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Friday, August 8, 2008

Water 14 Settlement will “Surrender” another Million to Contractor


An informational meeting held at town hall on the overspent and mismanaged Water District 14 gave a glimpse of behind the scenes negotiations with the contractor which will, if agreed to by the Town Board, cost taxpayers over a million dollars more than has already been authorized by voters.

There is a story covering the meeting in the Ttroy Record which you can read here. Briefly, Casale wants another $800,000, half for work he has already completed and not been paid for and the other half for work to complete the district. The math adds up this way:

Contract Price: 6.4 million
Bonded amount approved by voters: 7.1 million
Amount improperly spent over the bond from other town funds: $268,000
Amount “Owed” to contractor: $800,000
Total cost of District if approved: $8,168,000
Amount over Bid price: $1.7 million
Amount over Bond Authorization: $1,168,000

Of course the town board would have to agree to a settlement before the numbers hit home in your tax bills. But it appears that is the direction a Conservative majority is leaning to which avoids voter approval of the additional money and fails to challenge the contractor in court over the interpretation of the contract.

The option unlikely to occur is to fight to enforce a contract interpretation that means less money paid by taxpayers. To do this, the town could hire someone else to finish the work and litigate the matter. How will it end? Well by costing residents more money and no one responsible for approving all those payments is ever held accountable. Sweet hey?

There is also the issue of all that restoration work which has been somewhat overlooked. Many driveways were “restored” with a base coat and never finished with a top coat. Has the town inventoried the districts and polished its so called “punch list” of needed corrections? Better sharpen your pencils because a great deal of restoration work was done by our Highway Department and must be billed back to the contractor and his bottom line.

No matter how you cut it, a settlement of this nature amounts to a surrender to the contractor’s demands. General Lee may soon return to a court house. But this time it won't be Appomattox and the other General will be wearing a hard hat.

5 comments:

Anonymous said...

Is this not the only water problem in town? Is it true that the folks around Teliska and Oak Street have such low water pressure that it is below health dept. standards? Is it true that the town doesn't seem to remidy this? It seems those in charge just can't handle it.

Joe.Mazoway@ogs.state.ny.us said...

Joe.Mazoway@ogs.state.ny.us> wrote:
Do you know why the price has escalated?? NO you don't. You know nothing about construction and that's obvious. Did you know the price of steel pipe changes daily?? The same with copper. How would you like to bid a job and have the price of the material go up over 200% in a matter of months. Even the engineers that design the projects and the construction personnel hit unforeseen things that cost money.That is why you always hear the terms "change orders" and "field orders" on projects and they are designed to cover those unforeseen cost. Hey Charlie, how would you like to be the guy who bid on hauling wiggites in your trucks 2 years ago. Lets say you had 100K budgeted for your gas and now its 300K. Are you still going to do it for the same price?? I don't think so!! If you do your going out of business. You would go back to the customer and ask for a change order to cover the escalating fuel cost. This would be unforeseen right???
Did you look at the contractors Detailed Estimate that he has to turn in before starting the project and see where the cost have escalated and why?
No you didn't!! You just run your mouth without presenting the facts, you just make general statements, and these cost maybe legitimate. Almost every construction project comes in over budget due to unforeseen circumstances.
You would not know this because you have no knowledge of construction so the best thing for you to do is just keep quite. Why open your mouth and remove all doubt that you are still an idiot and have been since grammar school
when I first meet you.
Please shut up.

The North Greenbush Pipeline said...

Dear Mr. Mazoway,

Permit me to shed some light on your initially well intentioned thoughts. All of us understand that prices can change for any business. However the problem with your essay rests in part on a lack of adherence to the very process you cite. We have a 6.4 million dollar contract that has now exceeded 7.1 million dollars without the CHANGE ORDERS you correctly and reasonably expected to account for the difference.

Had you bothered to read the State Comptrollers audit or other entries in this publication, you would have known that town officials bothered to get but ONE change order for approximately $13,000. That's it Mr. Mazoway, all they did. The rest was just pure malfeasance. Surely Mr. Mazoway, as a employee of NY State OGS and a former Zoning Board member, you know how it works?

Further, many of the product costs you cite are bid on and they are fixed. They cannot be amended by the contractor because of increased costs, ie pipe, his gasoline use, his labor costs or hourly wages. He and his competitor each agreed to a unit price on each of the items used in construction. They ususally buy those items in sufficient quantities when they win the contract to ensure stable pricing. Sure there may be times when an estimate is off and more units could be approved in one area or another than were authorized. And that's fine so long as the contract price is not exceeded. Otherwise a contract price has absolutely no meaning and bids have no meaning. Is that the way you would run a business? Is that how you buy a house by signing a contract for an agreed to price and then without warning (change orders) be presented with bills for much more?

The cost escalated in this deal because people in town hall authorized things that were not part of the contract. They did so without regard for the contract price, the spending limits imposed by voter approved bonding, State Law or change orders which would have secured the permission of the municipal board for those alterations to the contracted work. Again, read the State Comptroller's audit, thoroughly so you can see how people in town hall did their jobs.

I regret that you have so little confidence in your position that you find the need to engage in petty childish name calling. By now you should be well beyond the need to engage in disparaging commentary to satisfy your apparent desire to your own set of facts.

Did we really attend the same schools Mr. Mazoway?? If so, we did not learn the same lessons of respect.

Anonymous said...

Merriam-Webster definition of the word "contract" - a business arrangement for the supply of goods or services at a fixed price

Need I say more? Look it up. Finish the job for the amount agreed to in the contract.

Anonymous said...

The contract should have had an escalation clause ... The contract should have had an escalation clause to begin with. Mr. Mazoway, shame on you for not knowing that! Are you getting raises everytime gas, food, etc. go up? I don't think OGS does that for you. If Casale couldn't get the job done for the bid price - he shouldn't have bid it in the first place. Actually, he didn't really win the bid anyway - did he???