HomeMy WebLinkAbout04/04/1990, C-4 - PAYMENT ADJUSTMENT FOR LIQUIDATED DAMAGES IN WATER MAIN RECONSTRUCTION PROJECT - JOHN MADONNA CONST "�'I�IIIIIII�IIII yJ 1 � MING DATE:
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wa COUNCIL AGENDA REPORT ITEM NUMBBi:
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FROM: David Romero, Public Works Director
SUBJECT: Payment Adjustment for Liquidated Damages in Water
Main Reconstruction Project - John Madonna
Construction Company, Contractor
CAO RECOMMENDATION:
By motion, approve payment adjustment on
liquidated damages item
BACKGROUND:
This water main reconstruction project involved construction in
four different areas: Hathway/Montalban, Grand/Wilson,
Warren/Patricia, and Flora/Alrita. Total cost of the project was
$92, 302.91. It was very complicated and required careful
planning and substantial organization in order to be completed
within the specified time frame. The contractor completed the
work long after the specified completion date. Therefore
following provisions of the specifications, the City assessed
liquidated damages in the amount of $9, 000 which were deducted
from the final payment. John Madonna was slow in presenting
information regarding this liquidated damages assessment, and did
not meet with City staff to discuss the matter until after the
final payment for the. contract had been approved. After a
lengthy discussion, staff and John Madonna compromised on an
amount of $2,500 for liquidated damages.
Since final payment has been made on the contract, the $6,500
($9, 000 - $2, 500) of the adjustment must be made outside of the
contract.
DISCUSSION:
Calculations of construction days on a contract is subject to
many variables and much judgement. The City often requests
contractors to delay the start of a job due to conflicts with
other work in an area, holiday traffic, or might delay work on a
job during its progress for these same purposes. Sometimes the
contractor is delayed because the City is unable to provide a
water main turn off, thus delaying the contractor through no
fault of his own. There is also judgement involved at the end of
a job when major items of the work are functioning, but minor
pickup items have not been completed. The City and the
contractor each keep detailed lists of these items during the
progress of the work, and these are usually resolved between the
contractor and the inspector before final payment. In this
particular case this was not done, thus creating the necessity
for separate action. _
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Liquidated Damages
Page Two
STAFF RECOMMENDATION:
Staff feels that the best way to determine liquidated damages is
at a negotiating session between the contractor and the staff,
and that the figure finally arrived at is probably the fairest
means of adjusting this difficult item. Unfortunately on this
particular job, this did not take place in a timely fashion.
However, staff feels it is proper to reimburse Mr. Madonna $6,500
of the $9, 000 imposed for liquidated damages.
APPROVED:
City Adpinistrative Officer
At n
Finance Director_
Public Works Director
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Attachment: Inspector memo
johnm/dfr#20
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City Of SAn luis OBISPO
955 Morro Street • San Luis Obispo, CA 93401
March 14, 1990
MEMORANDUM
TO: Dave Romero, Public Works Director
VIA: Tom Gingg, Engineering Field Supervisor
FROM: Bill Coates, Public Works Inspector
SUBJECT: Liquidated Damages - Water Main Reconstruction Project:
Hathway/Montalban; Grand/Wilson; Warren/Patricia;
Flora/Alrita - City Plan Nos. N-30P, N-23P, N-24P,
N-26P. John Madonna Construction Co. - Contractor
Subsequent to final acceptance of the project, further
negotiations of liquidated damages have resulted in a reduction
from $9,000.00 to $2,500.00, which means that an additional sum
of $6,500.00 is due to the Contractor.
Please authorize the payment of a purchase order in this amount.
bcl/damages
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