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Both sides are clients, yet no conflict?

A company that works for Hillsborough County schools has helped arrange land sales from other clients. And sometimes does even more.

By MICHAEL VAN SICKLER and MELANIE AVE
Published March 13, 2006


SPECIAL INVESTIGATION
Schools pays big to buy new sites
By Melanie Ave and Jeff Testerman
To get the land it needs to build new schools, Hillsborough has been willing to pay a premium to brokers that other districts don't.
Go to article (March 12, 2006)
Should you build schools near sex offenders?
By Jeff Testerman and Melanie Ave
Two sites that a broker arranged for school officials to buy sit right in the middle of dozens of sexual offenders. And they may not have to move.
Go to article (March 12, 2006)

TAMPA - The planners at WilsonMiller assured their client - the Hillsborough County School District - that they had found a terrific site for a new middle school: 38 acres of citrus grove in Thonotosassa.

WilsonMiller assured another client - the owner of the citrus grove - that the school district would be a terrific buyer. The school district would ultimately pay grove owner Derrill McAteer three times more for the property than the initial appraisal.

The deal got even better for McAteer. The site was so remote the school district needed to spend $1-million above the sale price to install water and sewer lines. As part of the deal, McAteer was allowed to tie a future 250-home subdivision into the lines free of charge.

And the firm that won the $360,000 job from the school district to design the utilities project? None other than WilsonMiller.

The deal, completed in 2003, illustrates what can happen when a public body entrusts its planning to a private company that also represents developers. It also suggests why no other large Florida school district does business this way.

A St. Petersburg Times investigation shows WilsonMiller's involvement with school officials includes other benefits:

--Its planning contract with the school district has no dollar limit, no end date and doesn't outline specific projects. The school district has paid WilsonMiller at least $2.2-million since 1998 without advertising any of the work. This conflicts with a School Board policy requiring the advertisement of any professional service worth more than $25,000.

--In at least five instances, the school district hired WilsonMiller for engineering and design jobs at school sites the company was paid to evaluate. District officials denied any favoritism, saying they chose WilsonMiller over competitors because the firm already was familiar with the land.

--In a deal similar to the one involving McAteer, WilsonMiller worked for both the school district and a private client trying to sell the district land. Like McAteer, the client was paid hundreds of thousands of dollars more than appraisals said the land was worth.

Georgianne Ratliff, a senior vice president with the company, says WilsonMiller has evaluated more than 40 potential school sites in Hillsborough and only twice has worked for both the seller and the school district.

"I understand you might see a potential conflict here," Ratliff said. "And I guess I don't. At all."

School superintendent MaryEllen Elia supports the arrangement with WilsonMiller.

She said taxpayers are being protected since WilsonMiller plays no role in appraisals or negotiations.

"WilsonMiller wasn't the one making recommendations on how much to pay the developer," Elia said.

"Can you tell me any firm in this county that I could hire that doesn't work for anybody else?" she asked. "I think that's the business environment in this community."

* * *

WilsonMiller was founded 50 years ago as a land surveying company. It now has nine Florida offices and a client roster that includes such major developers as the St. Joe Company and Newland Communities, which built one of Hillsborough's largest subdivisions, FishHawk Ranch in Lithia.

The school district hired WilsonMiller as its planner in 1998. The contact was Ratliff, who worked as a consultant for the district before her small planning firm, Ratliff & Associates, merged with WilsonMiller.

In the years since, Ratliff has billed the school district $165 an hour for advice on everything from impact fees to growth planning.

She gets plenty of opportunities. Managing growth has become a huge issue for the nation's ninth-largest school district, which absorbs an average of 5,400 new students every year.

Since 1998, Hillsborough taxpayers have spent $1.5-billion to build 60 new schools and expand or renovate 189 others. Over the next five years, school construction and renovation is expected to cost an additional $1.4-billion.

WilsonMiller provides its planning services through a "continuing contract" with the school district. It was never advertised and never came before the School Board for a vote.

