The City of Aiken has issued an Request for Proposals for construction of the proposed $20 million “Mixed-Use” Office Building in downtown Aiken; and announced a Public Project Review Hearing for March 12th.

Prior to this action, the Aiken Corporation was acting as the City’s sole-source contractor managing the project, and charged with negotiating a lease with the Department of Energy’s (DOE) Savannah River National Laboratory (SRNL) and its operating contractor, Battelle Savannah River Alliance (BSRA). This setup created a high degree of fiscal and logistical inefficiencies, and required approval of actions by an unelected, unappointed, inexperienced, and marginally accountable third party.

Just as the project changed in early 2023 from the “Savannah River National Laboratory Workforce Development Center” to a “Mixed-Use Office Building” that might have the SRNL contractor as a tenant, the project has now changed from the “The Aiken Corporation New Mixed-Use Building Project,” to the “City of Aiken New Mixed-Use Building Project.”

The change in project responsibilities is a sensible move. Aiken has the experience and know-how, and city staff was already performing much of the work on behalf of the Aiken Corporation.

However, the architectural firm being utilized by the City was selected through a procurement process conducted by the Aiken Corporation, and not by the City of Aiken; and the future facility ownership by the Aiken Corporation remains questionable. While project advocates hope that Battelle Savannah River Alliance will be the tenant, negotiations remain ongoing and the DOE/SRNL long-term commitment remains underwhelming.

By Don Moniak

Feburary 20, 2024 Update

The City of Aiken’s contract with the architectural firm of Cheatham, Fletcher and Scott is available; buried in the City’s document repository in a newly created “Downtown Redevelopment” folder. The contract provides the data shown in the table below.

Final Design Due Date	May 20, 2024
Construction Start Date	December 16, 2024
Construction Completion Date	~February 2026
Design Contract Award	Not provided
Construction Budget	$14.4 million
Furniture, Furnishings, and Equipment Budget	$1.3 million
Land Acquisition Cost	$0.72 million

Original February 19, 2024 story

This past Thursday, February 15th, the City of Aiken’s Procurement Department issued a Request for Qualifications (RFQ) and Proposal (RFP) for Construction Manager at Risk (SM@R) Services for the City of Aiken New Mixed-Use Building Project.

The project involves a three-story, 36,000-square-foot office building to be constructed on one acre of vacant property on Newberry St, NW. The land is currently owned by the city’s nonprofit property management business partner, the Aiken Corporation. The organization purchased the land in July 2022 for $650,000, and in the midst of Project Pascalis, and claimed its future would be parking lot.

The stated plan for nearly a year is to construct the building, and transfer ownership to the Aiken Corporation (ACorp). According to a February 17th Aiken Standard article, that remains the plan. An additional step will require the City to first purchase the the Aiken Corporation property.

Thus the City will buy the property, construct the facility, and then transfer it to Aiken Corporation to own and manage. This confusing arrangement means that $20 million of state funds allocated to “SRS/National Laboratory Offsite Infrastructure” will actually become Aiken Corporation infrastructure that may house the DOE/SRNL contractor.

Up to this point, ACorp has been managing the predevelopment process as a sole-source City of Aiken contractor. That contractual process went so far as an Aiken Corporation-issued RFP for architectural services in late November 2023. According to the Aiken Standard story, last week ACorp officially awarded the design contract to the architectural firm of Cheatham Fletcher and Scott.

That firm is now identified in the City’s RFQ/RFP as being retained by the City of Aiken, not the Aiken Corporation:

“The City of Aiken has retained the services of a design consultant team led by Cheatham Fletcher Scott Architects (CFS) to develop the design and to prepare construction documents for the Project. The Project is currently in the early Concept Drawing Design phase.” (1)

In addition to the February 15th RFQ/RFP issuance, this past Friday the City also published in The Aiken Standard its notice of a March 12th Planning Commission Public Hearing that includes a “Project Review for Savannah River National Laboratory.” (Figure 1) The City of Aiken, not the Aiken Corporation, is the applicant. The application has yet to be publicly disclosed.

Final Design Due Date	May 20, 2024
Construction Start Date	December 16, 2024
Construction Completion Date	~February 2026
Design Contract Award	Not provided
Construction Budget	$14.4 million
Furniture, Furnishings, and Equipment Budget	$1.3 million

The Name Changes: From “SRNL Workforce Development Center” to “Mixed-Use Building” to “Aiken Corporation Mixed-Used Building” to “City of Aiken Mixed-Used Building.”

