A California construction firm sued the Los Angeles Community College District over a project that is four years behind schedule. An independent arbitrator recently sided with Pinner Construction, the general contractor on the project. Even with an award of $3.2M, Pinner Construction is now going after the LACCD Board of Trustees.
The company recently amended its complaint to add all seven members of the LACCD Board of Trustees to the suit. It seeks to hold them individually liable for delay-related cost overruns on the project. If successful, the company could force the LACCD Trustees to cough up millions of their own dollars.
The dispute centers on a performance and media arts complex with five theaters, studios, classrooms, and faculty spaces. The 103,000-sq foot facility is comparable in size to WCC’s TI Building. The programs that the building will house currently serve fewer than 150 students.
LACCD awarded the construction project to Pinner in 2016. According to the complaint filed in US District Court for the Central District of California, LACCD’s project managers deliberately caused delays to ensure that LACCD consultants could bill more hours.
As a result of the delays, Los Angeles County taxpayers paid more than $20M in consultant fees. Pinner Construction alleges that the delays caused it to accrue about $25M in additional, unanticipated project costs. The overruns consisted of irregular and unusual design changes, increased materials costs, rework of previously inspected and approved installations, ongoing staffing costs, and fees for lawyers and consultants. Pinner Construction accuses the LACCD of fraud and racketeering in its complaint.
Board of Trustees could be forced to pay costs out-of-pocket
Pinner Construction bases its complaint on a California law that allows public officials to be held liable for waste, fraud, and abuse. The construction company is seeking to force the individual LACCD Board of Trustees to pay for the district’s construction consultants, the loss of the use of the facility as the result of delays, the damages awarded by the independent arbitrator and Pinner Construction’s legal fees. The company may also ask the Court to force the Board of Trustees to suspend its consultants.
Pinner alleges that the Board of Trustees hired the project consultants and authorized them to make decisions for the district. However the Board of Trustees provided little to no oversight. It also argues that the taxpayers should not have to pay for the results of the Board of Trustees’ gross malfeasance. The theater complex should have opened in 2018, but still has months or potentially years of construction remaining. The lawsuit comes at a bad time for the district, which has a $5B bond issue on the ballot in November.
It would be awesome if Michigan had a law like that. It would put a hard stop to “rich community” projects like the Health and Fitness Center and the WCC Hotel and Convention Center. Also, it would make the Trustees liable for their $26M no-bid contracts, their $2.7M employee buyouts, and the 13 Vice Presidents.
It’s just too darned easy to spend other people’s money, isn’t it?
Photo Credit: Blogtrepreneur , via Flickr
