OCEAN CITY – The Town of Ocean City is at its wits end with the delay of the Caroline Street Comfort Station completion as the contractor is warned its performance bond will be called if the project is not substantially complete by the end of the week.
On Monday evening, City Manager David Recor presented an update of the Town of Ocean City’s Strategic Plan and the progress of the plan’s action items during the past year. One of those action items was the reconstruction and completion of the Caroline Street Comfort Station on the Boardwalk. As of Monday, more than a year after demolition of the former structure and construction was initiated, the project is not finished, despite earlier deadlines of Memorial Day weekend and then subsequent proposed completion dates passing.
“As you are all aware, it is significantly behind schedule due to weather delays and contractor performance,” Recor said. “I have spoken with the city engineer and we are prepared to and will call the bond this Friday.”
On Tuesday, City Engineer Terry McGean confirmed he has advised the contractor, Black Diamond Builders, if the Caroline Street Comfort Station is not substantially complete by Friday he will formally request the contractor’s bond company take over and complete the project.
“They seem to have gotten the message,” McGean said. “A lot of things that have been dragging on are now getting done, so we will make the final determination of whether we bring in the bonding company or not.”
McGean explained when the town bids and contracts a project over $100,000 the contractor is required to supply a performance bond and payment bond, which both act as a form of insurance. A payment bond guarantees the subcontractors are paid and the performance bond guarantees the project gets built. If a project’s performance bond is called, the contractor is taken off the project, and the bond company brings in its own construction crew to finish the project.
The town is under a $938,000 contract with Black Diamond Builders to construct the Caroline Street Comfort Station. The project is being funded by a bond that was issued at the same time as the bond to reconstruct the Boardwalk, which was completed last spring.
The old underground restrooms at Caroline Street and the Boardwalk were demolished last December and the construction of the new, state-of-the-art facility complete with a performing arts stage began shortly thereafter with a projected finish date in May before the arrival of the summer season. However, a wet spring and some poor decisions slowed the construction process, and it became apparent the new facility would not be completed for the start of the summer season.
When poor weather continued through much of June, further slowing the construction of the new facility, the city contracted with a private waste disposal company to provide temporary restrooms for Boardwalk visitors on a site immediately adjacent to the construction site and just behind the Fireman’s Memorial on North Division Street. At the end of August, the new Caroline Street Comfort Station was given a month to be completed. At that time the contractor had already entered into its penalty phase for missing the deadline.
On Tuesday, McGean reported about 95 percent of the comfort station has been completed but the last 5 percent has been stalled over the past couple of months.
“The two restrooms have basically been usable and pretty much substantially complete since Oct. 18 but … all this work was still left to be done since October and it still wasn’t, so my patience finally reached its end,” McGean said.
McGean gave the contractor a check list of items to be completed by Friday that included foot showers installed, completion of the electrical closet on the stage, dressing room completed, railings installed and signage on the building.
As of Tuesday, the foot showers and electrical closet were completed and the contractor was on site installing the railings and signage, and working on the dressing room.
“I am optimistic by Friday they will have those things completed,” McGean said.
Once the project is substantially completed, all there is left is the “punch list”, such as paint touch ups and other minor adjustments.
“They will have only so many days to complete the punch list while we are still withholding about $100,000 in payment, and then there is the whole liquidated damages issue,” McGean said.
McGean explained if a project is not completed within the timeframe stated in the contract liquidated damages is assessed at $1,000 every day the project is delayed.
“The purpose of that charge is to cover our expenses to the town that have occurred as a result of the delay in the project, such as the port-a-potty rentals, the additional time to pay the architect, potential lost revenue, for example we lost the use of the stage and were not able to put on any acts during the summer,” McGean said. “It is meant to keep the town whole, and they [Black Diamond] are in excess of about $100,000 right now.”
In McGean’s career with the Town of Ocean City, he has never gotten to the point of coming close to pulling a projects performance bond.
“It is a shame it had to get to this point,” McGean said. “Calling in the bond company is a last resort. Usually once that happens it is difficult for a contractor to get bonded again, which makes it difficult for them to work on any sort of large project. Hopefully, they have gotten the message. I am certainly seeing more progress in this past week then I have seen in the last two months.”