The downtown office building project is publicly funded with $20 million from the State of South Carolina’s plutonium settlement. Originally titled as Offsite Infrastructure SRS/National Lab, the stated intent in the City’s funding request was to build a 45,000 square foot “Workforce Development Center” on behalf of the Department of Energy’s (DOE) Savannah River National Laboratory (SRNL). The facility would be occupied by SRNL’s operation and management contractor, Battelle Savannah River Alliance (BSRA, or Battelle).

Since November 2022, the Aiken Corporation has functioned as the City’s sole-source project contractor. It was informally tasked by City officials with managing the project, its involvement was kept a secret for more than two months, and no formal public announcement of this project leadership arrangement was ever made prior to March 2023—perhaps due to trepidation over the Aiken Corporation’s controversial history.

With informal City approval, the Aiken Corporation hired a subcontractor, the architectural firm of McMillan Pazdan and Smith (MPS) to perform early tasks. The stated scope of work could be summarized as goal setting and needs assessment derived from a series of “stakeholder meetings” to be held with “minimal disruptions.” The word “public” was absent from the contract.

A month later, the City formally requested the $20 million of project funding from the State’s plutonium settlement fund. The settlement request form was unequivocally clear that the facility was to be built on behalf of SRNL.

On January 23, 2023, the project was announced with great fanfare at the State of the City Address—but the announcement omitted any mention of Aiken Corporation involvement. A public meeting was promised, and the City subsequently announced a public forum. That meeting was held two weeks later on February 6th and facilitated by MPS. An announcement of a “feasibility study” with a target date of May 1st was made by MPS representative K.J. Jacobs.

On March 13, 2023, Aiken City Council approved a no-bid, $250,000 contract for Aiken Corporation to conduct “pre-development work” and negotiate a lease for the 45,000-square-foot office complex. The contract specified the facility would be located on Richland and Newberry Streets on city-owned commercial properties purchased in November 2021, by the now-defunct Aiken Municipal Development Commission (AMDC), as part of its pursuit of the downtown redevelopment effort known as Project Pascalis.

The formal contract, approved three months after work began, officially named MPS as subcontractor for predevelopment services. The three-page scope of work assigned to MPS involved cultural and historic assessments, and “goal setting and programming” that had a heavy dose of public relations management. The scope did not include a site-selection analysis, facility design, or a feasibility study—although both were later completed and published within a single report.

The contract’s scope of work specifically cited SRNL as the only future tenant, and expressed a desire for what could be described as a party venue:

”The facility will house permanent employees as well as a rotating group of university faculty, students, and researchers who will work on critical projects for SRNL as part of a university consortium….There is also a desire for the building to have a rooftop gathering and event space.”

The Aiken Corporation was also contractually tasked with hiring an attorney to assist with lease negotiations. The Aiken law firm of Austin and Pethick had already been retained in early March, and eventually billed ACorp for more than a thousand dollars for preliminary work completed prior to the contract. Subsequent legal fees over the next six months would total more than $10,000.

For the next few months, lease negotiations slowly proceeded, but with no announcements of an agreement. The difficulty of negotiating with a federal contractor bound by complex procurement regulations became increasingly evident. In fact, by June 2023 the negotiating parties had signed a Nondisclosure Agreement, not a Memorandum of Understanding.

The “Mixed Use” Building

Somewhere along the way Aiken Corporation and City officials decided to stop referring to the project as the “SRNL Workforce Development Center.” In May 2023, the project was quietly rebranded as a new “Mixed-Use Building.” A series of guest columns in the Aiken Standard by Mayor Rick Osbon and three Aiken Corporation Board members followed, all praising the future benefits of a “Mixed-Use” facility that might house the SRNL contractor.

A few months later DOE/SRNL officially distanced itself from the site selection and project development process, saying it was only interested in office space if it became available. Unofficially, negotiations continued, and a Memorandum of Understanding (MOU) and Letter of Intent (LOI) was drafted for review by the ACorp Board.

Then, in September 2023, MPS finally released its well overdue “feasibility report.” Even though no amendments had been made to the ACorp-City of Aiken contract, MPS had considered four additional sites and completed a conceptual design that is still in use—one with the coveted rooftop gathering place in the form of a “covered terrace.”

