NEW PROVIDENCE, NJ - Although federal and state grants are welcome perks for funding many needed projects, the borough is facing strict and often costly requirements on how those projects are managed. The Borough Council discussed some of the “red tape” mandates at its Monday, April 24 meeting.

The issue came up when Councilman Jim Madden read a resolution for a change order for additional $12,500 to cover inspection services by Suburban Consulting Engineers, Inc. The original bid package was approximately $28,000. He expressed his concern regarding potential inspection costs. He calculated that the additional cost could reach $100,000. The inspection cost will come out of the borough’s pocket as according to regulations grant funds can’t be used for inspections.

“I’ve found that when dealing with a federal grant of this type, the regulations associated with the bidding of the projects, awarding the contracts and execution of the project are onerous, Borough Administrator Doug Marvin said. “For example, a full-time inspector is required whenever a contractor is performing the work. Generally speaking, these inspectors charge $80-$100 per hour. For each day the project is underway, the inspector costs can be in the range of $600-$800 per day. In addition, the engineering firm that designs the project cannot perform the inspections, which require additional contracting for those services,” he explained. Moreover, “all plans must be reviewed and approved by the State Department of Transportation (DOT) and all facets of the project must meet or exceed the latest federal regulations. Whether you’re installing a sidewalk or rebuilding the GW Bridge, the same standards apply.”  The borough is also required to have a responsible employee to actively manage the project. 

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The borough received a $245,000 federal grant for pedestrian safety enhancements in the downtown area. “The scope of the project was to include pedestrian safety improvements as well as what we called “phase 2” of the streetscape project. We designed the bid specifications to include work beyond the pedestrian safety grant as alternate bids so we could award different phases of the project based on how much each phase cost and what we appropriated for the overall work.  We felt that we would benefit from an economy of scale with a larger project,” Marvin explained.  However, the borough soon found out that the overall project would “fall under onerous federal regulations.” If the borough separated the alternate work out, it wouldn’t fall under the same inspection requirements – thus reducing the project costs. 

New Providence is also about to receive $460,000 from the Department of Transportation for the Safe Routes to School program. However, the borough has not received all details on this grant yet. When it comes to the strings attached “I would suspect that design costs and inspection costs associated with this grant will be in the $100,000-$150,000 range,” Marvin said.