Los Osos sewer costs escalating

April 10, 2013

lososos sewerBy KAREN VELIE

The cost to construct a sewer system in Los Osos is slated to run over its $173 million budget because of pay raises, extended contracts and under estimated workloads.

On Feb. 24, San Luis Obispo County’s Public Works Director Paavo Ogren approved a 3 percent pay raise for employees of HDR Engineering. The amendment makes the pay increase retroactive to Jan. 1.

As a result of the amendment, Cal Poly interns working on the project are now paid $49.44 an hour, five of the 27 HDR Engineering employees are making over $200 an hour with the highest paid employee making $267.20 an hour.

“The total of all payments to engineer under the agreement shall not exceed the agreement amount $6,891,632,” the amendment says.

However, on the county’s website it explains that the original estimates of construction management and designer costs are for a time period shorter that then the actual construction schedule because of a large number of lateral change requests and utility line conflicts.

“The planned schedule in each engineering agreement is significantly shorter than the actual construction schedule in the approved contracts for the collection system,” according to a report by project manager John Waddell. “The scope of work for both the construction manager and designer is required to continue throughout the duration of the construction contracts.”

County staff has recommended agreement amendments for both the construction manager and designer to provide them the additional funding. The county is planning to process the agreement amendments within the next two to four months.

In addition, the area in need of road repair is running about 50 percent larger than anticipated and the cost of digging the water recycling ponds is estimated to run several million dollars over budget, the county’s website says.


Inline Feedbacks
View all comments

Where is the General Manager, Margaret Falkner during all of this? Doesn’t she know that a contract is a contract and the cost are typically fixed? Since, when does an agency give a contractor under contract a cost of living raise? Why isn’t Margaret Falkner objecting to this increase on behalf of the residents check books? The residents of Los Osos are going to pay for this increase and it is no small increase per household? Do the math and see how much the little increase will cost! Is she asleep under someone’s desk? Sure glad the board made her the interim idiot!

The County, not the LOCSD, is in charge of the project. This has been the case since 2007.

The General Manager acts at the direction of the LOCSD Board. She is not allowed to act independently.

Unbunch your panties and send an email to the County, or do you expect answers to come from a comment section of a news article?

Your rude suppositions explain why you hide behind a moniker.


This decision lies squarely on Paavo Ogren, his name is signed on the dotted line.

Not her money, why should she care?

Ms. Velie, apparently you’ve never spent time in the business world. What you cite as wages for interns and HDR, are actually “billing rates.” The employee makes a fraction of that amount. The rest goes to overhead, workers comp ins, retirement, etc. GET YOUR FACTS STRAIGHT.

As a taxpayer it’s the same, we are paying for it.

The rest goes to overhead, workers comp ins, retirement, AND PROFIT, Get your facts straight.

Except the story doesn’t say that. Why is that so hard to see? It says, “Cal Poly interns working on the project are now paid $49.44 an hour…” Certainly sounds like these interns are pocketing nearly $50 an hour. Perhaps the reporter didn’t realize the truth. Of course, by now there should be at least a clarification posted. But that’s not how CCN works. Corrections? Clarifications? Can’t recall seeing one. Perhaps there’s an agenda to stir up people by suggesting interns are making a boatload of cash working on a controversial project. Who knows? All I know is CCN never seems satisfied with just reporting facts.

Let’s go with this. The taxpayers are paying out $50/hour for Cal Poly interns. What salary are these interns actually making? I doubt their pay exceeds $20/hour. I doubt they are given any benefits whatsoever. So in the end, that’s close to $30/hour pure profit for the company. What a great deal for the company.

What an overall great profit-making venture: Get a big contract, ask for and receive more money after you get the project. There is absolutely no risk to the company, and certainly no incentive to deliver the project within budget. Moreover, this company can increase their profits by finding something to wave their hands at in order to justify another request for more money off the backs of Los Osos residents who are paying for the sewer.