MPS then made a recommendation to site the facility on the Aiken Corporation-owned Newberry Street, NW, property (Figure 2), and the ACorp Board then unanimously approved locating the $20 million office building constructed on its property. At its September 25th meeting, Aiken City Council gave a warm reception to the site recommendation during an ACorp presentation (2), but never went so far as approving the final site selection.

The Aiken Corporation’s New Mixed-Use Building.

Once the recommendation was made to build on Aiken Corporation property, it became an ACorp project. After months of costly negotations (4), the lack of a lease agreement remained a major hitch in the project. Negotiations between all parties—City, ACorp, DOE/SRNL, and BSRA—had stalled to the point that discussion emerged of an Aiken Corporation-owned building that might not even house lab employees.

The latter scenario was described in one City to Aiken Corporation email (5) as the “you build it and we will consider leasing it” option.

An SRNL official described the conundrum as a typical “chicken and egg” situation—the project could not proceed without a lease, and there could be no lease without the project; or at least some concrete progress to show to DOE’s authorizing officials.

With the uncertainty of the project’s future rising, the solution to provide evidence of progress was for Aiken Corporation to independently move forward with informal City approval. The process is more evidence that the partnership operates under a different set of rules—ones that are unwritten and allow for improvisation.

Even though its contract with the City did not include design services, on November 9th the ACorp Board approved pursuing an architectural design procurement process. On November 20th it issued a set of Design Scope Details, and that was followed on November 28th with a Request for Qualifications (RFQ) For Architectural and Engineering Services For The Aiken Corporation New Mixed-Use Building Project.

The Aiken Corporation RFQ bore a strong resemblance to City of Aiken procurement documents, and for good reason—city staff did most of the work. According to City of Aiken emails (6), the Aiken Corporation had no experience with RFQs or RFPs. To accommodate the organization, the city’s Economic Development and Procurement departments coordinated to retain a highly experienced and successful project oversight manager to compile project specifications, turned a rough draft into a finished RFQ, and wrote the RFQ legal notice and then arranged for its publication in the Aiken Standard.

A few weeks after the ACorp RFQ was released, the Department of Energy authorized its SRNL operating contractor to negotiate a one-year lease for the facility, with renewable one-year leases for up to ten years—contrasting sharply with the ten-year office space leases in Aiken County’s Carrol H. Warner Savannah River Research Campus between the County and the DOE/SRNL contractor. In fact, on September 25, 2023, ACorp Board member Pat Cunning told Aiken City Council that,

“The lease will probably be a 10-year lease, with two ten year options. He said a concern is what happens if the Lab does not extend the lease after 10 years. He said he did not think that would happen, but in real estate you have to plan for such things.”

Meanwhile, the City of Aiken released a Request for Qualifications for Real Estate Services to procure a real estate firm to market the Hotel Aiken and the Pascalis properties; properties that eight months earlier had been presented as a sure bet for the SRNL project.

With some leasing commitment—though still no signed papers—in place, Aiken City Council moved forward on January 8, 2024 with an ordinance to incorporate the $20 million of plutonium settlement funds into the City budget. The staff’s supporting memorandum for the budget amendment stated that,

“City staff is working with Aiken Corporation on an agreement that will be before Council at a future meeting in February. “

The budget amendment ordinance was approved unanimously following the first public hearing, and Council granted final unanimous approval following the second public hearing on January 22, 2024.

From that point, it was assumed the Aiken Corporation would continue to formally run the show— if only for appearance sake. The ACorp’s January 10th meeting minutes described Chairman Buzz Rich stating that, “The next step is to hire an architect and start the design work…He plans to meet next with the City Manager to discuss further details.”

The City of Aiken’s New Mixed-Use Building

The next step, as it turned out, was the City of Aiken taking over project management and hiring the architectural firm; one that was selected through the ACorp’s procurement process. Mark Chostner’s Capstone Services—which has overseen project management of the new Public Safety Headquarters and the new Municipal Building—is now listed as being in charge of the City’s, and not Aiken Corporation’s, “owner project management services.”

The City of Aiken routinely procures and manages expensive professional service contracts and multimillion dollar public works projects. Its Procurement department follows standard procedures and avoids legal challenges to its bid awards. In contrast, the Aiken Corporation stumbled through its $250,000 predevelopment contract, and needed city staff and Capstone Services to complete its first and only RFQ this century.

