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Company that lost bid for Marshall Fire debris removal program files lawsuit against Boulder County

Lawsuit claims DRC Emergency Services misrepresented prior work, met with county to adjust cleanup timeline
Marshall Fire victims concerned green building code could prevent rebuilds
Posted at 3:54 PM, Apr 07, 2022
and last updated 2022-04-11 17:48:54-04

BOULDER COUNTY, Colo. — One of the companies that lost the bid for the debris removal contract in the wake of the Marshall Fire filed a lawsuit this week that asks a Boulder County judge to invalidate the contract the county agreed to with the winning company, but the county says it will move forward without changes to the current timeline unless a judge orders otherwise.

The company, Florida-based Ceres Environmental Services, Inc., filed the lawsuit on Tuesday. The county said it learned about the suit on Wednesday.

The Marshall Fire broke out on Dec. 30, 2021 and, pushed by hurricane-force winds, destroyed more than 1,000 homes in unincorporated Boulder County, Superior and Louisville.

On March 22, Boulder County approved and signed a contract with Louisiana-based DRC Emergency Services, LLC for the county's Private Property Debris Removal (PPDR) program, which has invited residents impacted by the 6,026-acre Marshall Fire to opt-in to have their land cleared. On April 1, a list detailing the order of street cleanups was released online. In late March, county commissioners voted unanimously to approve the estimated $60.1 million contract with DRC, whose bid for the debris removal was awarded Feb. 10 by an evaluation team made of Boulder County, Louisville and Superior staff.

The group recommended DRC as the best value of the 11 bids it received, which are all published on the county's website. Ceres was ranked third and was not chosen for interviews with the committee.

In the lawsuit, Ceres calls DRC “an unqualified contractor who has neither the experience, timeline, nor pricing to justify the award.” The company claims Boulder County “secretly” negotiated with DRC to have the company adjust its timeline and pricing, and that DRC misrepresented its work experience on prior post-wildfire cleanups.

Ceres claims these allegations – which Boulder County has vehemently denied – jeopardize the reimbursement of the costs by the Federal Emergency Management Agency (FEMA) and do harm to both the company and Colorado taxpayers.

The lawsuit claims that four days after responses to the request for proposal (RFP) were submitted, on Feb. 7, Boulder County conducted “secret interviews and negotiations” with DRC and ECC Constructors, LLC, a company based in Lakewood.

And the lawsuit claims that DRC “orally adjusted” its timeline for completion of the cleanup from 7 ½ months down to four months, to an estimated July 1 completion date, thus improving its scoring in the bidding process.

In its award letter, Boulder County said it met with the two finalists on Feb. 7 for final interviews, which were followed by a 1 ½-hour evaluation meeting. The next day, the committee met for another seven hours of discussions before unanimously deciding to award the contract to DRC, according to the county.

Prior to the Feb. 7 meeting, the committee met for a combined 3 ½ hours on Feb. 2 and 3, and again on Feb. 4 for 4 ½ hours to evaluate the proposals. The county said it identified the two finalists during that Feb. 4 meeting.

In Ceres’ lawsuit, the company claims “secret interviews and negotiations were conducted” with DRC and ECC on Feb. 7, when the county said it had already chosen the finalists three days beforehand.

DRC’s original Feb. 1 response to the RFP for the cleanup contract indeed does not say anything about completing the cleanup by July. It put the project duration from the RFP response of Feb. 1 to Dec. 13, including days for weather delays.

According to the RFP response, the company said it could complete work in unincorporated Boulder County by Sept. 30, in Superior by Oct. 14, and in Louisville by Oct. 24.

“Debris removal will be complete on Oct. 24. This schedule includes possible weather delays and parcel acceptance allowances which may extend the completion date to Dec. 10, 2022,” the response says. It goes on to say the removal of temporary facilities involved in the cleanup and demobilization would occur Dec. 12-13.

But the county’s RFP final scores document says DRC said it could complete the cleanup, including foundations, in four months, while Ceres said it could finish in five months. Two other companies – Looks Great Services and ECC Constructors – both also said they could complete the cleanup in four months, according to the document, and received the same score for that section as DRC.

