City council not ready to finalize street payment

City council not ready to finalize street payment
After months of work by Sioux City Engineering, the main contractor for the Dakota Street reconstruction project in Vermillion, the major traffic route that runs on the west side of The University of South Dakota campus is open to traffic once again.

Members of the Vermillion City Council, however, aren't ready to close the financial books on this project yet.

Sioux City Engineering agreed to have the project completed by Nov. 1 when it was awarded the bid for the street work. This fall, when it became apparent it would miss that deadline, it asked for, and was granted two extensions by the city – on Nov. 3 and Nov. 12 – to complete the project.

It missed both of those deadlines.

It's not unusual for construction companies to fall behind on some endeavors. As a normal procedure, part of the city's contract with Sioux City Engineering calls for the firm to pay $750 for each day the work extended beyond the deadline.

Dakota Street didn't open until Dec. 1.

It turns out, however, that even though glancing at a calendar indicates the work went two weeks beyond schedule, calculating the actual liquidated damages, in other words, the financial penalties that the contractor owes the city, isn't that simple.

The Nov. 12 completion date, printed on a document being studied by aldermen Monday night, is based on the assumption that a change order including that date would be accepted by the city.

"It based on the assumption that the city council would approve the change order and move the completion date from Nov. 3 to Nov. 12," City Manager John Prescott said.

The document, he said, isn't meant to state that the street work was actually done on that date. Rather, it's purpose is to state that Nov. 12 is the date to use when determining liquidated damages.

City council members, particularly Alderman Jere Chapman, indicated they didn't feel the contractor would pay enough in liquidated damages with the completion date set at Nov. 12. Chapman, noting there were days this summer when no workers were present on the street, indicated the city should set the completion date earlier in November so the contractor would have to pay more damages to the city.

Aldermen or city staff may meet with contractor representatives to settle this issue, Prescott said.

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