When its new light-rail line is completed this year, Denver will join the ranks of "America's most progressive cities," promotional literature for the project says. But construction of the system, some now charge, has involved an old-fashioned conflict of interest.
The Regional Transportation District, the government agency building the light-rail system, is paying a company called Construction Management & Technical Services (CMTS) to do quality-control inspection along the 5.3-mile line, which stretches south from Five Points through downtown to the Gates Rubber plant near Interstate 25 and Broadway.
Some of the work CMTS has been checking is that of Metroscope Construction Services, a contractor headed by the CMTS president's own nephew.
"Certainly that would be a conflict of interest," says the president of one local engineering firm, who asks not to be identified. Since RTD is paying for the project with public money, the engineer says, it "ought to be held to the highest possible standard."
"It would raise the specter that some conflict of interest might or could exist," agrees William Mielke, president of Ruekert & Mielke, a Waukesha, Wisconsin, engineering firm that specializes in inspection and quality control on municipal construction projects.
Owned by the controversial and politically connected Denver businessman King Harris, CMTS is being paid $420,000 for inspection services as a subcontractor to O'Brien-Kreitzberg & Associates, which RTD hired to manage construction of the entire light-rail project.
Metroscope, controlled by Harris's nephew Michael Harris and headquartered on the same property as CMTS, holds an $875,000 contract with Kiewit Western Co. to lay concrete along the line's north link between Five Points and the Auraria campus.
RTD officials dismiss the idea that the companies have a conflict. They say the negative effect of the arrangement on the system is nil.
"We continue to have very good experience with that project," says RTD chairman Ken Hotard. "It's on time [and] it's on budget...I do not see any outward signs that there are any difficulties with our contractors.
"I guess you can focus on appearance if you want to. My focus is on performance. And I think the performance is excellent."
RTD spokesman Andrew Hudson says there is no way any shoddy work could slip through the cracks. Inspectors from Kiewit Western, O'Brien-Kreitzberg and RTD itself, in addition to those from CMTS, go over all construction work, Hudson says.
"The bottom line is, we have a series of levels of inspection to make sure this work is the best possible work," Hudson says. Besides, Hudson says, "so far all the work that [Metroscope] has done has just been fantastic."
Construction of the $117 million light-rail line is about 80 percent complete. Critics have derided it as a boondoggle "ride to nowhere," especially since plans to run the line out to the area of Stapleton International Airport were shelved in the face of Park Hill neighborhood protests, stranding it in crime-ridden Five Points.
But proponents say the line under construction is just the spine of what eventually could be a regional rapid-transit system reaching to Boulder, the Denver Tech Center and Denver International Airport. Even the short section now under construction, they say, will carry 13,000 passengers a day when it opens in October.
The relationship between CMTS and Metroscope is a little hazy. The US West white pages list Metroscope's headquarters at 1328 East 22nd Avenue in Denver. CMTS is listed at 1330 East 22nd--an alternate address on the same property.
Metroscope, furthermore, is "the same company, basically" as Jesse's Concrete Inc., according to an unidentified man who answered the phone at the company last week. Jesse's Concrete, founded in 1986 by Jesse Lee Melson of Denver, is also headquartered at 1328 East 22nd. Michael Harris is listed in state records as vice president of that company. And King Harris registered as a lobbyist for Jesse's Concrete with the City of Denver in 1992, records show.
Mielke, the consulting engineer in Wisconsin, says CMTS and Metroscope at least should have disclosed their connection to officials at RTD. Mielke is chairman of the professional selection committee for the American Consulting Engineers Council, a Washington-based trade group. The committee works with government agencies to determine the best way to hire engineers and architects on public projects.
"Whoever is the person paying the bill for that should have been made aware that this possible conflict of interest could exist," Mielke says. "To me, at a minimum, it would at least require disclosure."
It is not clear whether CMTS or Metroscope revealed their relationship when hired for the light-rail project. Officials at Kiewit Western say they knew of the connection, but RTD staff members and directors contacted by Westword claim they were unaware of the relationship.
"I wasn't aware of this," says Phil Anderson, the RTD boardmember who chairs the agency's rapid-transit oversight committee. Anderson says the fact that each company was hired by separate prime contractors makes the arrangement more "palatable."
"I don't really have a big problem with this," he says. "I don't think it's a big issue right now."
Still, he says, RTD might want to explore new regulations requiring quality-control inspectors to be completely independent from building contractors on future transit projects.
"We're under the spotlight as a government agency," Anderson says. "So maybe we need to rewrite our laws in the future to reflect that."
Michael Harris refuses to talk with Westword, saying he has previously been "slandered" by the media. King Harris also declines comment. "I don't talk to the press," he says. Jesse Melson could not be reached.
King Harris has been a controversial figure in Denver public works projects in the past. In 1987 the Denver Post reported that CMTS had been awarded a $3.5 million inspection contract at Stapleton International Airport despite the fact that it had not submitted the lowest bid on the project. The paper also reported that the city allowed Harris to transfer the contract to CMTS from another company, California Park Construction, that faced more than $125,000 in federal income tax liens. The city also waived requirements that CMTS inspectors hold engineering degrees, the Post said.
In 1989 CMTS was given a $4.5 million contract to inspect work at Denver International Airport. Records show that since then the contract amount has been increased on six occasions and now stands at $19.5 million.
King Harris enjoys close ties to Mayor Wellington Webb. He has been contributing to Webb's election campaign since 1988, records show. And he is a former business partner of city attorney and Webb appointee Dan Muse.
Muse was an officer in a company Harris founded in 1986 called Airport Concessions Inc., which was awarded a share of a concessions contract at Stapleton airport worth an estimated $20 million.
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