“Project schedule will be assigned a preliminary score proportional to the shortest schedule in which shortest duration will receive maximum points and longest duration receives minimum points,” the document says on how those timelines would be scored. “...Review committee removed weather delays from the project schedule to normalize the schedules across the board.”

According to Ceres' website, it worked in Butte County, California in the wake of the Camp Fire in 2018 and in multiple counties in northern California for 2017 wildfires. Per the public document with scoring for each bid, Ceres has been involved with 4.5 wildfire debris removal projects. The document says DRC has been involved in six, including, according to its website, the 2020 Babb Road Fire in Washington.

The lawsuit claims that DRC misrepresented its involvement in certain cleanup efforts, including on the November 2018 Camp Fire in northern California and Woolsey Fire in southern California. Ceres claims DRC “falsely claimed experience from projects that Ceres and ECC successfully managed on significant fire cleanup contracts on the west coast.”

Among those claims are that DRC bought Forgen after most of the work on the Woolsey Fire was complete, that a DRC contractor did only 2% of the work on the Camp Fire cleanup, and that the company was hardly involved in a cleanup after a fire in Washington.

But in DRC’s response to the RFP, the company did not directly say that it was involved in those efforts. On both the Woolsey and Camp fire sections on its response, DRC said “DRC’s family of companies” was involved in those efforts. The response also directly says that Forgen was involved, which is a subsidiary now wholly owned by DRC, according to the company.

Nonetheless, Ceres claims in its lawsuit that DRC’s proposal would have been denied by the committee “if DRC had been evaluated based on its true experience, as there was no material change in DRC’s experience between the Camp Fire Project and the Marshall Fire.”

Ceres claims that the alleged issues it identifies in the lawsuit boosted DRC’s score by 24 points and that its score would be higher than DRC’s if that had not been the case.

The county said out of a score of 100, DRC finished at 91, ECC Constructors ended with 84, and Ceres finished with the third-highest score of 68. Click here to see a breakdown of the scoring, which takes into account project cost, timeline and past experience with similar projects.

The Boulder County contract signing has already been held up by two appeals, including one from Ceres. Both were dismissed, as was a lawsuit that challenged the manner in which the bid was awarded to DRC.

The county said it was first alerted to Ceres' lawsuit on Wednesday, after Ceres had appealed the procurement process and the county had responded with a written explanation for the company's concerns, denying the appeal. The matter was also discussed at a Boulder County Commissioners' public meeting, which can be viewed here.

In the lawsuit, Ceres is asking a judge to issue a declaratory judgment that the contract between DRC and Boulder County is invalid. The company is also asking for a full judicial review of the award, to find Boulder County violated its policies in awarding the contract, and for the judge to resolve Ceres’ claims and grant the company attorney’s fees and costs.

County Attorney Ben Pearlman said the lawsuit is "without merit."

"It’s heartbreaking that a large disaster management firm with no ties to Colorado is attempting to hold up our ability to make progress in Marshall Fire recovery efforts," he continued. "We’ve learned throughout this process that in the highly competitive environment of private disaster management firms, like Ceres, are focused more on money than on the families affected by disasters."

On April 11, Ceres said it would drop its lawsuit if all the proposals are retallied "in a fair and transparent review."

“This case is about doing the right thing to protect Boulder County and Colorado taxpayers,” said Katie Reilly, the attorney representing Ceres. “Ceres is fully prepared to accept the results of a proper, open scoring process that follows Boulder County’s procurement regulations. This, however, was a deeply flawed process that violated both county and federal rules requiring an open, competitive bidding process.”

Boulder County officials said the county will "do everything in its power to stop Ceres from disrupting cleanup of the approximately 750 households that have chosen to participate in the PPDR program."

Denver7 has reached out to DRC Emergency Services for comment on the lawsuit and its claims, but the company did not immediately respond on Thursday afternoon.

Editor's note on April 11 at 3:45 p.m.: This story has been updated with a statement from Ceres, claiming it will drop its lawsuit if the the Boulder County Commission rescores Marshall Fire cleanup bids.