BY JIM DOOLEY
The state public housing agency must seek competitive bids before awarding a 
$798,000 contract for installation of “instant” hot water heaters at Mayor Wright Homes, chief procurement officer Aaron Fujioka said today.
The Hawaii Public Housing Authority asked twice this week for permission to award a sole source contract to The Gas Company for the work.
Fujioka denied the requests but today said HPHA would be allowed an “abbreviated and expedited” contract award process if it seeks price quotes from competing companies.
“There are dozens of vendors already signed up in the category for water heaters on HePS (the Hawaii Electronic Procurement System),” Fujioka wrote. Allowing those companies to offer price quotes “will allow for a broad based, fair and open competition for all prospective contractors/vendors,” Fujioka told HPHA.
The contract solicitation must be open for at least three days, Fujioka said.
HPHA’s first attempt to award a non-bid contract was classified as an “emergency procurement” by HPHA but was rejected by Fujioka Wednesday.
“The emergency procurement process is not to be used to rectify a situation that was preventable and caused by bad management,” Fujioka said.
HPHA asked again yesterday to be exempted from competitive bidding and was rebuffed by Fujioka.
“There is no information on whether other prospective vendors were contacted to justify that this exemption would be the most advantageous to the State,” Fujioka wrote.
“Potential vendors should be afforded the opportunity to provide a price quotation for the required equipment and services,” said Fujioka.
That would promote “open broad-based competition, thus assuring the State a fair price,” the procurement officer said.
Some residents at Mayor Wright Homes have been without hot water for extended periods of time and have staged public protests and threatened lawsuits over the matter.
HPHA is designing a permanent overhaul of the existing solar water heating system at the 35-building public housing project in Honolulu.
For a short-term fix, HPHA wants to install as many as 57 “tankless instant hot water” systems at Mayor Wright at a cost of $14,000 per system. The total cost would be $798,000, according to HPHA.
Once the new solar system is installed, the tankless water heaters will serve as back-up equipment, according to HPHA.
lets get real….no one is questioning 14K for a tankless water heater.? I put one in my house for less than 1K.
I did the work my self so i am sure that a plumber would charge more. this deserves a little more in depth investigative reporting. we have been taken to cleaners so many times by contractors here in hawaii that we just turn a blind eye and accept the price? for sure we need to get competitive bids. Make sure we get bids from non-union licensed plumbers/contractors and make sure the bid instructions arent written so convoluted to exclude qualified contractors in favor of a few favorites. The Gas company ought to be ashamed of a bid that high. or be willing to explain the costs in detail so we understand the price. sure they need to make money….we need to know what their margins are..more than 20% profit is robbery.
Our families of companies has been State of Hawaii vendors for 18 years an we agree with Mr. Fujioka for NOT awarding a blanket sole source contract to the gas company for water heaters to the Gas Company. This should be done in a fair, open, clearly competitive firm, fixed bidding process. Management at Mayor Wright, if residents need near term fixes has the budget to extract and do a few quick fixes so that residents are not out of hot water, but long term resolution is by firm, fixed, open, competitive bidding process. For quick fixes, Home Depot has instant, energy star efficient electric water heaters for just over $ 200.00 USD. Gas water heaters for just over $ 700 USD. I hope Home Depot bids, it sure would save the taxpayers alot of money vs $ 14 K per unit. As I have always told our clients, it is not what they tell you that can bite you, it is what they don’t say that can bite you. Ask all questions, get honest answers, firm, fixed price competitive bids is the way to go. Sole source should only be used in cases whereas the product or service is not obtainable in the open market, water heaters are not brain surgery. Best of luck to Mayor Wright’s and congrats to Aaron Fujioka for holding his ground and saving taxpayers money.
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