001I call the meeting to order. It is 8:00 p.m. Uh welcome everyone. Please rise for the Pledge of Allegiance. I pledge allegiance to the flag of the United States of America and to the republic for which it stands, one nation under God, indivisible, with liberty and justice for all. Please be seated. I do need a motion to approve tonight's agenda. >> So moved. >> Second. >> Motion and a second. All in favor say aye. >> Aye. >> Any opposed? Hearing none, the motion carries. Moving in the Moving into the one action item, uh the LMS parking lot uh sidewalks. What's um holding up the surety bond? I'm just curious. >> Um so we started our claim with them in March of this year. Uh they It took a little It's kind of been a long
002thing. So we initially had one person. They transferred it to another person. Um we sent them our initial report. They wanted to send someone out on site to do it uh an inspection on behalf of the surety. Um that individual came out, took them From that time they decided it took about 2 weeks for him to come out. He came out, walked it with our architect's West team and Tim Hague, our director of facilities. Once they were done with that, it took them another 2 weeks to get the report back. Once he got the report back, um they essentially offered only what was in retainage to get it fixed, which is not sufficient to fix the issues that we have. Um so, we went back again and essentially using the information that we had from
003our alternate bid, uh they were like 157% undervaluing the the dollar amount of the work based on this area's rates. Um and so, we sent back a rebuttal saying, like, factor it out based on an existing bid that we have, this is how much we actually need to fix it, which is about $277,000 um to fix it, of which we only have about 105 in retainage. Um and so, if the ball's back in their court right now, we did push them letting them know that we need a response, and we've been very upfront with them from the beginning that we had work being done this summer that needed to be done in tandem with us, and we needed a decision. Um we received a response that it can wait a couple weeks, nothing's that urgent.
004I beg to differ. Um and so, that individual's on vacation right now. Um and so, this is the boat that we're in. In order to get the concrete done in tandem, which we do need to do cuz it's part of the scope of the work with the change in the parking lot flow, um we need to essentially pivot at this point and look at it another way to pay for this. I cannot I did seek legal. Um I cannot pay for it out of the retainage um cuz that's technically still in contract that's being disputed with the surety. Um the sidewalks are part of the entire scope of the parking lot revision project that we've already approved. Um so, my ask is to use uh school modernization funds for it because it is approved as
005part of the scope of that project and it falls in line with what we're doing there. If we happen to get the surety to agree to the dollar amount that we have, I'll transfer the expense out of the school modernization funds and offset it against what we receive from the surety. If not, um it can just live there because it is an authorized expenditure out of that budget. So, I guess I'm bringing it to you asking at this point, can we please do it this way so that we can get the work done? Um I would have loved to bring this to you sooner. We were hoping to bring the entire package to you for approval. Um we're just at the mercy of the surety timing at this point in time. Um because we need
006to get on the contractor schedule for the concrete, that's why it's such such a like emergent issue at this point in time. Um I was very hopeful when the vendor came out and did the inspections that we would have had a response well before now and it just it hasn't come to fruition. >> Will uh whatever we're doing with the concrete that we just replaced, that wasn't replaced well enough, that we're going to tear up to do this parking lot, if we tear it up before we have anything resolved with surety, is that going to impact >> Yeah. So, I have a note in here that proceeding with this work before final surety decision carries a risk that the district might not fully recoup this the cost from the performance bond. However, if it is
007successful, we'll be able to reimburse the expense essentially. So, we do run a risk and Megan, I talked to Megan about about this and that's something she wants to be very clear on, but we also run the risk of pushing this project off to next year to redo the parking lot at Lake Glen Middle School cuz it there is so much of the scope that does revolve around this change in the concrete that needs to be done. >> So, what are we taking the money away from? >> At this point, it's just the remaining funds in the school monetization funds. We did have a great construction meeting today with Janel. It sounds like there was a a piece of HVAC equipment that initially was marked for replacement that's not going to be replaced now. It
008sounds like we're getting in about $60,000 back on a piece of equipment that we're not replacing. It doesn't need to be replaced and so that kind of washes in this project at this point in time. I didn't have enough of a contingency built into this project to cover this this concrete. The contingency we had built in specific to the the parking lot just and it's also a dollar amount above my threshold. I need board approval because it's about $50,000. So, I have a couple complicating factors with it. But we already have the bids in place. We already have the contractor in place. We just need permission for what bucket of money it's going to come out of for the time being. >> So, with the surety dollars if we do this, do we run the
009risk of getting nothing? >> No, just the specific site. Only the specific site. I did ask Megan that question as well. We don't run the risk of it's only it's site specific cuz we have multiple sites that we're asking. >> But nothing for this site. >> This is this is all of it. We basically because the the concrete mix didn't have the fiber in it, we're asking to redo the entire project at this point. Um whether or not we'll get that remains to be seen. I will make sure to share with the board the the correspondence between the surety and our legal the kind of the back and forth so that you guys have it for your reading pleasure. They're they're long and detailed. Um but we it's been back and forth. Um the representative
010that the surety sent out said that they weren't going to do anything for aesthetics, but it's not an aesthetic issue. It's they're not >> It's structural >> It's integrity >> It's structural integrity. They're not on grade. They didn't pour to the right depths. Like there are so many issues with this concrete. That is madening. >> [laughter] >> That it's this bad. Um so we're continuing to work diligently with the surety. Um we're just at their mercy of getting back to us at this point in time. It's It's a knee-tiny work with insurance, right? They don't want to pay out more than they have to, and so it's that back and forth that we're in the middle of. Right. >> Can we deliver all the concrete to their office? And here you go. >> I mean
