the advice and approval of City Council, so he was -- I think that's a question to be taken up internally by the City.
No, no, just answer my questions; don't give me advice I don't ask you for, just answer my question. So you did not feel that when you said nobody from City Council had ever called you that we had been derelict in our duties in any way, did you?
You must have had some reason for bringing up the fact that no 20 member of Council had called you. What did you mean by that comment?
Well, I meant that I was surprised that some of the Council had indicated concerning PSDC, I would have been more than willing to come to your office to describe our 63 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 roles and functions or whatever we were doing at any time, if you would have asked.
Say it again, sir? You would have answered us at any time if we had asked?
Had I been asked, I would have been more than happy to sit down with you at any time, at any place, and describe what PSDC is doing.
But you're here now and you don't look that happy about it, to tell you the truth.
There's a certain feistiness that I see coming back at you, which is not helping us get to the root of this problem.
We have talked to our representative on your board, Bill Hankowsky, more than once, haven't we Bill?
And so our thoughts have not been in a bushel under a building. We have been saying, wherever we could, 64 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 as clearly as we could, that we wanted in on this process. Did you know that?
That we, who represent some minority contractors, wanted to be in on the process.
I was not aware that you represented minority contractors, per se.
Well, you know that I represent the entire City, so that must mean that some of those contractors must be minority. Now, if you want to play this game, I don't have anything but time. 65 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734
I'm going to send out for something cold to drink and we'll be here till tomorrow.
Councilwoman, if I can ask, I'm running the risk of the longest yield on record.
I'm running the risk of having the longest yield on record. What I'd like to do now is finish up with Councilwoman Tasco and then give you a regular turn in the rotation.
We -- excuse me. We have worked out the answers to some of the questions that you all asked in the last hearing. I was -- I was not here at that hearing, but I'm fully informed about the situation and the questions that was going on. We have prepared some answers to those 66 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 questions. And maybe we could clarify a little bit by going through those questions first to get a status of where we are.
We appreciate that because we do want to come to some resolution, but you can see the frustration of this committee and of Council over what has happened in the past and the reason why we've called these hearings. I just wanted to ask Mr. Benko, do you remember receiving a call from my office, from Brenda Frazier?
It's my recollection that it was prior to the first hearing.
We called your office to talk to you about those hearings, and 67 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 you weren't available and you never called us back.
Is it the same -- do you have the same receptionist that Kvaerner has, that Miss Briggs couldn't get through to?
It seems you all need to train your staff to give you telephone messages. One of the questions that I want to ask before we go to Mr. Rafdal is, are you -- is Keating only going to be concerned with -- no, let me ask it this way. What aspects of the contract will Keating oversee? Is it construction? And will they also have some monitoring responsibility for professional services? Just how broad is their contract, and who will monitor the contracts for professional services on the project?
Could you just clarify for 68 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 me what you mean by "professional services monitoring."
If you need a PR firm, if you need a secretarial firm, or other operational aspects of the company that's not necessarily going to go into bricks and mortar.
No. Keating is only involved on the bricks and mortar side, which also includes the equipment that is being purchased for the yard itself.
Now, are you going to monitor Kvaerner on the professional services side? Who's going to do that?
Do you see that as a responsibility of the PSDC board?
Let me say this. If Kvaerner's going to use any of the funding that came through the funding package that was assembled by the governmental parties, then PSDC will have to monitor any contractor, would have to approve any disbursement of funds. So to that degree, yes. 69 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734
Do they submit to you what they plan to buy before they buy it? And "buy" is broad in terms of buying professional service or any service that is paid for by the public funds that have been committed to this project.
To the extent that on the preliminary -- you have to understand that the construction includes a component that is called "preliminary development." Preliminary development is basically all of the work that leads up to the construction itself. It includes anything from renting of office space and equipment to hiring personnel. All of that -- funding for all of that must from PSDC. Now, on the preliminary development side, we work primarily on the basis of purchase orders and invoices. The master agreement basically does not permit PSDC to second-guess Kvaerner in terms of their business decisions. If Kvaerner submits to us a purchase order, an invoice for professional services, and everything is in accordance with the standard provisions, then we will pay it on the 70 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 construction side. It's a different matter on the construction side. On the construction side, Kvaerner must give us signed contracts before PSDC will release funds. In many instances, we need to see backup on components of those contracts before we will releases funding. So they are really two different animals here.
So there will be no monitoring of the professional service side by PSDC to see if there's adequate minority participation for those services. They can just spend the money with whomever, without considering any local vendor, minority or women vendors, for whatever services they might want to purchase with the public dollars.
Well, you know, if you're talking to what I would interpret as the preliminary development side, the master agreement provides that Kvaerner will make those decisions. 71 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 If that's we're talking about --
You don't see that the minority participation is a part of that?
Oh, yeah, I think so. But I believe that Kvaerner now is aware of the importance of minority participation in the project.
How do you know that they're meeting the goals of the master agreement?
Well, the master agreement, let's be very clear about it. The master agreement, you know, in terms of those specific goals that you're referring to, those goals are in relation to the construction side of the project itself.
I'm not sure that that was the intent of this Council.
But there are other guidelines, federal and state and local guidelines, that govern participation based on the fact that they are public dollars.
And Kvaerner is an equal 72 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 opportunity employer so, you know, it is --
Who's going to monitor that they are, that they live up to that title?
I think that when you have an opportunity to listen to Harold Rafdal concerning the employment goals that are being achieved within Kvaerner itself, you'll understand that they are not only meeting them but, in many instances, they are exceeding them.
But you don't see your role as monitoring them, PSDC? See, we were told that you all were going to take care of all of this stuff.
