Tennessee comptroller says State Building Commission still in charge of Jones Lang LaSalle contract

Comptroller Justin Wilson

NASHVILLE - State Comptroller Justin Wilson's office says the State Building Commission will still call the shots regarding design and construction services under the Haslam administration's massive building management outsourcing contract with Jones Lang LaSalle.

Wilson is reviewing the contract that could put as much as 87 million square feet of publicly owned higher education and state building services under JLL management.

He said in his letter responding to concerns voiced by Sen. Mike Bell, R-Riceville, that JLL is "not authorized to include design and/or construction under ANY contract with the state.

That includes work done in-house or via subcontract, the comptroller said.

In February, Bell raised similar concerns about architects, engineers and contractors on another administration outsourcing project. That involves Fall Creek Falls State Park. The administration wants to provide $22 million to the bid winner to tear down and build a new park inn.

Because the contract specifically did deal with design services and only come before the State Building Commission near the end of the process, objections by Bell and others resulted in Wilson and other members of the State Building Commission to impose their authority.

The end result was design and engineering services at Fall Creek Falls would remain under the SBC's purview at various stages. And that, in turn, forced the Tennessesse Department of Environment and Conservation to revise the scope of the contract in the midst of the process, delaying final action.

Bell told the Times Free Press earlier Thursday that he had been told architects, engineers and construction firms would not be impacted in Haslam's latest round of outsourcing.

But Bell, chairman of the Senate Government Operations Committee, said he wanted Wilson to weigh in.

Haslam's new round of outsourcing involves the University of Tennessee, Tennessee Board of Regents systems as well as six universities recently spun off from TBR. Also impacted are facility management operations at state prisons, mental health hospitals and other state facilities.

Individual higher education campus leaders, including at the University of Tennessee at Chattanooga and Chattanooga State, will determine whether JLL will save them money. State govermental agencies, however, will have no choice.

While the contract calls for JLL or its two subcontractors to hire existing state workers and offer a comparable benefits package, both the United Campus Workers union and the Tennessee State Employees Association remain highly skeptical.

Nearly a third of the General Assembly - 42 senators and representatives - signed a letter sent last week to Haslam's outsourcing czar, Terry Cowles, calling on a halt to the plan to give them more time to study it.

Only one Hamilton County lawmaker, Rep. JoAnne Favors, D-Chattanooga, signed it. Meanwhile, 17 lawmakers have requested economic impact statements for their districts. The administration says it's working on it.

The administration says is up to 3,000 state workers in facilities management, energy management, janitorial and grounds keeping services would be involved in the JLL bid.

JLL won the contract to manage facilities services across most many large state buildings across Tennessee in 2013, through a series of SBC-approved contract expansions that began with a consulting contract.

The administration says the company has saved taxpayers millions of dollars, but critics ask at what cost. In the original contract, JLL did not hire dozens of workers.

Speaking with reporters on Thursday, Chief Procurement Officer Mike Perry said the administration learned lessons from that and imposed new rules in the new contract, awarded to JLL over two other firms last Friday.

The negotiating process is a twist on standard bidding and is known as vested contracting In it, the state and interested companies engage in a lengthy back and forth process before a finalist is selected following a lengthy process known as vested contracting.

It's the brainchild of the state's highly paid consultant Mike Ledyard, who has taught at UT-Knoxville and is now using Tennessee as Exhibit 1 to to push the idea nationwide.

Perry and others say it's already saved Tennessee millions of dollars.