Prompt Payment
Obama Center Opens The Doors as Subcontractors Say Invoices Remain Unpaid
Several union trade subcontractors weigh legal options
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Work on the Obama Presidential Center in Chicago's Jackson Park last year. Numerous scope changes and change orders were made.
Several trade contractors say they have not been paid for change orders and other work on the $850-million Barack Obama Presidential Center, which opens June 19th in Chicago's Hyde Park neighborhood.
Communication from the Obama Foundation has largely broken down, the subcontractors claim, as they seek payments through the project's prime contractor, Lakeside Alliance, a joint venture that includes Turner Construction Co., Power and Sons Construction, UJAMAA Construction, Brown & Momen, Safeway Constructiion. W.E. O'Neil Construction Co.,. Trice Construction Co. and II in One Concrete are involved in the project as the Concrete Collective joint venture, serving as the concrete contractor. II in One Concrete previously filed a lawsuit against the project's engineer, Thorntom Tomasetti, over concrete and rebar installation.
Most of the subcontractors involved with the project declined to speak on the record but said they were gathering information and weighing whether to file liens or lawsuits.
Omar Shareef, president of the African American Contractors Association, told Crain's Chicago Business that seven separate subcontractors have contacted him in recent months for help pursuing payments.
Adamson Plumbing, a minority-owned business. is owed more than $2 million, says its president, Michael Owen.
"There are a whole slew of change orders that [the JV contractor] asked us to price and proceed on," says Owen, president of the Addison, Ill.-based union employer. "A lot of subs on the project had already received that guidance and proceeded. We probably have close to $450,000 in price and proceed and a couple of them we are now at a complete loss for."
In a statement, Lakeside Alliance said such problems are common on large projects and it remains committed to making trade contractors whole.
"The Obama Presidential Center involved multiple structures, thousands of design documents, and hundreds of trade partners and community businesses. As with many major construction projects, contractual closeout—including the review and resolution of outstanding invoices, change orders, and other project matters—continues long after the doors open," the statement reads.
It also said Lakeside Alliance continues to work to support the businesses that helped deliver the project.
"These companies have broadened their skills, expanded their relationships, and enhanced their ability to compete for future work on major projects across the country. We remain committed to working through outstanding matters to successfully close out the project," the statement read.
Small Discrepancies
Adamson'a Owen said many of the issues on the project stemmed from very small discrepancies that were simply lost in the transition from design to construction.
Early in construction, for example, the tile walls in bathrooms with flushometers installed had incorrect dimensions. Owen says he called the supplier and quickly priced replacements and got the okay to price the new supplies and fix the problem, a roughly $20,000 change order.
When it came time to get paid for the change orders that were documented in the project construction management system, several subcontractors say they were denied payment by the owner despite being given the okay to price and proceed by Lakeside Alliance. As issues continued to arise during construction and the Obama Foundation added scope, the initial total cost of the project ballooned from $300 million to $650 million, then to $850 million. Rework and added scope required tapping the project's contingency fund.
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