Work to Start Without Penalty Clause

The change order that is associated with the renovation and repair of Building 8 at Jefferson County High School has been signed,as of February 6, 2015, according to Jefferson County Finance Director Potts. Previously, there had been some exchange regarding the terms associated with the change order. According to information provided, attorneys for Jefferson County had suggested that a penalty clause be included in the Building 8 change order to assure that the scope of work would be completed by July 6, 2015, which will directly impact the release of retained funds. Currently, the insurance provider, Travelers Insurance, is holding $255,385 until the completion of a portion of the repairs to Building 8. Should those repairs not be completed by the July 6, 2015 date, it is unlikely that Travelers Insurance will release those funds.

Though the Building 8 project was fully funded by the County Commission on December 30, 2014 and the issuance of bonds was approved by the County Commission in January, the Construction Manager contended that only $545,000 of funding had been released as of February 5, 2015. Rentenbach Constructors Inc has been retained as the Construction Manager for the renovation and restoration of Jefferson County High School proper and , through a change order, the restoration and renovation of Building 8. Vice President Anthony Pettit replied to the query regarding the addition of a penalty clause and informed the County that Rentenbach will not accept an amendment to their contract or change order that includes penalties for the milestone completion date of July 6, 2015. He further stated that three months had passed since the first proposal of the work to be done on Building 8 and that they are awaiting notice to proceed.

Michael Phagan, Director or Business Affairs for Jefferson County Schools, stated on Friday that he had only released the amount of funds that had been recovered from the insurance company, which was $540,124 of a total of $3.6 million in funding that has been allocated for the Building 8 portion. He said that he did not feel comfortable releasing additional funds that are available, such as the $251,474 that was assigned to Building 8 from the JCHS proper renovation funding, until the change order had been reviewed and signed. He noted previous circumstances with funding that came into question and the need for assurance that the funding would be forthcoming via bond issuance before releasing any currently available funds. Phagan stated that questions were raised regarding the change order, following attorney review and that until the change order has been signed he would not be releasing funds. Though the initial start date of the project has been pushed back nearly one month, Phagan stated that he is still confident that the July deadline will be met. He said that he would have liked to have had a penalty clause on the front end of the contract but it was not part of the original negotiation and he feels it is impractical at this point because it will delay the project further. Phagan stated that, if the penalty clause was to be included, it should have been a part of the bid package which would hold the sub contractors to the completion date of July 6, 2015. Though there has never been nor will there be a penalty clause included in the change order, Phagan said that he has had verbal assurance from Rentenbach that they will make every effort to meet the milestone deadline.