It only makes sense to avoid the use of any third-party surrogate administrator and avoid the kind of increased logistical and fiscal inefficiencies that accompanied the Aiken Corporation’s “predevelopment” contract.

Lingering Questions and Issues

Even though the City’s assumption of project management can be viewed as a welcome development, several lingering, related questions remain.

First, how did the City manage to retain Cheatham Fletcher and Scott as its architectural design firm without going through its own required procurement process? The answer is probably that the city’s Procurement department ensured that the ACorp’s improvised process adhered to standard procedures—but if so the fact remains the City conducted the process through a surrogate that did not have the fiscal or contractual authority to proceed.

Second, who is the future owner of the building? The City of Aiken is now the “owner,” at least during the design and construction contract phases. Aiken Corporation is still the likely final owner and landlord.

The agenda for the Aiken Corporation’s February meeting included “Deliberations, discussions and any motions or resolutions about next steps in the development of the Newberry Street property, including but not limited to a Framework Agreement and a Purchase and Sales Agreement with the city of Aiken.”

According to the Aiken Standard’s Feburary 17th story, that framework is what has been marketed by the City-ACorp partnership since June 2023. The concept is referred to the “Amentum Model,” even though the Amentum Corporation was nonexistent when the property management model was conceived in the early 2000s. It is better titled “The Aiken Corporation Model. “

The Aiken Corporation model means the City would purchase the property from ACorp, construct the facility, transfer the facility back to ACorp, and rent the property itself to ACorp under a long-term ground lease.

That leads to the third question: If the Battelle Savannah River Alliance does sign a one-year lease, but does not renew it in the next several years, will that constitute a misappropriation of the $20 million legislative allocation for “SRS/National Lab Offsite Infrastructure?”

The last two questions could be resolved through the simpler rent-free alternative of the City constructing the facility and then gifting it to the State’s major universities.

Creating a “Workplace Development Center” was one example of the “substantial investment” promised by the State of South Carolina for USC, Clemson, and South Carolina State University to be part of the Battelle alliance. Since the state chose to honor this commitment by allocating $20 million of plutonium settlement funds, our higher education system should be granted ownership, and retain that ownership if and when the SRNL operating contractor ceases to occupy the “City of Aiken’s New Mixed-Use Building.”

Next: “We Need the Space.”
and “Aiken Corporation Accomplishments: Mostly Pre-2015”

Footnotes and References

(1) How the City of Aiken retained a design firm without its own official RFP is unknown, and City officials did not respond to questions posed late Friday afternoon about the issue.

The Aiken Corporation RFP and associated legal notice was largely prepared by city staff; and did bear all the markings of the city’s procurement process. However, the ACorp architectural design services RFQ was not authorized by any City Council-approved contract.

(2) As reported in $148,000 For What…., an historic assessment was actually conducted under separate, unannounced contracts between the City of Aiken and McMillan Pazdan and Smith.

(3) With the City’s assistance, Aiken Corporation pursued public support for the project. A September 13, 2023 email from a City official urged dissemination of the ACorp’s new FB page:

“The Aiken Corporation Facebook page is now live and promoting the meetings. Please share with all Aiken Corp and Chamber fiends and contacts and ask that they follow the (Facebook) page and post supportive comments as appropriate.”

“Fiends” was an original typo. Neither the Facebook page nor the Aiken Corporation website devoted to the project have been updated since late September.

A strong showing was also urged for City Council’s September 25, 2024, public meeting, during which the MPS and Aiken Corporation recommendation was presented.

In fact, the Aiken Corporation has accomplished very little since around 2015, after its longtime Chairman Wade Brodie left the organization. Mr. Brodie was a tireless worker, and nearly every accomplishment touted by the current Board was completed under his tenure.

Since 2015, the Board has struggled with finding its way. It was finally forced to demolish its “spec building” on Beaufort Street after more than a decade of unsuccessfully trying to attract a tenant. The positive news is that the property is now the location for the new Children’s Place facility.

(4) As part of its contract with the City of Aiken, by October 2023, the Aiken Corporation had accumulated more than $10,000 in legal fees related to the lease negotiations. The costs of other involved parties—-city staff, DOE attorneys, SRNL officials, BSRA representatives, etc—is unknown. This information is known due to the Aiken Corporation’s prompt response to a Freedom of Information Act request for invoices submitted by McMillan Pazdan and Smith and Austin and Pethick.