School Board attorney Tom Gonzalez, in an interview with th e Times, said the district paid the company for work that was not part of the contract and should have been open to bids.

In addition to its planning responsibilities, WilsonMiller also does engineering jobs for the district. Records show the company's fees are often higher than those charged by other local firms.

WilsonMiller, for example, charged $113,000 for engineering services at Frost Elementary and Giunta Middle School in Riverview. That compares to $65,640 paid to Mills and Associates for the same work at Bryant Elementary and Farnell Middle, two northwest Hillsborough schools similar in size.

Ratliff notes that such situations are unusual. Of the 224 major construction projects in the district since 1998, records show WilsonMiller was named the civil engineer on only five.

Most of the time, the district hires architects, who assemble their own team of engineers. But in the case of Spoto High School in Brandon, records show that Elia, then the school facilities chief, instructed the architect to hire WilsonMiller as the project's civil engineer.

Until then, architect Cheikh Sylla was leaning toward hiring another company.

Elia said she "encouraged" Sylla to hire WilsonMiller because it had knowledge of the property. The district had hired it to evaluate the land for Spoto.

"If I went from zero on another firm, it would have taken longer," Elia said.

In the end, WilsonMiller was paid $164,000 for engineering work at Spoto. Engineering fees for a different firm at a comparable school, Lennard High School, were $93,000 - 43 percent lower.

Elia said civil engineering fees can't be compared from site to site because every property is different.

Ratliff defends WilsonMiller's prices and says they compare favorably to other large firms, which have higher overheads than smaller companies.

"Generally speaking, WilsonMiller is not the cheapest firm, no question about it," she said. "We don't profess to be or aspire to be. We offer really good services by qualified people."

* * *

In the late 1990s, Ratliff was the project coordinator for the subdivision Derrill McAteer planned on his Thonotosassa citrus grove. Her job was to shepherd the project through the approval process.

At the time, Ratliff also worked for the school district as a consultant evaluating potential school sites. Her responsibilities included determining if property was the right size, had sufficient dry ground and was accessible by roads and utilities.

The two jobs intersected when Ratliff introduced McAteer to district administrators she knew were looking to build a new school in the area.

"Beyond that, I had absolutely no involvement," said Ratliff, who says her matchmaking efforts helped the district in its struggle to find property in the area.

School officials told WilsonMiller to evaluate McAteer's 38 acres along Williams Road. They also hired real estate broker Lee Pallardy to appraise the property.

His first appraisal valued the land at $240,000. His second, issued two months later, was $315,000. But the newer appraisal assumed the land was hooked up to modern sewer and water systems, which it wasn't.

District officials decided to get a third estimate.

Michael Bookman, then an assistant superintendent, hired William Copeland to do the appraisal. Now retired, Bookman said he doesn't recall specifics, but said he chose appraisers from a rotation of about 20. Copeland was on that list.

In his day, Copeland had a reputation as one of Tampa's best appraisers. But when the district hired him to review McAteer's land, he was 87 and had been retired for eight years.

Copeland, now 92, said he doesn't recall how he concluded the McAteer land was worth $700,000 - nearly triple the first estimate.

When the School Board voted to buy the land, members agreed to pay what Copeland said it was worth - $700,000. It later added an additional acre for $17,400. The man who recommended the price was Jack Davis, then the school facilities chief. District records show board members didn't discuss the cost before approving it.

Six years later, Davis said it's hard to remember the basis for his recommendation. While the district typically buys at or below the average appraised value - $418,333 in this case - he said he didn't follow a strict procedure.

"We're putting so much weight on the appraisal process, I don't know if that's fair," said Davis, now the district's technology officer. "You still have to negotiate. It usually boils down to the art of the deal."

In Florida, some large school districts regularly pay above appraised value while others do not.

District officials in Orange, Palm Beach and Pasco counties say they sometimes have to pay above estimates because of a hot real estate market. Miami-Dade, Duval, Broward and Pinellas counties typically do not.

