AUDIT FAULTS CITY FOR COST OVERRUNS CHICK: LACK OF OVERSIGHT BLAMED FOR SOARING PRICE OF POLICE HEADQUARTERS.

Byline: Beth Barrett and Rick Orlov

Staff Writers

Costs of a new downtown Los Angeles police headquarters have soared $150 million over projections -- to more than $453 million -- because the city's Bureau of Engineering has failed to provide adequate oversight and management, City Controller Laura Chick said Thursday.

The 10-story building at First and Spring streets is scheduled to open next year as a replacement for the aging Parker Center.

But after releasing an audit performed by KPMG for $187,000, Chick said city engineers lost control of the project and the LAPD had to step in to deal with the design firm.

"What went wrong was too many hands and departments in this and not enough management from the Bureau of Engineering," she said.

Cora Jackson Fawcett, a spokeswoman for the Board of Public Works that oversees the bureau, said the department is reviewing Chick's report and implementing her 32 recommendations.

She said the bureau could not comment on any specific aspects of the report or Chick's comments.

Chick credited the bureau with being responsive to the recommendations, which generally involve more oversight of projects, negotiations and procedures once construction begins.

In her first audit of a major construction project, Chick also said the city needs to do a better job reaching out to contractors in its negotiation process and planning construction.

"What we did here was hire the architect first to do the design and then hire the project managers," Chick said. "They should all be hired at the same time to make sure we have a project that makes sense."

Chick also said that because the city used municipal lease-revenue bonds, it avoided the scrutiny or political backlash that would have ensued if general fund money had been used as costs escalated.

At the same time, Chick said she did not find major wrongdoings at the project -- originally estimated at $303 million -- or in the work performed by the principal contractor, Tutor-Saliba Construction Corp.

"We did not find them responsible for most of the change orders," Chick said. "Those came from the city."

Chick said part of what she found was inadequate planning up front -- such as a decision to reverse the original location from Little Tokyo to directly across from City Hall.

As a result, the decision to move elsewhere resulted in delays that drove up costs and complicated negotiations to acquire land.

She said the city also did not adequately plan what would be needed in the building -- including space for computer servers.

Nick Patsaouras, who requested the audit as chair of an oversight committee on the project, said he was pleased with Chick's recommendations and said they confirmed the city has not been operating with "the best management practices."

"There was not adequate oversight and a lack of controls on this project that we have tried to bring under control. We have already begun implementing many of her recommendations and my hope is it will be used citywide, particularly at the Los Angeles World Airports," he said.

LAPD Chief William Bratton said he could not comment directly on Chick's audit because he had not seen or been briefed on it.

But he said part of the cost increase is linked to fights over where the headquarters would be located.

Plus, the new location on First Street was not large enough to house the LAPD's headquarters, garage and maintenance facility, which required additional buildings at additional cost.

"It's a building that is desperately needed. I'm always worried sitting in Parker Center that it's going to fall down while I'm sitting in it," he said.

"And anytime I'm standing here (in the Metropolitan Dispatch Center next door) I'm worried it's going to fall over on top of me."

Chick said more of the city's $3 billion in construction projects need to be audited.

"I would like to see us, in the future, have a percentage set aside for construction audits so we can go in and see how the work is being performed," she said.

Chick said she is planning to audit the Emergency Communications Center being built with an estimated budget of $50 million.

She also is planning another review of construction of new Animal Service shelters, which have drawn complaints.

Staff Writer Kerry Cavanaugh contributed to this report.

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