Another Convention Center Contract Goes Over Budget
NewsChannel 5 Investigates has discovered another contract that is well over budget and is expected to go even higher.
The discovery came less than a week after Mayor Karl Dean suspended a public relations contract because costs were six times higher than originally expected.
The latest contract was with the consulting firm C.H. Johnson. Their job was to help MDHA with the hotel portion of the proposed convention center which, it was announced this week, would be a Marriot Hotel.
The contract with C.H. Johnson Consulting was signed in June of last year. It said costs will not exceed $93,500, plus $11,000 for expenses.
Six months later, the contract was amended and left open ended to services paid on an as-needed basis.
As of last month, MDHA has paid the firm nearly $315,000 - three times the amount of the original contract.
"If you're not managing the contracts this early in the process, where are we going to be $500 million from now?" asked Metro Council member Emily Evans.
Council members raised questions about how the project was being managed after our first report revealed a public relations firm had billed the city nearly half a million dollars on a contract that was originally not to exceed $75,000.
"Let's take a time out," said Nashville Mayor Karl Dean on August 5, 2009.
Dean suspended the contract and sent a letter to MDHA saying open-ended contracts are not a good way to do business.
At MDHA's board meeting, executive director Phil Ryan said all contracts had been reviewed following our investigation.
Last week, MDHA amended the C.H. Johnson contract again. There's a cap on spending at $500,000 - nearly five times the original budget.
The council will vote next week on whether to take control of the project away from Metro's Development Agency and give it to a separate convention center authority.
The council has not given final approval to the convention center or to the proposed hotel. The council has approved money to buy the land for the project.