Message-ID: <6534947.1075855716574.JavaMail.evans@thyme>
Date: Tue, 20 Feb 2001 01:38:00 -0800 (PST)
From: phillip.allen@enron.com
To: jacquestc@aol.com
Subject: Re: General Issues
Mime-Version: 1.0
Content-Type: text/plain; charset=us-ascii
Content-Transfer-Encoding: 7bit
X-From: Phillip K Allen
X-To: JacquesTC@aol.com @ ENRON
X-cc: 
X-bcc: 
X-Folder: \Phillip_Allen_June2001\Notes Folders\Sent
X-Origin: Allen-P
X-FileName: pallen.nsf

Jaques,

After meeting with George and Larry, it was clear that we have different 
definitions of cost and profit.  Their version includes the salary of a 
superintendent and a junior superintendent as hard costs equivalent to third 
party subs and materials.  Then there is a layer of "construction management" 
fees of 10%.  There are some small incidental cost that they listed would be 
paid out of this money.  But I think the majority of it is profit.  Finally 
the builders profit of 1.4 million.

Keith and I were not sure whether we would be open to paying the supers out 
of the cost or having them be paid out of the builders profit.  After all, if 
they are the builders why does there need to be two additional supervisors?  
We were definitely not intending to insert an additional 10% fee in addition 
to the superintendent costs.  George claims that all of these costs have been 
in the cost estimates that we have been using.  I reviewed the estimates and 
the superintendents are listed but I don't think the construction management 
fee is included.

George gave me some contracts that show how these fees are standard.  I will 
review and let you know what I think.

The GP issues don't seem to be a point of contention.  They are agreeable to 
the 3 out 4 approval process.

Let me know if you have opinions or sources that I can use to push for  only 
true costs + 1.4 million.

Phillip