City leaders ‘frustrated’ with high-dollar additions to fire station restoration project

photo by: Nick Gerik

Construction continues at Lawrence's Fire Station No. 1, 746 Kentucky St., Monday, Jan. 7, 2019.

After reviewing hundreds of thousands of dollars of additions to the rehabilitation of a Lawrence fire station and adjacent senior center, city leaders said they were frustrated that some of the additions weren’t included in the original scope of the project.

So far, there have been 26 additions or modifications to the project, known as change orders, and the project’s cost now totals more than $7 million, according to a city staff memo to the commission. The Lawrence City Commission reviewed the change orders as part of its meeting Tuesday. Vice Mayor Lisa Larsen questioned the change orders and why some of them were not included in the original design. Larsen said some of the items seemed basic, such as the addition of a sink in the break room.

“I see like six items there that seem like they should have been part of the design project, and so I’m curious as to why they didn’t go into the design to start with,” Larsen said. “Because that’s where it starts is your design, and then bidders come in and bid based off the line items provided by whoever made the bid up.”

Some of Larsen’s questions about change orders concerned the addition of the break room sink, relocation of a sand/oil separator and addressing a TV that was blocking electrical and timer systems.

The project’s budget set aside $260,000 for contingency, and so far $216,000 has been spent, according to the memo. Some additional change orders are pending, and those are estimated to cost about $85,000. Assistant City Manager Diane Stoddard previously told the Journal-World that those change orders are in addition to an approximately $250,000 change order that was approved early in the project and incorporated in the project’s budget.

Interim Fire Chief Shaun Coffey noted that other change orders could not have been foreseen. For instance, Coffey noted that once the sewer line beneath the building was uncovered, there was an issue identified that was causing the line to back up. The change order for that repair was about $45,000. He said repairing the line as part of the project was less expensive than coming back and doing it later, and that there were other similar issues found as contractors opened walls and ceilings.

In addition, Coffey noted that other modifications, such as mimicking the original plaster ceilings, were related to preserving or restoring historic aspects of the building. The city expects to receive $1.4 million in historic tax credits once the project is complete.

Commissioner Matthew Herbert, who owns his own property management company, also said he found the quantity of change orders frustrating and that it seemed like some of them could have been foreseen and included on the front end. He noted that another change order for about $12,500 was related to an electrical modification that he said was required under city code.

“That’s just frustrating to me,” Herbert said. “I totally understand change orders when you rip out a ceiling and you have no idea what’s behind it, but that’s just basic electrical code.”

Jay Zimmerschied of Zimmerschied Architecture Inc. was hired as the city’s architect and consultant on the project. In December 2017, the commission voted to award the bid for the project to Lawrence-based B.A. Green Construction.

photo by: Nick Gerik

Construction continues at the Senior Resource Center of Douglas County building, which is connected to Lawrence’s Fire Station No. 1, Monday, Jan. 7, 2019, at the intersection of Eighth and Vermont streets.

Zimmerschied, who was present at Tuesday’s meeting, acknowledged that some of the complexities with the electrical placements were not identified in the original design and that particular issue was “missed.” He said some of the other issues were known to a degree but were more complicated than anticipated.

City Manager Tom Markus said that if the design would have shown everything now identified, the cost of the contract would have been higher. However, Markus acknowledged that if those change orders had been part of a bid, the city may have ended up paying less for them.

“Because the contractor is sharpening their pencil to be competitive at that particular point in time, and so you don’t know that this same cost would have been there,” Markus said. “So, there is a marginal difference in my opinion.”

Because of that, Markus added, he did a walk-through of the building and asked some of the same questions that commissioners were raising.

Last year, a multi-month review by the Journal-World found that there were 103 change orders to city projects in 2017. Some of them resulted in changes to contracts or bid amounts that reduced the price of the project, but far more increased the cost of city-approved work. In total, change orders added $2.17 million in additional costs.

Larsen asked if the city has anything in its contract for the fire station regarding change orders that should have been in the original bid. She also asked if the city could renegotiate a lower price for some of the change orders.

Markus responded that he thinks not having engagement between contractors and designers early on in the process, as opposed to what’s possible with recently approved alternative bidding methods, can lead to some of the issues seen with the fire station rehabilitation. The fire station rehabilitation project went through a traditional low-bid process. However, Markus said there have been discussions among city staff as to whether prices might be lowered.

“I’d have to look at the contract to be specific, but I think that when you have professional services and acknowledgment that something was missed, whether it’s in the contract or not, I think that there are opportunities to discuss how those fees might be adjudicated,” Markus said.

The Douglas County Senior Resource Center is housed in the eastern portion of the building, and the city and county previously agreed to jointly fund the project. As part of its meeting, the city commission also voted to update the agreement with the new costs for the project. The commission must approve any additional change orders that surpass the contingency amount.

City Commission Work Session 01/08/19


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