After Review, Decision Final - DHS to Build in TimberMill Shores

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Conceptual Rendering overhead map view, Oregon Department of Human Services MultiService Center in Klamath Falls, Ore. (Submitted Photo)

Conceptual Rendering overhead map view, Oregon Department of Human Services MultiService Center in Klamath Falls, Ore. (Submitted Photo)

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Klamath Falls News has obtained a copy of a letter from Department of Administrative Services Director, Katy Coba and Department of Human Services Director, Fariborz Pakseresht addressed to Paul Stewart, CEO and President of Sky Lakes Medical Center.

Inside this letter (copied & linked below), Coba & Pakseresht respond to issues raised and suggested solutions by Stewart in his letter to the Governor dated March 21, 2018.

Coba & Pakseresht respond by addressing the process - RFP Distribution, Real Estate Siting, and Site Selection. 

Coba & Pakseresht ultimately state that, "We also asked our teams to do a comprehensive review of the process to ensure it was legal and sound, and that the best proposal was chosen for DHS and the state. Based on this review, we did not fine any basis for overturning the award and, therefore, we are moving forward with the signing of the lease with Rubicon Investments."

It appears as the local DHS Office will be located inside TimberMill Shores, adjacent to the Klamath County Courthouse, Klamath County Library, AmeriTitle and any future developments in the area.

March 27, 2018

Paul Stewart, President & CEO
Sky Lakes Medical Center
2865 Dagget Ave
Klamath Falls, OR 97601

Dear Mr. Stewart:

We are in receipt of your letter dated March 21, as well as the letter you provided to Governor Brown during her recent visit to Klamath Falls (“Three Potential Options to Resolve Current Dispute”), which she has asked us to review. We have reviewed both letter, and we respectfully disagree with a number of your assertions about the process, the executive orders and the proposed sites.

As you know, DAS and DHS met with Klamath Works representatives in 2016 prior to issuing the RFI in May 2017. The distribution list for the RFI included hundreds of recipients, including city officials, county officials, legislators, members of congress, the school district, the community college, the transit district, tribes, and all brokers and developers who have asked to be notified about DAS real estate siting opportunities.

The RFI process included public notice and the opportunity for feedback. However, we recognize that additional public dialogue may have helped provide clarity regarding DHS requirements for their new facility and the different clientele who will be served at this facility versus the Klamath Works campus.

It may have also provided clarity on how the state leasing process works, particularly the fact that, for this type of real estate citing process, public comments or concerns are considered; however, the location that is overall most suitable, cost effective and safe for our staff and clients is selected. In this case, TimberMill Shores.

Real Estate Siting
From a legal standpoint, the DAS Real Estate Siting process differs from the standard procurement process for other goods and services, although we do use the terms RFI and RFP in both. The paramount difference is that the state leasing is not bound to public procurement codes. Rather, it is part of a negotiation process where the final choice made is not based on scores. Per ORS 276.429, DAS “shall consider cost and long-term best interests of the state” in this type of decision, and it is the policy of the state, in fulfilling the objectives set forth in ORS 276.426, to acquire office quarters in the most cost-effective manner feasible.

The documents obtained via public records requests were misconstrued as containing relevant information related to a “scoring process” when, in fact, they information contained in those documents was the personal opinion of local agency management staff on only one factor – each proposed location. Therefore, any challenges to a standard RFP scoring system would not apply in real estate decisions. We also sought DOJ opinion and were advised the process was legal and sound.

Site Selection
We stand by our belief that the TimberMill Shores site is a better location for the new DHS facility. It has better access, provides the best economic value for the state, and better satisfies the executive orders related to sustainability, locating in central business districts, and economic Vitality. We have offices in other downtowns and business districts in Oregon (Grants Pass, North Bend, Corvallis, Dallas, and Roseburg to name a few).

The new DHS facility will serve many parts of the Klamath Falls population, including children, families, the elderly and people with disabilities, whereas Klamath Works is focused on unemployment and poverty. We are very open to out-stationing staff at the Klamath Works campus, especially from our Self Sufficiency Programs, which are a closer match to the needs of the population already served on the campus.

Conclusion
We have reviewed the concerns and potential options you presented to the Governor and to us. We also asked our teams to do a comprehensive review of the process to ensure it was legal and sound, and that the best proposal was chosen for DHS and the state. Based on this review, we did not fine any basis for overturning the award and, therefore, we are moving forward with the signing of the lease with Rubicon Investments. We understand this is not the outcome you expected, and we have much mending to do with Klamath Works stakeholders.

We are committed to keeping the lines of communication open. Please know that we will use lessons learned from this process to improve communication in the future.

Sincerely

Katy Coba, Director
Department of Administrative Services

Fariborz Pakseresht, Director
Department of Human Services