Vendor failure causes council friction, Grand Park funding issues

A request to fulfill remaining contract obligations from Grand Park Sports Complex construction caused concern for a couple of city councilors.

The failure of vendors to adequately perform their tasks has created a temporary need for additional funds for the continued development of the Grand Park’s infrastructure to avoid further additional costs to be unnecessarily incurred.

The cost for the appropriation is $6 million, which will come from the city’s infrastructure improvement fund, which monies come from the sale of the city’s water and wastewater utilities. Chief of Staff Todd Burtron said any appropriated funds will be reimbursed to the infrastructure improvement fund as assets become available.

Spoljaric

Spoljaric

Councilor Cindy Spoljaric said her concern with the appropriation is how the public was told prior to the sale that the city would not use funds on Grand Park. Fellow councilor Rob Stokes also expressed apprehension about the “temporary transfer” and if/how the funds would be repaid.

“This was a surprise. What’s the urgency here?,” Stokes said. “Are monies refunded by sponsorship dollars or to get funds is this going to impact other projects that need these funds?”

Burtron said almost $3 million of the total comes from vendor failure, $2 million is sponsorship money the city had anticipated to have received by now and the remaining $1 million is needed for infrastructure improvements surrounding the proposed 372,000-square-foot indoor facility at Grand Park.

“The funds are already allocated. The funds are not tied to the projects list,” Burtron said. “We found ourselves with a contractor who did not live up to their level of performance. Administration doesn’t like it anymore than you do. We are taking legal action to recover these dollars. What else are we to do? It wasn’t over cost.”

Burtron

Burtron

Burtron said the options to pay the outstanding bills would be for the city to borrow from itself and repay the infrastructure improvement fund or take out a bond and pay fees and interest.

“This is the reasonable way to deal with it. These monies will come back to us,” councilor Chuck Lehman said. “It’s a situation we did not plan to be in. It’s the most effective way, the cheapest way to meet these obligations.”

“This has no immediate impact on our infrastructure projects,” councilor Steve Hoover said.

Several councilors pointed out that the $6 million of Grand Park’s $45 million price tag is a small amount.

“Utilities are an asset. Grand Park is an asset. It’s an asset, a physical asset. The park when it becomes more operational, more complete, you know the dollars are going to come from sponsorship and its operating value will increase,” said Jim Ake, council president.

The appropriation was approved 5-1 with Spoljaric casting the dissenting vote and Stokes abstaining.