(5) Emails related to the fall 2023 negotiations are available for viewing at this page.

(6) Example of emails related to City staff preparation of the RFQ are available for viewing at this page.

Related Aiken Chronicles articles and editorials, in descending order of publication: 

One-Year Lease After One-Year Lease…. details the results of the latest negotiations between SRNL’s operating contractor and the Aiken Corporation.

The Rent Free Alternative is a review of the option of the City of Aiken taking over the SRNL/Mixed-Use project, constructing the facility, and then gifting the facility to the state’s Universities.

The Aiken Corporation-City of Aiken Relationship: Partners, Not Cousins analyzes the

The Aiken Corporation Building was published in conjunction with this article to illustrate the changes in corporate tenancy in the Aiken Corporation Building. 

Information Release: Hotel Aiken Stabilization Study and Other Documents…. provides links to documents related to the SRNL/Mixed-Use project and the Hotel Aiken stabilization effort.

148,000 For What….reviews the payments and progress made in the Aiken Corporation contract.

Aiken’s Cousin Problem… covers the recommendation of the Aiken Corporation’s Newberry Street, NW property for the SRNL/“Mixed-Use” project; and the history of the acquisition of that property. 

The three-part series The Amentum Model… chronicles the history of the development of the Aiken Corporation’s Newberry Street office building and the Aiken Performing Arts Center.  

The Devil is in the Details…addressed the selection process for the SRNL/“Mixed Use” facility. 

Thoughts on the Aiken Corporation is an editorial and analysis exploring the need for the organization and past efforts at accountability. 

Gathering on the Rooftop Terrace is an editorial and analysis of the McMillan Pazdan and Smith SRNL/“Mixed Use” project feasibility study. 

The Bomb Plant Reveal…Bombs is an editorial and analysis of the feasibility study process. 

Letter to Battelle is a letter of concern regarding the project process and status to the Battelle Company’s chief liaison for the DOE/SRNL operating contract.  

Aiken Corporation Issued a Notice of Violation is a news release regarding the SC Secretary of State’s citation of Aiken Corporation for late filing of necessary tax forms. 

45,000 Square Feet Without a Tenant provides information about the DOE/SRNL disassociation with the project and the details of the DOE/SRNL operating contract. 

What is the Status of the Savannah River National Laboratory Building Downtown provides a full transcript and summary of the Aiken Corporation’s May 2023 Executive Committee meeting. 

A Question on Security is an unanswered letter to ACorp contractor McMillan Pazdan and Smith regarding Department of Homeland Security guidelines and rules for threat assessments at federal facilities. 

The Future of Warneke Cleaners is an unanswered letter to Aiken Corporation contractor McMillan Pazdan and Smith regarding the zoning status of downtown dry cleaner. 

Three Missing Pages covers the Aiken Corporation contract with the City of Aiken and provides extensive footnotes about the project timeline through April 2023. 

Who Bought this Property chronicles how an Aiken Corporation loan from the City of Aiken was forgiven in exchange for ACorp purchasing a small property that facilitated the annexation of the new Steeplechase property. 

The Agenda Setting Aiken Corporation describes how decisions are often made at Aiken Corporation Board meetings before being presented to City Council. 

Project Labscalis Annual Operating Costs covers the total estimated costs for demolition and site prep, construction, and annual maintenance costs for the proposed SRNL building. 

Structured Parking Solution for the Lab is about the connection between a proposed parking garage and the lab project. 

Off-Site Infrastructure provides the history of the lab project and the plutonium settlement disbursement process. 

There’s a Joke in There Somewhere is about the State of the City Address where the lab announcement was made. 

Aiken Corporation Registration Expired is a review of the organization and details how its not-for-profit status temporarily expired in 2022. 

Other related articles:  

Aiken Standard 3/16/23 by M. Christian, Aiken City Council Approves Aiken Corporation Agreement Moving New Downtown Project Forward

Aiken Standard; 5/29/23; by M. Christian.  Savannah River National Lab considered two other downtown Aiken sites for workforce center

The video of the February 6, 2023 Public Forum, or ‘listening session’ is available on the City’s You Tube channel. .

I wanted to share an update on the Aiken Corporation board meeting that took place yesterday. The board has agreed to proceed with issuing an RFQ for design services, which will include all preconstruction activities and the preparation of a bid package for a GC. The RFQ should be issued in the next 30 days, and firms will have 30 days to respond.