011>> At some expense to the district. >> Well, I got a trailer. >> The and I I [laughter] believe the surety is well out of state. Um I have some other places that I'd like to put that concrete, but >> [laughter] >> Yeah. So this this has been I would say it it's not um it's not a lack of a process at anything on the district side. We we've done our due diligence. We were following we were having OAC meetings. Like we we were meeting with the contractor that did the initial work regularly. It's just we're on on the mercy of getting the surety. I mean when we went through the last surety claim related to the non-payment of subcontractors for the Apple and Spirit Lake Elementary projects, it took almost 9 months to get
012a finalization on that one. And that was just getting them to pay the subs. That wasn't to redo any work cuz the work didn't need to be redone. We were very fortunate in that one. So it was more of a pull on the payment bond instead of the performance bond. We do have a claim. Um I do want you to know that we do have a claim against the payment bond as well. So, we're seeking the performance bond right now cuz that's There's two separate ones. The performance bond um is on behalf of the the workmanship, right? Um the payment bond uh Interstate Concrete has not been paid to the tune of $105,000 for the concrete that the contractor had pro- procured for them from our project. Um it's not the district's expense. It's the
013contractor's expense, but they are going after the payment bond to obtain that payment. >> So, are we competing with them for the payment bond? >> No. No. No. We're only going after the performance bond at this point in time. We assist them with the payment bond portion of it. >> Okay. >> I'm just letting you know that someone is making a claim against the payment bond. >> And it can't come back against the district. But we >> That's why we get these payment and performance bonds. >> Okay, but for the shotty work that was done, we still owe the contractor and we withheld payment. >> Yes, $105,000. >> Okay. So, now they haven't paid their their supplier of the concrete the $105,000. >> ours was $137, but we keep accruing legal fees and so that
014reduces retainage cuz the legal fees go against this project and that's part of what we work with the surety on. The more that like the architect and the attorney have to work on this, the more their fees are and that has to come off of what the surety claims is as well. Um It We're It shouldn't cost the district any additional funding and that's what we're trying to We're trying to get the work done correctly through the appropriate means, which is pulling the the performance bond on this. It's just a time-consuming process. >> So, initially, we will pay for this out of the school modernization, and then if we get the surety bond >> We We can also we would >> Yeah, replace those dollars. >> We also have funding in plant facility levy, which
015is where the concrete was initially paid for from. Um, we had money that we weren't use We had kind of held off on flooring projects and stuff like that. So, we could also just take it out of the plant facility levy. Um, and just >> do we have left [snorts] in there? >> If we It's 340,000 for the the flooring projects. So, we could pull it off of that, and then it either can just get re- repurposed for um the concrete if we don't get reimbursed, or if we get reimbursed, it just can go back into that line item if that's what we so choose. Um, we had talked about that recently about potentially making an emergency ex- like building repair fund out of it, but um we had it had been decided to just
016leave it for now and then address it as need be. So, we have a couple spots we can do this from. Um, I just thought that the modernization funds because that's where this entire project's coming from made logical sense. Um, but I >> Well, and that has the most restrictions on it, so that would make sense to be in. So. >> And this is an authorized project out of there. >> And we didn't contemplate the concrete work that needed to be done in this project in the beginning. Why? >> We did, and we received bids for it. Like, we bid out this project as part of that thing. We The problem was the timeline with the surety. Um this concrete >> But I mean it wasn't brought to the board for approval. >> Right, because
017we were anticipating the surety would have made a decision by now. That timeline has moved multiple times. Sorry, I completely understand what you're >> be I mean I I guess what I it seems like because this was part of the project, it should have been brought forward with the project with clarification that this is how it's being funded with the surety bond. And you know, if it's not this is this is where it's going to be. It's a It's a whole picture and I feel like it wasn't I mean it wasn't brought forward because we thought we were going to pull the money over here from the surety bond, but then we're not being given a whole picture and that's what is often challenging when you're having to piece the picture together like a puzzle
018because you're not getting a whole picture in the beginning. >> And I apologize these board docs were included with the the the bids that include these alternates for the concrete work specifically were included in the original two board packets related to this project. We just didn't specifically call out the concrete piece of it. Um so my apologies, I'll make sure to >> This is what happens with contractors. This happens all the time in every job all across the state. >> What are you referring to? >> This shoddy work and >> Oh, like I know the shoddy work. >> and all the bonds and all this crap. >> Yeah. >> Everybody makes money except the freaking person that gets screwed over. >> Yeah, right. >> You know. >> So, in the future [clears throat] if we
019have this come up again, which I pray that we never have to deal with a payment performance bond ever again in my lifetime of working for a district or anywhere else cuz they're not fun. I do not enjoy this part of my job. Having to do two in two years is unheard of Um but I'll just make sure that we make sure that it's a full presentation in the future. I this >> This is why we started including surety bond payment bonds and and that this we learned our lesson so >> Which they didn't do in the past, right? >> No, they didn't. So >> I'll move to approve as recommended. >> it. >> We have a motion and a second. All in favor say I. >> I. >> Any opposed? Hearing none, the motion
020carries. On that note, we'll go ahead and end the meeting. It's 8:15. >> 8:15. >> I appreciate it. >> Thank you, Jess, for putting that together. >> Ooh, and good guess on the 15 minutes. >> Was it 15?