"The market is established by the appraisals," said Jim Miller, the director of real property for Pinellas schools. "We buy within the range. If we can't buy within the range, we back away from it. Taxpayers get a fair deal that way."

* * *

For McAteer, WilsonMiller's client, the deal would get even sweeter.

To get final permission from the county for 250 homes, McAteer's land had to hook up to a water and sewer system. The closest system was about two miles away.

So McAteer told the school district the deal for his property hinged on whether the district extended its pipes to his land.

The School Board approved extending two miles of water and sewer lines to Jennings, the new school. As part of the agreement, the pipes were made big enough to accommodate McAteer's subdivision, a condition that also met a county requirement that the pipes be large enough to handle all future land uses, which included the subdivision.

The cost to taxpayers: about $1-million. That was in addition to the $700,000 spent on the land.

McAteer paid nothing.

"That was part of the deal," he said.

Jennings Middle School opened in 2003. The next year, McAteer sold the land north of the school to a Melbourne development company for $5.45-million. County commissioners approved the subdivision's final construction plans last fall.

The school district has extended water and sewer to new schools at least three other times, though perhaps not as far as two miles, said Harry Niles, a senior engineer at the county's water department. He said the Jennings deal was unique because the land owner was waiting for the water connections.

"The one you're talking about involves a developer selling the school land," Niles said. "They were cutting that deal before they came to us."

In retrospect, Davis said he might have done things differently.

"If we had known it would cost us $1-million," Davis said, "I don't know if we would have gone ahead and done it."

WilsonMiller also fared well in the Jennings deal, getting paid $361,000 for designing and overseeing the utilities project - part of the $1-million the district spent on the water and sewer lines.

Ratliff says the district needed the school quickly and her company pulled off a difficult water and sewer connection.

"I honestly don't think anyone else could have done it," she said. "It was a very complicated situation."

* * *

The McAteer deal wasn't the only school project that involved a WilsonMiller client. A family-owned company called Artesian Farms Inc. applied in 2002 for zoning approval for 1,936 homes on the site of tomato fields in Ruskin. WilsonMiller was the project coordinator for Artesian.

The district was interested in purchasing 65 acres for what would become Lennard High School, which opens next year, and an elementary school. Again, the deal was sparked after Ratliff introduced her two clients.

District officials bought the land for $2,555,000 from Artesian Farms - $405,000 more than the highest of at least three appraisals paid for by the district. One valued the land at $1,495,000 - more than $1-million less than what the district paid.

"The prices are whatever the market will bear," Davis said. School district spokesman Stephen Hegarty noted that the site included roads, infrastructure and zoning rights that saved the district time and expenses.

Ratliff stressed that her relationship with the developers had nothing to do with the price the district paid for the Jennings and Lennard sites.

Regardless, WilsonMiller's ties to the district are strong.

One of WilsonMiller's former planners, John Bowers, is now the district's planning manager. And Chandler Bricklemyer, the son of School Board chairwoman Carolyn Bricklemyer, had two summer internships at the company, doing work for the school district that was billed at $55 an hour.

Before Jennings Middle School was built, Pauline Grant feared McAteer's 250-home subdivision would erase the community's rustic feel. In her role as project coordinator, Ratliff told residents and county officials that the subdivision's plan to include a middle school would be a community asset.

But Grant, president of the Thonotosassa, Seffner, Mango Civic Association, said she didn't learn until much later that WilsonMiller, Ratliff's firm, evaluated the school site for the district and deemed it suitable. Ratliff, Grant said, should have disclosed that earlier.

"I feel we were deceived," Grant said. "It seemed like she was keeping it hidden. The way I see it, you can't avoid a conflict when you represent a builder and you're also working for the school district."

--Michael Van Sickler can be reached at mvansickler@sptimes.com or 813 226-3402.

[Last modified March 13, 2006, 00:59:12]


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