And we are taking care of it, Councilwoman Tasco. And I tried to explain to you that this is an exceedingly complex project when it comes to the funding side and how the master agreement treats each of the funding components. And there are specific provisions regarding the construction side that are not the same as on the workforce development side or the preliminary development side. 73 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 So, you know, I think part of the problem in communicating back and forth here is that for me to answer many of your questions, you need to be much more specific. And, again, I would offer, you know, to sit down with you at any time, at anyplace and discuss any aspect of the master agreement with you and discuss with you the role of PSDC as it pertains to that specific component.
I think we have been very specific in the fact that we want the spirit of this Council to be reflected in the operation of the Kvaerner Shipyard development, and that it doesn't take a rocket scientist to know that when you let contracts, whether they are for construction or whether they are for professional services or for employment, that that should reflect the diversity of the City and the public dollars that you are spending. It doesn't take a whole lot of specifics for that.
Quick comment to Mr. Benko, and then I think a couple members have questions. Again, my recollection is that you were 74 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 not here at the Council hearing that finalized this particular deal. You had mentioned on a couple of occasions that certain things are very complex and are handled differently, depending on whether it's on the construction side or the employment side or possibly even the shipbuilding side. You may have missed the great controversy around the release, or lack of release, for Councilmembers' review of this particular contract that you're talking about. There was a great amount of discussion about whether that contract was going to be made available prior to the deal. The basic answer was no. And, quite frankly, had we been able to look at some of those things at the time, many of us around here would have pointed out many of the same things that we're now having a decision about. You weren't here at that time because I don't think PSDC had been created here. If it was, I still don't recall you being in the house. But that is one of the reasons why we take a look at things before they get finished. 75 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 Councilwoman Clark. Councilman Ortiz, then Councilwoman Clark, then Councilwoman Miller.
Who's the main contractor in building the naval shipyard?
I mean, who is building the yard? What construction company is building the Kvaerner Shipyard?
Is there a project manager? 76 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734
And Keating is the project manager consultant for the PSDC.
So Keating is not advising you about the building of the shipyard. I think that's their expertise, isn't it? I didn't know that Keating was a management firm. I thought they were a construction firm.
So they're advising 77 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 you about the construction of the shipyard.
They are advising us about the construction, the various components of the construction, the various bid packages that go into construction.
They're sort of duplicating the job that the project manager is doing for Kvaerner.
Well, they have an oversight responsibility. They're verifying that Kvaerner provides us with the most advanced shipyard in the world. That's their role.
I -- I -- I think we'd rather hear from Mr. Rafdal from now on and see where we're going to go from there because you don't have many of the answers.
Yeah. First of all, I am prepared to answer any questions that City Council has. Nevertheless, we have prepared a list of answers to the specific questions you asked last time.
I'm glad somebody 78 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 at least read the notes of testimony. Thank you.
I would like to go through them first and then try to explain as much as possible, and then we can questions after that, if it's okay for you.
Do you possibly have any material that you may be able to share with us prior to your going into that? You, obviously, have a binder or something there. Is there any material that you can get to the members or that we can get copied while you're going through your. . .
I do think that we have done some minor changes on the setup of the whole contract flow, including the Hispanic Chamber of Commerce, as we discussed last time.
Right. Why don't we do it this way. If you can, just for this record, if you can tell us what the question is that you think that you are answering from last time, and then give us the answer --
-- since we don't have the materials right in front of us. 79 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734
Thank you. The first question: Is there a chart that details the bid process at Kvaerner? Answer: Yes, there is a chart, and we have it here to present to the Council.. And as I said, please note that the Hispanic Chamber of Commerce has been added to the chart to receive information from Kvaerner. The second question: Has Kvaerner added the Hispanic Chamber of Commerce to the flow chart? Answer: Yes, we have. We have a copy of the amended flow chart to present to the Council, and we can hand over that after we. . .
And the third question: Please define "fast-track." (Unintelligible) saying that no one wants to slow-track, everyone wants to fast-track. But our definition of a "fast track," is that when we state that Kvaerner is on a fast track, we mean that we have a certain and limited 80 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 time frame in which to achieve certain goals, 'cause the overall goals here is to bring people back to work and to start up the operation of the shipyard by end next summer. The question 4: What is the current breakdown of minority participation at Kvaerner Philadelphia? And do you have it on paper? The answer: We just received on Friday the report and we have brought to the members of the panel a statistic breakdown of that information for those of you who that wish to review it. I can say at the top of my head that roughly, compared to the goals of 30 percent minorities on the employees side, the figures show us today that accumulated we have achieved 45 percent minorities of the employees working at the site.
Yes, we are talking about the construction. And there has accumulated -- there have been 20,000 man hours worked since we started out throughout the summer, and 45 percent 81 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 of that work is done by minorities. The goals was 30.
Okay. And I need to stress to the members of the audience that it is very difficult for to us conduct a hearing with the comments going on back and forth. There will be a full opportunity for discussion if someone else has an interest in testifying. Mr. Rafdal, you talked about the employment side; what about the construction side?
And we have coordinated with the Private Industry Council, the so-called PIC, to provide us with potential candidates for training once the operation phase of our program takes place. Additionally, a representative on behalf of Kvaerner has had initial discussions with the director of the Philadelphia Housing Authority and some of its tenants' organizations to explore the possibility of training 82 COMMERCE & ECONOMIC DEVELOPMENT - RES. 980734 Philadelphia residents who are a part of the welfare-to-work program. In an effort to not to mislead the Council, I do want to add that this will be more than likely be coordinated throughout the Philadelphia Industrial Council.
Could we request that your comments be provided to us in writing? I do appreciate that you are struggling with it and so are we, but we need to be able to analyze the data that you're offering us.
Yes, yes, definitely, you will receive the answers, yes, in written, yes.
You will receive written copy of all of my answers because this is just my hand notes.